Futures blog, GB

[precitra]

buy back ngk8 at 2.747

 

[precitra]

short gcm8 at 1351.1 short 6am8 at 0.777

 

[CanOz]

Woke up to a Tidy little profit on that GC trade....did you trade it GB?

 

[Gringotts Bank]

Woke up to a Tidy little profit on that GC trade....did you trade it GB?

No I don't take every single trade that I mention here, and conversely, I take trades that I don't mention here. A trading journal with a difference.

Gold's spread is way too high as a CFD. Still trialling new platforms for futs.

 

[Gringotts Bank]

The inability to position size with a small futures account is posing a problem. You either start with a huge account and size properly, or you have to take 1-2 contracts and maintain a high win rate. CFDs allow you to get around this with $1 contracts, but with futures I'll need to avoid set ups with big targets.

 

[precitra]

high win rate is the key. trade just like drive the car. system is gps.

 

[Gringotts Bank]

How does liability work when you open an account with a futures broker? I'm getting the impression that if the market tanks big time you can find your stops didn't trigger and be held liable for huge losses. Is this correct?

AMP says they will attempt to close all open positions in the case of daily loss limits, but nothing is guaranteed. Yikes.

Maybe I should look into playing with OPM.

 

[CanOz]

This went well....got stopped out of gold long, a dax long, and a bund long...

All but GC were above break even...

Modest would be proud, i was short going into the inflation announcement ....

 

[CanOz]

How does liability work when you open an account with a futures broker? I'm getting the impression that if the market tanks big time you can find your stops didn't trigger and be held liable for huge losses. Is this correct?

AMP says they will attempt to close all open positions in the case of daily loss limits, but nothing is guaranteed. Yikes.

Maybe I should look into playing with OPM.

Liquid markets are fine, but there are times when the unthinkable will arrive. I have not had a bad stop fill in nearly 7 years of trading futures...But i'm not sized for destruction either. I have the account size to weather a black swan or two.

 

[Gringotts Bank]

Liquid markets are fine, but there are times when the unthinkable will arrive. I have not had a bad stop fill in nearly 7 years of trading futures...But i'm not sized for destruction either. I have the account size to weather a black swan or two.

Thanks. I wouldn't want to find the US market down 15% one day and AMP telling me I owe them money, and sorry but your stops couldn't activated. I couldn't handle that.

 

[CanOz]

Not sure I understand your predicament.....you're all for cfds but not for futures? Perhaps it's the account size that's holding you back.

This game is 90% risk management, but it's just math. What is your risk of ruin? How much can you afford to lose?

 

[Gringotts Bank]

Not sure I understand your predicament.....you're all for cfds but not for futures? Perhaps it's the account size that's holding you back.

This game is 90% risk management, but it's just math. What is your risk of ruin? How much can you afford to lose?

CFDs were good in some ways because they offer guaranteed stops for a small fee, and they allowed me to positon size. Problem is the pricing of CFDs is highly questionable, sometimes 100's of points away from the actual futures contract. Their reason is always that this differential can happen when markets are volatile, which is unacceptable to me.

Risk management - yes. I want to be able to have a definite stop, ie. one which will be guaranteed to trigger if the market tanks hard.

 

[CanOz]

Then pick your instruments carefully. The 6B, GC, even CL have suffered fairly frequent flash crashes. You can't just walk away and leave a large position on. Equity indices on the other hand have rarer occurrences of liquidity evaporations....at the end of the day you need to be prepared for all circumstances and that includes the black swans.

 

[Gringotts Bank]

Then pick your instruments carefully. The 6B, GC, even CL have suffered fairly frequent flash crashes. You can't just walk away and leave a large position on. Equity indices on the other hand have rarer occurrences of liquidity evaporations....at the end of the day you need to be prepared for all circumstances and that includes the black swans.

The black swan is no problem at all, so long as stops can be activated. But you're saying they can't always, even in the most liquid instruments. How do you prepare for a solar storm hitting the US when all communications are out?

 

[CanOz]

You prepare by not holding all of your eggs in one basket. You prepare by having a risk plan. GB there are no guarantees in life and these markets are the real thing. You must have another person on the end of your trade for your stop to get filled....that's the reality. Now how do you plan to deal with it?

 

[Gringotts Bank]

You prepare by not holding all of your eggs in one basket. You prepare by having a risk plan. GB there are no guarantees in life and these markets are the real thing. You must have another person on the end of your trade for your stop to get filled....that's the reality. Now how do you plan to deal with it?

I probably need a bigger account. ES is $16AU per tick, yes? So a run of 15 losing trades with a 100 point target (RR=1) means I'd need an account of 24k. No problem there. The problem is when I find the stops didn't activate, the market falls through the floor and the broker wants 500k.

 

[CanOz]

Look at the daily ranges and work that out, unlikely.

 

[Wysiwyg]

Don't trade mate. You won't make it.

 

[Gringotts Bank]

I don't want to put up a big sum of money with AMP if there's a risk they might do a MFGlobal. And leveraging my own money tothat degree feels too risky if stops can't be guaranteed.

Up for hire.

 

[CanOz]

You could pretty much trade whatever you want with a 10k account with AMP, lowest margins around. That's the beauty of them, keep your money in the bank. Use only what you need for margin.