New Traders Can Succeed in Markets: New Funded Trader, Alexandra (Orlando, FL)

Posted by TopstepTrader on September 26, 2017

Funded Trader Alexandra.png

Three Trading Lessons from Alexandra's Success:

New traders welcome: Alexandra has been actively trading markets for less than a year. But she demonstrated in the Trading Combine® and Funded Trader Preparation™ that she has the right temperment and outlook to be a profitable trader. Among her greatest self-identified strengths: discipline, motivation, focus and patience. With that blend of strengths, Alexandra will be unstoppable. 

Don't force trades: We like seeing traders more active on some days, while being inactive or barely active on others. That means that they are being discerning in their trades. There were three trading days during her Funded Trader Preparation that Alexandra only traded one time. And it's not like she was in the position all day - she was in the trades for anywhere from 15 to 40 minutes and made less than $100 each time. Better to see an opportunity missed than to force something. 

Caution: winning trade vs losing trade size: One thing that created a giant red flag was Alexandra's losing trades versus her winning trades. She lost $420.69 per average losing trade, while her winning trades netted her just $145.47. She was able to stay profitable in that scenario given the fact that her winning trade percentage was 86.36%. However, that is unsustainable. If her winning percentage slides to just 75% - still an incrediblly high percentage relative to most traders - she will barely be profitable using these same average win / loss statistics. This should be a giant warning sign heading into a Funded Account

Three other observations from Alexandra’s trading:

  1. There will be a lot of variability in performance, but large winning days can make up for a lot. A lot of traders will want to make an average of $200 or $300 per day. While that is possible, it's important to note that it is an average. For example, Alexandra made an average of $273.05 for each day she traded - meeting her $3,000 profit target in 11 days. But of these days, she made more than $273.05 only three times - gains of $691.12, $743.20 and $1,505.28. The rest of the time, she was treading water and ensuring losses didn't get out of control. That's good trading! 

  2. Alexandra was consistent in her position sizing, even as she gained money. Alexandra seemed comfortable trading two contracts at a time, whether she ultimately made one or nine trades in a day. Being consistent in size is one tool that helps traders recover from losses. For example, if you build up account and pyramid that into larger size, it takes fewer losing trades to make a larger impact in your trading. 

  3. Don't feel the need to push small gains to ever-growing gains. Nine of the 11 trading days in her Funded Trader Preparation, Alexandra ended the day at her daily P&L high. Some of these were her three largest gaining days, but more often than not, they were days where she gained fractions of that - sometimes as low as $52.64, $117.92 and $195.28. 
Awesome job Alexandra!

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Here's a snapshot of Alexandra's Funded Trader Preparation dashboard with an overview of her statistics. 

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Topics: TopstepTrader Funded Traders