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robertm

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Posts posted by robertm

  1. Posted

    I don't see many asian traders are suffering

     

    It's a brilliant place to live/trade from time zone wise, and one of my favorite markets, but if you were to rely on ONLY the Asian session to trade you are cutting out all the best moves on the FX markets, the US Options market, and if you can't get a CFD account you aren't able to reap the same rewards as being based outside North America.

     

    Any high frequency system is best coupled with a steady longer term system anyway, market conditions permitting :)

  2. Posted

    Why is that a problem for trading?

     

    Because if you want high frequency intraday trading the futures contracts will make their move in the Asian overnight session as it reacts to the US futures contracts. So you may as well be trading the leading instrument in that case at the same point in time.

     

    It's no to say there aren't opportunities available if you are patient, you just can't force a system onto a market that it's not suited to just to fit your trading hours.

  3. Posted

    Oops, I didn't notice that. Then you might want to take a look at some Asian indices, such as Nikkei, HSI, or KOSPI. Also European contracts such as FESX or FDAX. The Asian ones will be closer to the time you specified. I've recently become interested in HSI (Hang Seng), and the futures contract starts at 18:45 PST, though the cash market opens at 19:00, 15 minutes later. There are several good threads here on pretty much every market I listed above where you can get more info.

     

    The problem with a lot of Asian indices is they simply follow the US and don't show much independent thought at that time of the day. FX market is also dead as the Asian session is pretty quite, you could use an indicator setup & limit order system similar to what Raghee Horner advocates perhaps to catch moves as the European FX session starts just towards the end of your trading bracket, but it's longer time frames so not very frequent (which isn't to say it isn't profitable still).

     

    You could catch the end of day ASX equities/sectors markets which are good to trade, but without access to CFD's you can't really take advantage of those instruments. You'd have perfect timing for trading ASX intraday but it's not as lively as the US intraday markets (many moves are made at the open reacting to the overnight US action). Likewise ASX options market is pretty lame as it's all about CFD trading now. On the bright side AUD is going up which would boost your returns.

     

    I find that the period you are looking to trade is my dead zone, I sleep during those exact hours & start trading just as you would be finishing :-/, one of the reasons I've never traded from the West coast.

  5. Posted

    Hello,

     

    I am in the market for a decent broker to trade FX. Right now I am switching back and fourth between the MB demo and the FX Solutions Demo.

     

    A reputable source also recommended I look into FXCM Micro.

     

    Since I've started the demo, MB has given me several problems. Once due to some bad info on their side, and another just would not let me modify an order, and would have wound up costing me money. These could be isolated events, or a precursor as to what's in store?

     

    FXSolution seems to display wider spreads.

     

    Eventually the plan is to switch soley to Currency futures, but for now the FX is the mode of choice.

     

    And why can't an FX broker create a DOM like structure? Nobody cares abotu the market depth, but just being able to have price in the center, and you bracket orders around that? Maybe some day?

     

    Any opinions?

     

    The platform can be a bit temperamental if you open too many charts but I still think GFT's Dealbook360 is a good option, I've used it for years now. Spreads are fine unless you are trying for very low pip trades.

     

    I haven't had time to check it myself but a friend is using IB with a Ninja Trader DOM.

     

    GFT allow you to use Strategy Runner with their product according to one of their BDM's I spoke to, but I haven't tried it myself.

     

    Also check out eSignal for FX charts as they provide many of the broker feeds but give a more stable and flexible platform (ie, you can get the GFT FX data feed and chart eSignal but execute on the GFT platform). It's no tcheap, but if you rely on charts for signals you want to do it right rather than what the broker jams down your throat, brokers are more about execution. The "default" FX data on eSignal is very whippy with long tails as it's looking at many data sources and takes in outliers so many people write it off without understanding you can get the broker feeds.

     

    Most brokers will burn you in the end if you get too good it seems, so ensure you system is portable, and always have more than one account ready to go :-)

  6. Posted

    I don't break down risk by individual trade. I place stops where I think they are needed for a successful outcome on the trade. The more confidence you have the tighter the stops get. This works in a liquid market like ES, but won't work for YM. Liquid markets allow you to use tighter stops illiquid markets you must use wider stops.

     

    Jean

     

    Where our stop is has nothing to do with how much we risk on the trade. The difference between entry and our stop is what our % risk calculation is based upon to ensure our risk is constant across each trade. How this is determined - technical, % daily range, ATR multiple etc is a factor of what gives us the best results for our system.

     

    If our risk at x% = $1000 per trade, and we risk $300 on each contract (to use contracts as an example), then we can trade 3 contracts on that trade.

     

    If your system states you can run a tighter stop (which should be based on sound testing and evidence rather than confidence), then you are risking less per trade, and can trade more contracts while still only exposing $1000 per trade as your maximum loss.

     

    Your performance is then a measure of your risk multiple, 1:1, 1:2, whatever the maximum is you can get from your system. If you use technical targets, then maybe you opt out of trades where your technical stop & profit result in a risk:reward that brings the probability of system success too low (ie, lower than 1:1).

     

    Liquidity has nothing to do with placing our stops unless you are a massive fund manager or trading something so illiquid you probably shouldn't be doing it in the first place, liquidity is more to do with whether our system is tradable on that particular market, instrument or individual equity.

  7. Posted

    Money management teaches us how to avoid the costly mistakes done by various new traders. Often they lose the entire amount of investment on the first hand of trade. Psychology is the most important factor to money management in forex no emotional attachment with the money how so ever. This is not very easy but it works successfully. Don’t allow yourself to get emotional on trade which can be an obstacle to trade properly.

     

    Ok I agree most of the talk surrounding trading Psychology is dealing with money management related themes - letting winners run, cutting losses, riding out equity swings without messing with your system, picking the right markets and risk tolerance etc - but it's not the most important factor. Having the correct risk strategy will in itself manage many of those psychological issues, as you have defined your risk:reward expectations in advance.

     

    A hybrid (at stop) equity model can give us an accurate forecast of where our account stands at all time across longer and mid term systems, although some instruments are more hit and miss than others (CFD's we can be dead on thanks to GSLO's, Options are a little harder to pin down). With this factor known we are aware of what our drawdowns will be should some tool suddenly suggest interest rates need to go up in the US, or that a major banks share price is not worth the paper its written on.

     

    Managing losing streaks on a shorter term (intraday) system is a more complex argument, but using appropriate % risk models until the system has proven it's profitability over a variety of market conditions tends to the job better than belting away at 5% risk and being told to "stick at it as it's a long term game" as many of the so called experts running trading rooms tout these days, or my favorite recently - we can have you up and running writing options on a live account within a week.

     

    It could be argued that having declared yourself a trading god during a bull market and loading up your risk only to run in to a congestion phase as we did on the FX markets recently is simply a show of inexperience as a trader, the psychology only comes into it when they have to pick themselves up off the floor, work out what went wrong, learn from those lessons, and get back in the fight. Hopefully a structured risk plan has left enough of their account intact to do this.

  8. Posted

     

    It should be pointed out that CFD's are not allowed to be traded by US residents (& citizens?), which is kind of odd given they rule trading in many other markets in the world now and replaced much of the need to trade options for leverage, so in part it's to protect the options market revenues in the US I guess, and protect them from those "evil derivatives that will be the end of the world", CDO's are much safer :rofl: . Given the current overreaction on regulations on trading in the US it's not expected CFD's will get the green light anytime soon as the leverage gives the potential to stuff up in spectacular fashion if you get it wrong, as in futures.

     

    As a trader CFD's (not to be confused with spread betting which didn't take off outside the UK) are a revolutionary product that allow risk management strategies unavailable with any other trading instrument, although each broker varies in this regard so you need to use the appropriate broker for the type of strategy you are looking to achieve.

     

    Many CFD brokers are promoting themselves to be FX brokers these days, which they have always offered but there is no real edge in using them verses a normal FX broker who specializes in that field, the real advantages are in what you can do with equities trades, and the ability to trade multiple global markets from a single broker account.

     

    Due to the carry costs on the long side which are calculated on the entire position as it rises and falls in value, not just the loaned portion as with a margin loan, a different strategy needs to be employed from other equities trading instruments to offset this cost or there is no benefit, and probably a cost, in trading CFD's (although using the leverage to free up capital for other trading instruments has some benefit, but marginal in this case as there are other ways to do this).

     

    It is a BRILLIANT instrument if you can get your hands on it as a professional trader, but you have to trade it aggressively and employ all the risk management tools it affords you.

     

    As many of the brokers are just market makers they can adjust the tick value on instruments such as S&P, Dow, Oil & Copper to make it more tradable for small accounts as well instead of trading the full futures contracts or mini's. The downside to market makers is they can be a %%$##^&&^$## pain to deal with sometimes, and the data on their own charts is not to be trusted in many cases (I use eSignal, Amibroker and other data sources and just execute on their platforms, and dispute any "odd" prices).

     

    But if you can swing a way to trade them, do so! You won't find many trading educators that understand them though or how to really get the big gains out of them, it's still a niche very much at this point in time, and your results are only limited by your creativity with your money management strategies.

     

    Options still have their place as they have unique strategies like straddles & spreads, but the expiry sucks from a straight direction trade point of view, especially if you stuff up the volatility component.

     

    I <3 CFD's, I simply couldn't imagine how my trading plan could exist without them!

     

    :hijacked: :rofl:

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