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Steve,
Enjoyed your post (I love from the heart stuff - it elevates us above
the humdrum).
Yes, there isn't much value in back & forths unless we are clarifying
a technical/educative point.
I quite liked Teresa writing style (I can relate to the fun and games
of the domestics encroaching on the trading office etc) but that is
where it ended - once she got into explaining the 'system' I couldn't
keep reading - judging it on its merits I don't rate what is there
(nothing to do with discussion on things like 'people who can, do and
people who can't, teach).
I wasn't going to say anything but since you 'came out' I will second
your motion:
> 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
In my experience so far I agree this is the 'benchmark' - 50/50 W/L
and a PayoffRatio of 1.5/1 are the norm and do provide the edge if
managed correctly. For high frequency trading this equates to > 30%
PA returns, which is the benchmark that others say they use.
(I have lightly discussed the reasons why (nominlly) PF == 1 * 1.5 is
achievable and why it is the 'target'.
In my hearts of hearts I always want to go 70-80% at 1.5, or better
but that is a private thing, but I will settle for PF 1.5 - that is
still good trading under the right circumstances (of course > 1.5
leads towards four figures PA which, theoretically, I believe is
possible and my expectation of myself is to do that).
> believing in themselves and learning to trust their own experiences
> over what anyone else had to say.
Yes, that is what works for me.
"Everything starts from personal belief and it is non-negotiable".
brian_z
--- In amibroker@xxxxxxxxxxxxxxx, "scourt2000" <stevehite@xxx> wrote:
>
>
> 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@> wrote:
> >
> >
>
http://www.tradingmarkets.com/.site/eminis/commentary/favorite_strateg
y/
> 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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