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If you follow the link to its conclusion and find the original author's
website, take a look at her trading stats this week on the ES. She's
got 7 years futures trading experience and she's taking 2 pt stop
losses and half-offs at 1 pt? That's not good.
With a good edge, you can expect to daytrade the ES with no more than a
1.50 pt stop loss, a 1.5 to 2.0 payoff ratio and a long-term winning
pct. average of 60%.
Please, don't ever try and trade the ES with a payoff ratio of 0.50
unless you can sustain a 70% to 80% long-term winning pct because a
more reasonable 60% winning pct with a 1.5 payoff ratio will make more
gains than a 70%-er with a 0.50 payoff ratio with far less stress
involved.
Try all the backtesting on ideas you like and you'll see a general
trend in the good edges:
1. High winning pcts. come with < 1.0 payoff ratios.
2. High payoff ratios come with low winning pcts.
3. Systems in the 50-65% winning pct. window come with 1.5 to 2.0
payoff ratios.
And, by the way, I'm speaking to the 2-3 ES contract and 1-2 ER2
contract traders out there trying to make a living at this, not any of
you who consider yourself big fishes where you play games with
unreasonable stop losses and averaging down in your positions.
Just be careful of people freely giving you an edge and then turns
around and has a website-for-profit to "teach" you how to be a "market
winner". Because I take one look at her money management, knowing
full well what's doable on daytrading the ES/ER2 for 5 years, and it
becomes obvious why she's got a secondary service to teach.
Realistically, it takes anywhere from 2 to 4 years to get good
(definition: you make a living just with your trading) at futures
trading, depending upon how messed up your emotional insides were when
you started. Most drop out within 2 years due to bad money management
and continually trading with bad edges because they believed too much
in some other person trying to sell them on their methods instead of
believing in themselves and learning to trust their own experiences
over what anyone else had to say.
[I'm not into back-and-forths when I speak from the heart like this. I
could be wrong, but after 5 years of facing the ES and ER2 in real-
time, discretionary daytrading, I highly doubt it.]
--- In amibroker@xxxxxxxxxxxxxxx, "bilbo0211" <wjdandreta@xxx> wrote:
>
>
http://www.tradingmarkets.com/.site/eminis/commentary/favorite_strategy/
Eminis-Teresa-Appleton.cfm
>
> I have not back tested it but checked it on a variety of charts and it
> seems to work quite well to get at least a scalp. In a strong trend it
> generates very few signals but intraday strong trends that last all
> day are rare.
>
> If I get time, I will back test it and post the results.
>
> Bill
>
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