Get Consistent Profits--- Futures Trading

— a trader’s story
One of the mistakes I consistently made in my early years trading experience was to try to make too much money in relation to my trading capital. To make £1000 a day while trading with £10,000 is absurdly ambitious; of course I have done it many times, and I have also failed more than once. To have the aspiration of taking £1000 out of the market each day, when trading with £10,000 or under is, I think, a quick route to the poor house.
So what is a reasonable objective for a day trader?

I visited an ex-floor trader who has established a trading operation backing young aspiring traders a few weeks ago. What interests me is how he trains his team. The essence of his approach is to give them a grounding in discipline and confidence. He believes that confidence is one of the primary keys to success in trading and that confidence is a by-product of taking money out of the market. One of the reasons he has chosen to work with young traders is that he wants people who have minimal financial commitments. He knows it will take a while for them to start earning an income from the business. So his belief is that if his traders can regularly take small amounts of money out of the market, their knowledge and confidence will grow and in time they will become bigger traders.

futures-tradings.comIf we want to become consistently successful traders we need to take a different tack than if we are just out to make as much money as we can today.
So back to the question, what is a reasonable objective for a day trader? Well let’s look at bringing our daily target right down to £100, with £10,000 of trading capital, i.e. 1%. Now £100 a day, trading a market like the FTSE seems an achievable target to me. That is a net profit of 10 FTSE points a day. Can you come up with a system that trades 5 times a day and has an average net profit of 2 points? Or a system that trades 10 times a day with an average net profit of 1 point?

If you can make an average of £100 a day you will double your money in 100 trading days i.e. 20 weeks or about 5 months. If you double your position size every time you double your money, your account will grow to £1,000,000 in 140 weeks, which is less than 3 years! Of course this does not take into account the impact of tax; but my point is that by taking a low risk, conservative approach to trading objectives, we give ourselves the chance to grow and develop into traders, while also availing ourselves of the possibility of a deceptively good return.
Direct access trading effectively gives everyone the same low costs, immediate trade execution and access as was exclusively enjoyed by the floor traders before the advent of the electronic market place.

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