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I guarantee you you're either taking larger risks than you would with a real portfolio or getting lucky.
And how many days have you done this? What is your strategy?
I've been doing it daily for almost 6 months now. I use a lot of technical indicators that's about it.
It is vastly easier to trade with paper trading because it doesn't matter. You can take massive risks, or not panic when a position starts to go against you before running up huge. I mean I had silly paper returns by hitting home runs with OTM options, positions I would not have taken in my own personal portfolio (or at the very least, not held and watched continuously with stops). In other words, ditto what was said above.
Sounds like you've got this trading thing wired. Here's what you do next:
Good Luck and Good Trading!
I have nothing to add here. Please keep us informed!
This must be how the studen loan thread started! //www.wallstreetoasis.com/forums/studen-loan-horror-stories-what-do-you-t…
Do exactly this.
I can't believe you actually took the time out of your day to write this shit... and in MY thread! Thank you very much good sir. But above all I love how you brought up such rational points and didn't use ANY sarcasm.
I had a friend back in college who literally did this. Except in his case, he used a margin account (more leverage) and traded 3X levered funds that tracked short term VIX futures. Initially, he was very successful and made it very well known that he was. Fast forward a bit, let's just say he got margin-called, obviously had no extra equity to put in, was forced to sell everything, and has yet to pay it all back.
its a serious as you make it.
if you're really doing 1800/day why not take 3500 of your own money, do the same thing and find out. its not a lot of money to risk considering your projected returns that you're stating.
A nice little anecdote of mine, a friend of a friend put $1000 down on an options account. Within 2 weeks he had $100,000. He quit his job, moved to a downtown loft and thought he was God's gift to the markets. He was broke within 4 months and it took him 6 months to find another job.
$1000 to $100,000 in two weeks lol... even by trading the most out of the money options I don't know how that math works.
VIX options during the shitshow probably.
This. Your strategy likely has too much drawdown. But who knows, I say keep at it
It does since i am leveraged to the max, but on my paper trading account i've only had two or three losing days in the entire time i've been doing it. I'm not trying to sound cocky or act like i'm all that i'm just telling it how it is.
My only hope is that Futures can't detect sarcasm and he takes your advice to heart and then proceeds to become the next John Arnold. Then he comes to one of the WSO happy hours in his ferrari and throws actual monkey shit on everybody.
Haha, well you've just ruined any chance of that happening.
Can any one who has experience working on trading desk answer this question what is the real role of the commodity exchange?
I am confused here why would any commodity producer (oil, gas, sugar) would sell his product in the exchange (ICE, Chicago mercantile exchange, new York mercantile exchange) specially that the spot market is way high that the paper market (sugar for example)
Those big commodity trading houses (Cargill, Louis dreyfus, glencore) I thought they are just doing PAPER trading but NO they are doing physical as well. But what is the role of the exchange? For example I called a sugar company asking for 10 metric tons and they quoted the price at 820 while in London it is traded at 570. if that’s the case who is the company that is going to sell a contract of sugar in the market if it is in the Canadian market at 1200 spot and in the American market at 1280. Can not they just sell that directly in the market? In other words, coming the delivery month, there is going to be about 12000 mt standing for delivery. Who is the stupid who sold that in the exchange for 570 while he can sell them in the physical spot market for double the price? The same thing for oil, cotton , cocoa and so on
Assuming this is a serious question, the answer is two-fold:
First, the exchange guarantees payment. In other words, a producer could enter into a contract with a user on his own and have no recourse against the user (aside from a lengthy legal battle) if the user renegs on the contract. The exchanges eliminate that possibility by guaranteeing payment to the producers (ultimately through the FCM's but that a whole other topic). Short answer: exchanges offer set quality and contract sizes and they guarantee payment to both parties.
Second, sugar is a bad example and it's probably just dumb luck that you chose sugar and didn't know about this. There are actually two kinds of sugar traded. US sugar and World sugar. The US sugar lobby was and is extremely powerful and a long time ago lobbied the government to permanently inflate the price of US sugar so US sugar producers wouldn't go out of business or have to compete with 3rd world sugar producers on price. It's basically bullshit but it is what it is. So getting a quote on US sugar is going to be quite a bit higher than a quote on sugar in London or anywhere else in the world. I'm assuming you cited sugar out of pure coincidence, so now you know. But the rest of the exchange-traded commodities markets are really pretty efficient.
The element of psychology is completely removed in paper trading.
Always be short gamma, 6-sigma events never ever happen.
No they actually are supposed to happen every several thousand years... for some reason they happen every decade. Must just be bad luck.
Agreed, must be bad luck, the quants can't be wrong.
so the only difference is the psychology?
Only? You make it seem like the psychology is a minute point.
calm down
Psychology in trading is everything (well most everything). I don't care how much of a genius you are if you don't have the temperament you will not succeed. The whole reason I suggest that people start trading even with small, I'm talking like $500 dollars here, increments to start is that you react much differently when it is your own money on the line. You need to feel your losses and temper your emotions when winning to understand how to actually trade. Paper trading is like playing FIFA all day every day, scoring a million goals, and then going out on a real field and trying to score like Messi. Good luck with that. Also, if your paper trading futures (shot in the dark judging by your name) you have no conception of how bad things could get if your leveraged and a position moves against you quickly. Its easy to say you've got it figured out until that initial margin deposit is wiped out your first day of trading.
The main issue with paper trading is that this guy may really get the necessary confidence to trade aggressively by the success of the demo.
No one in the beginning realizes just how dynamic markets are and that same strategy that's making you 1800 per week will blow you up in one hour if the appropriate situation arises.
I've been using it for a long time now, so i am really confident with it... but i agree with the point you bring up
There are a lot of ass holes on this site, but thank you to those who gave me a response not laced with sarcasm. It was a simple question if you don't want to answer it get out of my thread...
Dude you're all about things that aren't yours. This is YOUR thread even though you have no material claim to it. You have YOUR profits except they're pretend and you're probably accidentally doubling your capital ability with 100% margin (most simulators allow you to double down with margin).
If you want some respect, open an account and put your money where your mouth is. It also wouldn't hurt to stop being a little high school bitch in the comments.
It's my thread because i started it. I am not doubling my margin i took all of that into account when i was checking how many contracts i would be able to trade in real life.
I don't want respect... i don't give a damn about respect on a website all i want is an answer to my question. Is paper trading realistic YES or NO? And if not then why? And i now have my answer, so shut up and i don't see any grounds on which you should judge me as a "high school bitch"
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Fuck you, fuck you, you're cool, and fuck you. It was all good until you revealed your method... Technical indicators? Like the shoulders of the mountain in japan under the arm pit hair of Jesus type technical indicators? Put the chart book down.
I am new to this and they have been working. calm down.
Please demonstrate how. Tell me a stock that you've succeeded with and walk me through your selection process.
It's ironic that you think market psychology is negligible considering you're obviously unable to take sarcastic critiques of your stupid strategy.
It's not as good of a predictor to real trading because of both psychological issues and the unpredictability of markets. Something that does really well in simulation may not end up doing as well in real life for various reasons. Depending on how you are "paper trading" and what it is that you're trading, there are going to be various differences that can affect real vs pretend dynamics.
The obvious issue is that you will tend to panic or be overconfident with an inability to be methodical. That's the biggest psychological issue and it's a very human trait. It happens to everyone. It's incredibly difficult to remove yourself from that. You will also not be able to get the execution you would in real life. Again, this really depends on what you're trading. If you're trading currency, then it's probably the worst because those platforms will fuck you sideways and wipe out your stops. You're trading with a computer that cheats in that scenario. It doesn't mean you can't make money, but you'll be surprised how somehow you get triggered when it seemed "impossible". If you're trading futures, then your biggest problem is getting wiped out on margin calls. Futures are fairly volatile, so there is a good chance that you will get closed on a margin call when a position moves strongly against you, especially if you don't have a lot of capital. A 5k account can buy 1 contract of a limited number of contracts and each tick is a huge movement. This will get your contract closed very easily. A 100k account can obviously handle more volatility and buy more contracts, but thats where the emotions kick in more. You're not trading house money here, you're trading your own money, so 100k and losing 20k is a serious emotional and psychological issue. Trading 100k of someone else's money or fake money isn't.
A lot of people trade on technicals and a lot do well trading that way. However, if everyone were able to flip money so easy using technical analysis, there would be a lot more big time money managers.
Most people aren't being a dick to simply be a dick. It's just that a lot of us have heard about how "easy" trading is, and how someone is "killing it paper trading". They all think that they are smarter than the next guy. It's a zero sum game. Maybe you're going to be the next rockstar. I don't know. I do know that I (and I'm sure Eddie and Ravenous at least since I'm not as familiar with some of the other posters) have heard a million dudes say they have a fool proof strategy and that trading is easy.
Thats all just my opinion though. So take it for what you will. Good luck with your trading. Success stories are always great, so let us know if you end up killing it.
Thanks for the advice.
Pissed at myself for contributing, but NO not everyone is able to do this. Lots of what you are doing is probably zero sum, so its a tautology that not everyone is doing it. If you can do this, you are the best investor in the world.
Although I notice your daily return has dropped from 50% in day 1 (1800/3500) to just 1% currently (1800/216,000, which is your base if you made 1800 every day for 6 months). Its amazing how lousy you are relative to how good you used to be. Too old for the game now?
I can't tell if you're being sarcastic...
Well if it doesn't work out, you can always buy my get rich on options book for $59.99.
Just do the math, that's extremely high, but wont last. I think any new trader has that moment.
Put some real money into a account and see how you do after a month.
By the way my broker has very low margin rates $500 for ES, ZN, and ZB which are the three i trade the most which means if i start with 5 grand that's 10 contracts or $125 per tick for ES and $350 bucks per tick for ZB and yes, i have been approved for full margin privileges.
.
being a zero sum game where there is a loser and a winner on every side what would be the out come if "every one could do this" lol.
but on a serious note i have had both real and paper accounts and the returns are much better on the paper because i throw the ballsy trades levered to the hilt and to be honest like you am often right. until you fund a real account to me those numbers mean nothing because psychology is the hardest thing to control in these markets. we are pre disposed to fail in the market and hard wired that way so when that is eliminated it makes trading a piece of cake. like the others i would encourage you to play with you own money and all the power to you if you can replicate your results. best of luck!
Op is prob picking up pennies in front of a steamroller. Good luck
What you don't seem to understand is that if you are making those returns on those futures with the maximum leverage you are taking a HUGE amount of risk. And that ALWAYS ends up badly. I know you said you only lost 1 or 2 days, but one day the market will move strongly against you and you will not only lose all the money you made but you will also probably be in in quite some debt.
Yeah i've been hearing this a lot. Thanks for the feedback.
True. This can't be realistic. I thought I knew the shit before I started to work as a trader. Man, was I wrong. Paper trading is not the same as trading on your own account and far from working as a trader.
I don't know why we're wasting our time explaining the differences in psychology between paper trading and trading to this guy. I remember in 7th grade when I went to dad to brag how my paper portfolio was beating his real one by 5%. He looked at me funny, laughed really loudly, and told me that the difference was that his portfolio had to fund my college tuition while mine was a bunch of meaningless data stored on some server's hard drives. He then asked me if I was managing the portfolio that funded my college tuition if I would be still up by 5% or if I would be crying to my mom in three days. I caught on to the difference pretty quickly right there.
Not gonna make a judgement one way or the other on what the case is here, but a lot of the ribbing you're gonna get from the WSO community is typically for your own good. Nobody is going to start trolling you unless it's something we've heard over and over (unfortunately the case with the "I have a trading strategy with 5000% returns" thing goes) but take it in stride and it's no big deal. If anything you'll get the point, and I'm sure by now you know that there's plenty of people who have tried taking their strategy off paper and into the market and had it blow up in their face pretty quick. Some have been successful too, so if you want to give it a try do it with a small amount of money (could be $5k, could be $10k) and see what happens. You could end up like the guy who made $1k into $100k in 2 weeks, just not broke a month later (lol)...
good words blackhat, good words. way to be an encouragement. i know that sounds patronizing, but seriously, all arrogance on here is quite unfathomable at times, and mostly humorous. understandable though, since it's the internet and we all say whatever we want to on the internet, now don't we....
It's like playing poker with just chips and no money....complete shit show
After seeing some of the posts here, I find it hard to believe that I was once accused of 'trolling'.
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