Weekly income from trading - is it possible?

[metric]

You need to first find out where your niche is.

is this the best bit of advice posted so far?

 

[Trembling Hand]

Wayne / TH: have either of you ever scalped any of the large volume stocks on the ASX - be it buying/selling the underlying equity or through CFDs?

Have tried. I have a go with BHP when I have some firm ideas but its not really scalping more intraday swing. The problem with doing it with stocks is the larger move you need to cover your brokerage. With Futures you need less than 1 tick to cover your cost(spread aside) and same with Forex. With BHP for example you need a 6 cent or so just to cover brokerage(depends on your size and broker)

 

[Timmy]

TH, I left my last post with the question "Can I do it?"

The next logical question is "How can I do it?" and your comments here are of direct relevance to that:

Have tried. I have a go with BHP when I have some firm ideas but its not really scalping more intraday swing. The problem with doing it with stocks is the larger move you need to cover your brokerage. With Futures you need less than 1 tick to cover your cost(spread aside) and same with Forex. With BHP for example you need a 6 cent or so just to cover brokerage(depends on your size and broker)

Keep this stuff coming, what a great thread.

 

[wayneL]

Wayne / TH: have either of you ever scalped any of the large volume stocks on the ASX - be it buying/selling the underlying equity or through CFDs?

I'll echo TH's comments, but add that it is much more feasible on Nasdaq stocks. The brokerage is way cheap, Margin is 25%, you can easily short and liquidity is enormous.

There are masses of day traders who never venture outside of the Nasdaq who do just great.

 

[tayser]

Nasdaq times are bollocks if you live in AUS though

 

[IFocus]

Nasdaq times are bollocks if you live in AUS though

I remember saying that to a trader here in the West that traded the US S&P and got told to get over it........LOL

 

[tayser]

It's better for you over there but yeah, if I didn't have a FT job Id suck it up and do the opens no worries.

 

[Trembling Hand]

About night trading would you want a brain surgeon come to you and say you can have the day shift do your brain operation or you can have the night shift do it at 3 am in the morning.

What would you pick in relation to decision making and skill performance of people working through the night.

All things being equal you would choose day shift every time.

I know I use to own bakeries. People make silly mistakes when they work night hours but live in a world that runs during day hours.

 

[Markcoinoz]

Have tried. I have a go with BHP when I have some firm ideas but its not really scalping more intraday swing. The problem with doing it with stocks is the larger move you need to cover your brokerage. With Futures you need less than 1 tick to cover your cost(spread aside) and same with Forex. With BHP for example you need a 6 cent or so just to cover brokerage(depends on your size and broker)

Hi TH,

I take my hat of to you.

That was a classic showing that it is possible.

Well done.

Again, I would say it is highly improbable.
Not everyone can cut it even though you have shown that you can do it.

Put me in trading Indices or FX I will guarantee you I will lose the lot for you in 7 days. Lol!!

However, if it were playing share Warrants like BHP, I would probably do fairly well over a period of time.

In the early 90's i played the roulette tables around Australia for a year with only $10k in my pocket. I had a ball during that time. Everything was payed for by the Casinos including hotels and airfares. After a year I got bored and got sick of going to the same venues over and over again. Also a bit of a lonely life. Could everyone do that?

I would suggest no.

Again, it really comes down to the niche area of the market that suits your risk or comfort zone.

Hope you continue to scalp the markets well.

Cheers markcoinoz

 

[korrupt_1]

I will do it with a $1000 dollar account.

not bad TH... i honestly think you are a grumpy, arrogrant, rude bastard... but will results like, who cares what other ppl think? you have the results is all that matters.

well done.

out of curiosity, from $1k to $50k... do you continually re-invest the winnings or do you set a maximum 'bet' and try to win as many scalps as possible?

have you ever though about writing a "scalping-for-dummies"??? you could do well

 

[Trembling Hand]

out of curiosity, from $1k to $50k... do you continually re-invest the winnings or do you set a maximum 'bet' and try to win as many scalps as possible?

That's is the WHOLE argument. Trades don't continuously compound their returns.

Trader continually TAKE money from the market. I am pretty sure on the SPI I am close to the limit of volume I can do with this system. Maybe I could double it with some changes but thats probably it.

The first hour of trade on the SPI I can do 50 or more trades of 2 to 5 SPI contracts that, up to that point is about 2% to 3% of the market. How much more volume could I do?

On the HSI I am only trading 1 contract about to go to 2 but anything over 5 and it would be very hard to scalp.

 

[tayser]

But aren't there two different phases we're talking about here? Compounding would only occur during phase 1 - using korrupt's $1k to $50k & FX as an example:

Phase 1: Start up through to optimum account balance for income generation.

Start with $1000 and build your way up to $50,000. Start with lot sizes around 20,000-30,000 (25% account balance) and compound with each win until the account balance is roughly $50k - however long it takes (weeks, months, years!)

Phase 2: income generation.

At the start of each week you have $50,000 and at the end of the week you withdraw the difference between what you have and $50,000 (that is of course if you're positive for the week!).

As an example, $50,000(AUD) buys 50,000,000 AUD/JPY @ 1:100 - there's no way in hell you could trade that amount on a retail ECN, 10,000,000 is far more plausible (my estimates on EFX are that 20,000,000 would be the ceiling for that pair based on what you see in the market depth). 10,000,000 = pip value of roughly $1,000 AUD (~90,000 yen), 50 pips (net of commission) for the week = $50k that you end up withdrawing on the Friday.

 

[Trembling Hand]

Yeah for sure.

I got to say(in spite of my challenge to ROE) there is no way that you should trade with $1000 thinking its going to go anywhere but down.

When I have done it its because I had a lot more $$ to burn just not in that account. And I know I can do it now because I know my system. That's a long way away from hoping you can turn $1000 into $50,000 while still learning. I hope I haven't misled anyone on that just using max drawdown and 1% max stop you realise its not going to happen. You really need to start with $50,000 min.

 

[prawn_86]

I got to say(in spite of my challenge to ROE) there is no way that you should trade with $1000 thinking its going to go anywhere but down.

What if you were just working on slowly compounding the account?

Such as myself and Tayser have been paper trading in the Cyrox forex thread.

If you can consistently make your pip target after X months of paper trading, and then meet the targets when you go live, I can see why you cannot start with 1k. Just dont expect fast/quick returns thats all.

 

[Trembling Hand]

As an example, $50,000(AUD) buys 50,000,000 AUD/JPY @ 1:100 - there's no way in hell you could trade that amount on a retail ECN, 10,000,000 is far more plausible (my estimates on EFX are that 20,000,000 would be the ceiling for that pair based on what you see in the market depth). 10,000,000 = pip value of roughly $1,000 AUD (~90,000 yen), 50 pips (net of commission) for the week = $50k that you end up withdrawing on the Friday.

Just a note this example blows the most important trading rule. The 1% max account per stop loss.

I would think thats not the best position sizing. Margin should be ignored in position sizing calculations. Its the 1% rule that counts.

 

[Trembling Hand]

What if you were just working on slowly compounding the account?

Such as myself and Tayser have been paper trading in the Cyrox forex thread.

If you can consistently make your pip target after X months of paper trading, and then meet the targets when you go live, I can see why you cannot start with 1k. Just dont expect fast/quick returns thats all.

The FIRST and most important rule is that 1% rule. If you can stick to that then I guess thats OK. BUT you are really going to be up against it. Just too hard to take any draw down, every bad day is going to be a step closer to blow out and there is going to be to much pressure to leverage up every little gain you get. Which will probably result in giving that back quick smart.

With small accounts the focus goes from process to $ results and thats the worst thing to do when you are trying to actually make $.

 

[prawn_86]

Thanks TH, appreciate the feedback

When I can consistently hit my target paper trading then I will re-evaluate as to how much capital I need when I go live.

 

[julius]

scalping FX like you guys do is different because you've got more flexibility with position sizing

you lose that when trading futures

 

[el caballo]

Classic thread - first time I have read through it. Does this forum have a special section where "classic threads" or posts be stored for posterity? It would be a shame for future uninitiated users to miss it.

 

[theasxgorilla]

On the HSI I am only trading 1 contract about to go to 2 but anything over 5 and it would be very hard to scalp.

Give a yell when you reach capacity and I can set up a trading room for you on this side of the world and you can trade the US during normal hours