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Strategies & Market Trends : Systems, Strategies and Resources for Trading Futures -- Ignore unavailable to you. Want to Upgrade?

To: Chip McVickar who wrote (39612)	10/29/1999 12:45:00 PM
From: Tom Trader	Read Replies (1) \| Respond to of 44573

Chip, you make some good points The purpose of the contest and how it is being used by various contestants varies. I, for instance, am using it to test out alternative systems and try out day trading in earnest. I have gone lightly short for the contest based on testing out a concept that I have discussed with a couple of people on SI -- but I am trading against the trend on a day when the spoo is showing signs of breaking out. I am not doing this with real time trading -- at least I will not until I see some signs of the momentum abating. There really is not a need for money management rules being modified for the contest -- basically, I suspect that given that this is to last for 5 more months, poor money management will result in some contestants crashing even if they are riding high at some point. I think one of the measures of how well a contestant is doing is to see the extent of the worst draw-down experienced. Anyone who has traded futures knows that when a draw-down is extreme, it can affect ones trading persona and decision making. Re contests and the approach to them -- you are right in that it does encourage the gun-slinging approach. Not sure that gun-slingers have much durability when it comes to futures trading. If you read Schwager's books about great traders that he has interviewed it seems like the approach of the really successful traders is discipline, money management and such elements -- and they are the ones who have been around for decades. As far as comparisons to live trading -- quite honestly there are so many variations to reality that it makes a comparison almost meaningless. This ranges from the size of positions that one takes to how fills are recognized. For example, I placed a limit order to buy several contracts at 3:16pm at 1293, two days ago when I saw it turn with Lind-Waldock --it did not get filled because though the spoo ticked down there at about 3:17+, it did not go through that level and so it was "unable". In the contest we always get a fill if the price is touched. One of the easiest ways to come out ahead in the contest -- and I don't even know if anyone has tried it -- is to place two orders using a buy stop and sell stop a minute or so before a major report/news is to come out at a couple of points above and below where it is trading. Depending on whether the news is bullish or bearish the stop would be triggered and one would be in the money in a substantial way most of the time. Think about recent reports and how the market has reacted -- the Fed decison, the inflation #s and so on -- one could have made a bundle. I even thought of doing it but felt that it would not be in the spirit of the contest even if it was in compliance with rules. Now you could try and do this in real life as well -- but your stop would be blown and the fill would be something terrible which would defeat the purpose of the trade in many cases. However, in the contest we'd be filled at the stop -- which just would not happen in real life when there is a major piece of news that affects the market. All of this is academic -- and I think that we should just continue on the lines that we have been doing and let contestants do what they see fit. But it would be a mistake to confuse trading results achieved in the contest with what happens in reality for the reasons mentioned. Oh yes -- about Myrtle Beach! I was there about a decade ago at a time when I was gainfully employed in a conventional sense and used to be a co-lecturer at some seminars that were put on bi-annually -- not my favorite place, I must confess. A lot of people do like it, though.