A Word of Advice
This is the main educational section of this site. As someone who has spent well over a decade trading various financial instruments, I believe I have a pretty good idea of what works and what does not and what can make you money and what, and also who, you should avoid.
Among many other things, this section is thus dedicated to the issues of critical thinking and the trader advocacy. As a matter of fact, its very first article already sets the tone for these topics. But the main topics covered here are those related to emini trading, emini trading systems, or trading systems in general, and, although to a lesser extent, those pertaining to stock trading.
I hope to be adding to this section rather often and may also include here some high quality articles written by others if I think that they belong in here. You may want to check it out frequently.
For more information about emini futures and emini trading, largely of introductory nature, please also see the section of Emini Day Trading.
1. Emini Trading: Sham and how to spot it
Sham is ubiquitous in the trading world. The majority of vendors hide the truth about their systems or courses in one way or another and some of them misrepresent things or plainly lie. Almost everyone falls for this at least once, some more often. I compiled here a list of more obvious signatures of sham so that you can protect yourself better from the people who are hell-bent to get your money or at least to waste your time with the products that are much less than genuine. [read more...]
2. Emini Systems: Simple can often be better
I would like to present here a very simple system that I call PAB (whatever that means). The system is based on three pillars that every sound trend-following system should rest on: [read more...]
3. Emini Systems: Reality check or can you count?
Let's analyze System1 from this page . As you see, in 2005 this system made 159.75 ES pts. It accomplished this with exactly 497 trades, which amounts to about 41 trades per month on average. The profit I quoted is hypothetical. Hypothetical profits are for vendors (that's where the word 'hype' derives from). As traders we should be interested in actual profits. Let us estimate it then. [read more...]
4. Emini Systems: How to choose a trading system?
If you are new to system trading, after reading the previous article you might feel a bit uneasy about the whole business. That's good because you should. There is a vast wild jungle out there with swamps scattered all over rather generously. One false step and you just said good-bye to a nice chunk of dough. [read more...]
5. Emini Systems: Seen a Holy Grail lately?
The Holy Grail in trading is understood as the system that never fails. Not even once. It just keeps on piling profits, day in day out. A system like that obviously does not exist, which somehow does not prevent people from trying to find it. [read more...]
6. Emini Systems: Free trading system: BC
This is a very simple mechanical system that uses no oscillators. The only indicators it employs are those of the moving average and bands variety. [read more...]
7. Emini Systems: Why mechanical systems fail
For two main reasons. Either the market refuses to cooperate or the developer refuses to accept the trading reality. It is the latter case that is much more serious and can do more damage to your account than the former. [read more...]
8. Emini Systems: Equity curve simulation
One of the few positive things that came out of the research on nuclear weapons was the development of computer simulations that came to be known as Monte Carlo simulations. [read more...]
9. Emini Systems: Trading systems terminology
Trading systems have their own terminology that defines the parameters determining the system quality. [read more...]
10. Emini Trading: Rollover and expiration days
11. Emini Systems: A system or a method?
On this site I offer a few trading systems and two trading methods. The systems are purely mechanical and you can use them to trade ES or ER2, two very popular emini instruments. One of the methods is for trading stocks, the other for trading breakouts in ES. All have been originally designed by me. [read more...]
12. Stock Trading: The securities fraud
The securities fraud is an act committed by an entity intending to manipulate the market through deliberate concealment, or distortion of information. [read more...]
13. Stock Trading: The best way to trade stocks
With the stock market reaching new all time highs, you are probably wondering if it is a good time to be in stocks. [read more...]
14. Emini Trading: The allure of daytrading chatrooms
Many people dream about becoming day traders. Many have tried to make money this way trading individual stocks or emini futures. Most have failed or will fail. [read more...]
15. Emini Trading: Do you need a high winning rate?
It's certainly good to have a trading system for your favorite emini futures market which boast a high winning rate. Say, over 60% or even over 70%. [read more...]
16. Emini Trading: How many trades a day?
How many trades a day do you need to take to make a decent living? Let's see... [read more...]
17. Emini Systems: Which emini systems for 2008?
I started trading emini markets in 2002, in the second half of the year that coincided with the height of the post dotcom bubble recession. I focused on ES, the emini of the full futures contract of S&P 500. [read more...]
18. Emini Trading: Too much self confidence trading eminis?
Well, I don't think there is such a thing as too much self confidence. Most people would probably agree that if anything they need more self confidence rather than less. [read more...]
19. Emini Systems: The butterfly effect in emini trading systems
Emini futures, commonly referred to as simply eminis, are among most popular trading vehicles out there. Their popularity is particularly high among day traders, especially those on tighter budgets. [read more...]
20. Emini Systems: Albert Einstein and emini trading systems
Albert Einstein was born in 1879 in a small German town of Ulm. He died in 1955 in Princeton, a small town in New Jersey, USA. He was a theoretical physicist, first and foremost, although it is not so unusual these days to see questions "what would Einstein do?" related to things that have little to nothing to do not only with theoretical physics but with science in general. [read more...]
21. Emini Trading: Can biorhythms help you in trading eminis?
Do you believe in biorhythms? Should you? Is there any advantage to taking them seriously? Would they help you in your day trading of emini markets? Or in your life in general? That's what we will address in this article. [read more...]
22. Emini Systems: Are simple emini systems of any value?
According to Comrade Napoleon, a chief character of "Animal Farm," a famous Orwell satire, "all animals are equal, but some animals are more equal than other." [read more...]
23. Emini Trading: Basic introduction to day trading emini futures
Have you ever thought about day trading for a living? I am sure you must have at least heard about it, right? Yes, there are people doing it for a living, some making big bucks in the process, others losing their shirts, trophy wives, and mortgages. Not necessarily in this order. And I am quite positive that you would rather be in the former category. [read more...]
24. Emini Trading: The essential ingredients of successful emini trading
Day trading emini futures markets can be a very lucrative occupation. And while you can do this from the convenience of your home, it's very important to approach it as a business and not just some costly hobby. In fact, only those who treat this occupation strictly as a business truly succeed in it as opposed to getting lucky for a while. Even a longer while. [read more...]
25. Emini Trading: Is trading emini futures for you?
No, it's not. [read more...]
26. Emini Trading: Using simulators for trading emini futures
Emini futures, or simply e-minis, are smaller-sized contracts of "full-grown" futures contracts that have been around for decades. Unlike the latter that have been traded on physical exchanges, eminis have always been traded electronically, allowing retail traders with access to the Internet to compete against institutional traders from the comfort of their homes or home based offices. [read more...]
27. Emini Trading: How to start trading emini futures
Emini futures, or just e-minis, are enjoying an incredible popularity among small traders, the real "moms and pops" of the modern trading scene. To those new to the subject, eminis are simply smaller-sized contracts of "full-grown" futures contracts that have been around for decades. Unlike the latter that have been traded on physical exchanges, the former have always been traded electronically, which explains what the "e" stands for. [read more...]
28. Emini Trading: The failure to cut losses short revisited
To those unfamiliar with these trading instruments, emini futures, or simply e-minis, are smaller-sized contracts of "full-grown" futures contracts that have been around for decades. Unlike the latter that have been traded on physical exchanges, eminis have always been traded electronically, allowing retail traders with access to the Internet to compete against institutional traders from the comfort of their homes or home based offices. [read more...]
29. Emini Trading: What exactly is emini day trading?
Emini futures, or simply e-minis, are smaller-sized contracts of "full-grown" futures contracts. While the latter have been around for a few decades, the emini products are relative newcomers to the trading scene, having been around for about 10 years only. Moreover, unlike their older "siblings" that have been traded on physical exchanges, e-minis have always been traded only electronically. That's what the "e" in their name stands for, namely "electronic." [read more...]
30. Emini Systems: The logic behind emini trading systems
I could equally well call this article "The lack of logic behind emini trading systems" as, in fact, sometimes such lack illustrates better what the proper logic should be. And that's what this article will focus on, the lack of logic in emini trading systems. We hope that exposing the lack of logic in such systems will enable us to come up with the right logic, the logic needed to design good, robust emini systems. [read more...]
31. Emini Trading: Discretionary versus mechanical emini trading
Similarly to many other trading vehicles, emini futures can be traded in two significantly different ways: through mechanical systems and by using discretion. The difference between the two is not always quite well understood by beginning emini traders. [read more...]
32. Emini Trading: Should you use indicators for your trading?
Let me be brief, so you don't waste your time on some people who happen to fall into two camps. The camp that says that indicators don't work and the camp that says that you can trade using only indicators without even looking at the price bars. [read more...]
33. Emini Trading: How to use indicators for your trading?
You can trade emini futures using indicators. You can also trade eminis without them, meaning by relying only on the price action and, perhaps, some simple tools like straight lines. [read more...]
34. Emini Trading: Is discretionary emini day trading right for you?
There are two distinct styles to trade emini futures. One is purely mechanical, the other is purely discretionary. It's possible to use a hybrid approach, but in reality, this is often not that advisable as you simply end up with what is just more complex mechanical emini trading. Some people prefer a mechanical style, others feel better with the discretionary approach to emini trading. Both are fine, but one is clearly better than the other, especially for retail traders. It is the discretionary trading style. [read more...]
35. Emini Trading: How I lost $10,000 in one day trading eminis and what I learned from that
Well, I really didn't. I never lost that much in one day. Ever. And I don't plan on that either. Trading eminis or not. But I thought that this would make a perfect, catchy line. To grab your attention, that is. You know, marketers do this all the time. Except that they never admit that this is only a fib. Wouldn't it be nice if they once, for a change, admitted how full of it they are? Yeah, I thought so too. [read more...]
36. Emini Trading: The secret meaning of the marketing speak
Have you noticed how often Google ads contain the word "secret." That's also true when it comes to ads dealing with emini trading systems or strategies. Yes, apparently there are some secret things out there. Well, that may be true. It's conceivable, I would say. Sort of. Except that these secret things are very unlikely to have anything to do with the markets, but a lot to do with marketing. [read more...]
37. Emini Trading: The dumbest way to start trading eminis
You want a short answer with that? Well, here we go then. The short answer first. [read more...]
38. Emini Trading: The worst thing that can happen to you when trading eminis
Incidentally, that applies not only to trading eminis, as emini futures are often referred to, but also to trading stocks, or currencies. I suspect that you will find that this applies quite well also to many other situations that have little or even nothing at all to do with trading. [read more...]
39. Emini Trading: Trading eminis with right expectations
Emini futures, often referred to as simply eminis, are very attractive day trading instruments. You can trade them with only $3,000-5,000 in your account, assuming you want to do this with 1-2 contracts, which is about the right size for the beginners. [read more...]
40. Emini Trading: On uses and abuses of emini trading systems - Abuses
Let us start from the abuses. If only because they are more common. [read more...]
41. Emini Trading: On uses and abuses of emini trading systems - Uses
In the first part, we discussed the abuses of the idea of the trading system. And while we were mostly interested in emini futures trading systems, the problem of abuses is pretty much common also when it comes to stock and Forex trading systems. [read more...]
42. Emini Trading: Starting in emini futures trading - ES or YM or perhaps something else?
Emini futures contracts have become a trading instrument of choice for many traders, especially day traders. The field that barely existed only 10 years ago is now booming with new traders joining the older ones every day. With many brokers, their numbers growing as well, dedicated primarily to serving this class of traders, this trend is likely to continue. [read more...]
43. Emini Trading: Using video recording to improve your trading
Recently I spent several days working just on recording videos for my very popular emini trading course. While doing so I came up with some ideas on how you could use video recording of this sort as a useful aid in mastering the art of emini trading. I would like to share them with you in this article. [read more...]
44. Emini Trading: Are you emini trader material?
Emini futures that this article is concerned with are very popular trading vehicles among retail day traders. There are a few good reasons why this is so, two of which certainly stand out. One is the relatively low deposit needed to open an emini trading account, often of the order of only 3,000-5,000 dollars, the other is the fact that emini futures can be traded from the comfort of one's home. [read more...]
45. Emini Trading: Emini trading and the theory of relativity
I am a physicist by training. A theoretical physicist, to be more precise. I have spent many years studying things like general relativity (black holes and the Big Bang are probably the most popular buzzwords here) and quantum theory (with its paradoxes and cats, like Schroedinger's). [read more...]
46. Emini Trading: To day trade eminis or to day trade stocks?
Now, that is that question, isn't it? We believe we may have some good answer to it. In what follows, that is. [read more...]
47. Emini Trading: Emini futures - the best markets for day trading?
Emini futures markets are growing in popularity. Having actively traded them for over 7 years now, I have witnessed their growth personally and I don't think I would ever want to switch to trading anything else. Because of that, the answer to the subtly phrased question in the title of this article has to be a decisive "yes!" Yes, indeed, the emini futures are, in my humble yet educated opinion, the best markets for day traders ever created and in what follows I will try to substantiate this opinion with what I believe are convincing arguments. [read more...]
48. Emini Trading: The real emini trading secrets - Why trading forums suck
The answer to this question is quite simple, but let me answer it by posing yet another question. And why not? No, that's not the question I really wanted to pose... [read more...]
49. Emini Trading: Momentum, trend, support
Three basic elements all traders rely on in their pursuit of profit are momentum, trend and support. But that's only the basics that are not necessarily guaranteed to make you money. [read more...]
50. Emini Trading: Emini trading and the Iraq exit strategy
Suppose you are an e-mini day trader, as some people are or inspire to be these days. What's the most important question you should ask before entering a trade? The answer: how to exit it. This may apply to more than just trading, but in trading, especially day trading emini futures, not knowing the answer to it may cost you a lot, a whole account, in fact. Plus a marriage, if you are really unlucky. [read more...]
51. Emini Trading: The trading learning curve
I sometimes get the question from people interested in KING, an emini trading course that I have been offering on this site for a few years now, about the course learning curve. [read more...]
52. Emini Trading: How many charts do you use for trading?
Some 9 years ago, when I was starting my emini day trading career, I got myself 3 monitors and hooked them up to my computer, a Compaq, that back then was running Windows 98. I was really proud of these monitors, the biggest of which was a real monster, a 21-inch piece of hardware that I got relatively cheap online. [read more...]
53. Emini Trading: What it takes to be really good at something (including trading emini futures)
I took this piece of advice from, of all places, mathoverflow.net, a site for serious math buffs, many of them professionals, so you can trust it because these guys mean business. Not to mention that they are smarter than a typical wannabe trader who will most likely ignore it. This advice, that is. But that would be his loss. Again. [read more...]
54. Emini Trading: Oversimplification (not only in trading emini futures)
I like reading, and I don't mean only the Internet stuff, that I spend probably too much time on, but books as well. The books I read are mostly non-fiction, including popular science and math books, rarely fiction. [read more...]
55. Emini Trading: E-micros - the little siblings of e-mini futures
Did you know that futures have something in common with (artificial) Earth satellites? If you are not a scientist who trades futures for a living you probably did not. We can fix it, though. [read more...]
56. Emini Trading: Why most people do not succeed at day trading emini futures
There could be more than one reason for that, but one definitely stands out and it's universal: they simply give up. [read more...]
57. Emini Trading: Nasreddin Hodja and trading forums
Nasreddin Hodja, who allegedly lived in Turkey in the 13th century, is a popular figure in the Turkish and Middle Eastern folklore and the subject of many folk tales. [read more...]
58. Emini Trading: Emini trading do's and don't's
They can easily apply to trading other instruments as well, but since I am an emini day trader, I chose to focus on this particular trading vehicle. [read more...]
59. Emini Trading: The expected value for the intelligent emini day trader
The expected value (also known as the expectation value) is truly a fundamental concept in trading. It is also a fundamental concept in gambling and it plays the same role in both: it determines your edge. [read more...]
60. Emini Trading: Learning how to trade emini futures from the masters
In one of the previous articles in this section, entitled "What it takes to be really good at something (including trading emini futures)," the following piece of advice appears: "Study the masters." [read more...]
61. Emini Trading: Ed Thorp and his 98.7% winning rate
In another article in this section, I was talking about high winning rates, the rates so high that to the unenlightened they may seem too good to be true. I talked about numbers as high as 95% or higher, which translates into 95 (or more) winning trades out of 100 total. [read more...]
62. Emini Trading: Some useful quotes for emini traders
What follows is a somewhat eclectic collection of quotes that I believe can be of some use to e-mini traders, wannabe traders, day traders, and traders in general, and many other people no matter what they do or intend to do for a living. [read more...]
63. Emini Trading: Day trading e-mini futures can be easy
Or at least, it does not have to be hard. Well, not all the time. As a matter of fact, I think it should be easy most of the time, which still does not mean always. I am not going to kid you that it should always be a dead cinch. [read more...]
64. Emini Trading: E-mini trading, scam, and spam
A few days ago, around December 20th, 2012, I ran into some problem with Yahoo! Mail. Simply put, Yahoo! was blocking my messages from being sent implying that I was sending too many of them or perhaps even mass mailing. [read more...]
65. Emini Trading: Economic reports and their impact on the e-mini futures markets
This week brings a slew of US economic reports. I mean the week that spans the last days of January and the first days of February 2013. Do such reports affect the futures markets, e-mini futures, in particular? [read more...]
66. Emini Trading: Should you start a hedge fund in high school?
You can probably guess a short answer to this question. How about a long one? Well, read the whole damn article. [read more...]
67. Emini Trading: Should you switch to a new e-mini contract on a rollover day?
Many futures contracts (including e-mini futures contracts) roll over to a new contract on a certain Thursday in March, June, September, and December. They have to because the old contracts are bound to expire within a week or so. Among them are all US stock index futures and their e-mini counterparts. That means, ES, NQ, YM, TF, and a few other more or less popular among e-mini futures day traders whose ranks seem to keep growing. [read more...]
68. Stock Trading: Mila Munis as a contrarian stock market indicator?
Mila Kunis has become one of the most popular Hollywood actresses of the young generation. At 29, she is not anymore the Jackie of "That '70s Show" that introduced her to the American public. Or, at least, that's where I first saw her. This show is the only sitcom that rivals Seinfeld, in my opinion, and I say so as a die-hard Seinfeld fan. [read more...]
69. Emini Trading: The very basics of e-mini trading for the very beginners
I get contacted by newbies time and again. And while I have written quite a number of articles just for them (in this very section and also in the special e-mini educational part of this site), one more is unlikely to do any more "damage," although damage is really not my goal here. [read more...]
Disclaimer: HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN INHERENT LIMITATIONS UNLIKE AN ACTUAL PERFORMANCE RECORD. SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT BEEN EXECUTED, THE RESULTS MAY HAVE UNDER OR OVER COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE SHOWN.
|Copyright Waldemar Puszkarz © 2005-2013.|