The 10K Thread
- Thread starter the golden gun
- Start date
P
Piper
Guest
;DAlpha-Bet said:
:greedy:
shopster said:
GG screwed you! :-\ Shame on you GG.. No honor left in this world anymore..
Pay up GG!!!! 8)
the golden gun said:
I'm pretty sure every trader makes a compounding growth table like that on their own at some point. I sure did way back when I first started out. It's just too easy to get focused on the upside when projecting compounding gains like that... but I haven't been a fan of such tables for some time now.
The weak point I see relates to setting goals: The moment you combine that compounded returns table with a calender or time horizon, you create an incentive to over-trade and revenge trade. I talk a bit about this influence in the Points not Dollars section of my thread series. (For clarity, the take away from that link is to keep score in some non-monitory unit, like pips or ticks, but not use an arbitrary unit based daily/weekly/monthly goal in general. Work an edge, let the P/L takes care of itself.)
So yeah, it's great to see what some compounding can do.. but, IMHO, try to avoid going to the next level and attaching some arbitrary goal in a fixed time interval.
TheInnerCircleTrader
Well-Known Member
Time is a currency of it's own.
We spend it on things we shouldn't and try to save it when we can't. Time spent setting goals is profitable and time spent worrying is not.
Setting time-based goals in my opinion is a great idea. Assuming the goals are in the realm of reasonable. Is it reasonable to set a goal of 15% return per month for someone just learning... clearly not. Is it reasonable for the same person to set a goal to arrive there eventually... absolutely.
Setting low end goals like - "I aim to net 50 pips over the week..." is finite and reasonable.
It is:
Realistic.
Plausible.
In the scope of possible - as the weekly range in all pairs supports the conditions.
What those 50 pips does for the person is something all together different however.
If the person risks too much in their pursuit of those 50 pips, pain and emotional distress are a result. Psychology comes into the fray and the 50 pips goal is blurred and getting lost funds is now the goal. From Sunday to Friday the clock ticks down. The battery on volatility drains... so the person "forces" the goal - that perhaps has moved into the realm of improbable now - into a smaller less likely condition. This is the reason Time based goals hurts weak minded and emotionally driven Traders.
Having a sober mind and clear perspective like this helps the cause:
While aiming for 50 pips per week - some might result in a negative week.
Over the course of a month the "average" per week might align with 50 net pips gained.
The course of a three month period will further smooth the "average" to 50 pips.
Wearing binoculars while you look at your sheet of goals will only cause you to lose sight of the goals... and the focus on the minors will replace the majors you need to keep your eyes on.
GLGT 8)
We spend it on things we shouldn't and try to save it when we can't. Time spent setting goals is profitable and time spent worrying is not.
Setting time-based goals in my opinion is a great idea. Assuming the goals are in the realm of reasonable. Is it reasonable to set a goal of 15% return per month for someone just learning... clearly not. Is it reasonable for the same person to set a goal to arrive there eventually... absolutely.
Setting low end goals like - "I aim to net 50 pips over the week..." is finite and reasonable.
It is:
Realistic.
Plausible.
In the scope of possible - as the weekly range in all pairs supports the conditions.
What those 50 pips does for the person is something all together different however.
If the person risks too much in their pursuit of those 50 pips, pain and emotional distress are a result. Psychology comes into the fray and the 50 pips goal is blurred and getting lost funds is now the goal. From Sunday to Friday the clock ticks down. The battery on volatility drains... so the person "forces" the goal - that perhaps has moved into the realm of improbable now - into a smaller less likely condition. This is the reason Time based goals hurts weak minded and emotionally driven Traders.
Having a sober mind and clear perspective like this helps the cause:
While aiming for 50 pips per week - some might result in a negative week.
Over the course of a month the "average" per week might align with 50 net pips gained.
The course of a three month period will further smooth the "average" to 50 pips.
Wearing binoculars while you look at your sheet of goals will only cause you to lose sight of the goals... and the focus on the minors will replace the majors you need to keep your eyes on.
GLGT 8)
Jack said:
I came up with "Risk Adjusted Pips per Week" for my goal projecting, which has worked well so far, though getting the progression calculations to work for what a multi-week compounding ends up being took some work. (If you target 4% per week, what is 3 weeks, compounded, valued at the 3rd week in the first week? i.e. if you nail 120 risk-adjusted pips in a week, where does that leave you?)
I also have a spreadsheet for progression, but I looked at it a lot to convince myself this wasn't a complete waste of time.
InnerCircleTrader said:
Yes, but I feel there's a huge difference between aiming to 'average' 50 pips per week over such a long period of time that week-to-week results end up being noise, and directly setting a weekly goal of 50 pips...
One is something you can work toward and might help if that's your bag... the other tempts you to put on that 'one last trade' because you're at 48 pips and need to meet your target.
We'll always find that 'one last trade' if we look hard enough, regardless if it's worth the risk or not.
sqa said:I came up with "Risk Adjusted Pips per Week" for my goal projecting, which has worked well so far, though getting the progression calculations to work for what a multi-week compounding ends up being took some work. (If you target 4% per week, what is 3 weeks, compounded, valued at the 3rd week in the first week? i.e. if you nail 120 risk-adjusted pips in a week, where does that leave you?)
I also have a spreadsheet for progression, but I looked at it a lot to convince myself this wasn't a complete waste of time.
Sure, position sizing progression, based on equity and risk.. that's not bad. And a general compounding table isn't the devil... I did say how it's nice to see what's possible.
I just feel the positives start to get outweighed by the negatives once you start setting a time table for how much you'll be trading in a year's time because you're weekly goal X and compounds at a rate of Y.
I know I'm going to differ from other traders here on this subject, and I'm 100% ok with that... the individual either identifies the tool as worth keeping or discards it should it prove more a distraction from their plan than anything else.
Personally, I just like to focus on what's going on right now. Either there's a valid setup and I'll take a trade, or there isn't and there's no trade yet... a daily goal won't change that.
Jack said:
As you might not find too surprising, I quite agree. And if I didn't, the USD-JPY would have driven me insane already.
Trades present themselves when they present themselves, not when you want them to appear. Which is why I spent a while to figure out how to do the outer-week "make up" value and/or forward value calculation. Puts the focus far more on proper entry and execution more than raw pips. Granted, the first Priority of Trading is always: Watch your 6!
rod178 said:
You're going to run into various degrees of asshats in any online community. Some people's personalities are just going to clash with others.
Sometimes, a good argument ensues, and the observers end up gaining something by reading it. Constructive outcomes to conflicts like that is my ideal goal (...and really, one of main reasons online forums are useful.) I do realize that's not going to happen every time there's a conflict. Sadly, this thread, might be an example... and lately I've grown concerned with the increase in personal jabs I'm seeing in place of constructive dialog. But, if we want to keep the forum unbiased and open, then we have to accept that not everyone will think and act the same...
In contrast: If we lock the place down and only talk about one specific method -- in a strictly positive way -- while insta-banning anyone who objects or even shows a little skepticism... that would take away from the credibility of the site and everyone involved.
We are either a neutral forum where minds meet to exchange ideas and grow (dealing the best we can with the riffraff that shows up,) or we're all drinking the kool-aid and ex-communicating defectors. There's less drama but not much of a future in the latter.
the golden gun
RINSE & REPEAT
So let's recap what I missed this morning:
-a Cameo by ICT (Hi ICT, happy belated birthday!! 42 years young!)
-a Forums suicide by rod178. Let's hope he isn't catholic!
-a thoughful Speech on the importance of Moderator's neutrality by Jack
Everyone can critique me in a lot of different ways, but one thing you have to admit... I know how to liven up a trading forum! I thought everyone would appreciate a more active and stimulating trading forum experience
-a Cameo by ICT (Hi ICT, happy belated birthday!! 42 years young!)
-a Forums suicide by rod178. Let's hope he isn't catholic!
-a thoughful Speech on the importance of Moderator's neutrality by Jack
Everyone can critique me in a lot of different ways, but one thing you have to admit... I know how to liven up a trading forum! I thought everyone would appreciate a more active and stimulating trading forum experience
the golden gun
RINSE & REPEAT
Jack said:
I appreciate the point you're making here. I actually struggled a lot with that exact problem in my earlier years.
Now, I know my JOB is to scout and execute on high probability setups. That's what I focus on, that is where my mindset is. But at the end of the week/month, I'm the type that needs a Benchmark. I want to "grade" my own performance. The purpose is to develop something of a pace.
If I'm underperforming, I'm likely wasting time and opportunity, and that is undesirable. If I'm overperforming, I might overheat the ol' Ego and overtrade due to pure Greed; also undesirable.
the golden gun
RINSE & REPEAT
garry said:
I will cherish this brief moment of unconditional encouragement and positivity.
Thank-you.
the golden gun
RINSE & REPEAT
Alpha-Bet said:
I think most new traders understand this concept.
Sometimes it ends up like this though:
see trade. execute trade. lose. move on to next trade
see trade. execute trade. lose. move on to next trade
see trade. execute trade. lose. move on to next trade
see trade. execute trade. lose. move on to next trade
see trade. execute trade. lose. move on to next trade
see trade. execute trade. lose. move on to next trade
see trade. execute trade. lose. move on to next trade
see trade. execute trade. lose. move on to next trade
see trade. execute trade. lose. move on to next trade
see trade. execute trade. lose. move on to next trade
see trade. execute trade. lose. move on to next trade
margin call.
P
Piper
Guest
the golden gun said:
Then whoever sees that, should learn to trade