This is Who You are Competing Against Trading

Posted by TopstepTrader on March 22, 2018

From listening to John Bougearel, you quickly discover a couple things. First, he is incredibly in tune with the market and knows his trading style backwards and forwards — and clearly knows his edge.

Second, it's a reminder of the intense competition that is futures trading. In global electronic markets, this is the trader that you are competing against. 

In this interview, John Bougearel talks about his trading style, how he found his passion in technical analysis and his overall approach to the market. Be sure to subscribe to Limit Up on iTunes, Google tPlay or Soundcloud to get the fresh episodes each week delivered to your inbox. 

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Topics: Trading Basics, Limit Up!, Forex, Futures, John Bougearel

What Separates Trading Success from Failure — A Look Back at Our Funded Traders

Posted by TopstepTrader on March 19, 2018

In 2017, TopstepTrader funded almost 400 futures traders with our capital, providing them risk-free opportunities to profit.

As we fund even more traders this year (we're on pace to fund 3x as many — with 241 traders funded in January and February!), we wanted to share concrete examples of the difference between profitable and unprofitable traders. 

To do so, we went back to the trading data. We tracked average daily profits, average daily losses, largest profit, and largest losses, comparing the traders who were active as of January 1, 2018 with those accounts that were closed in 2017. We grouped traders into two groups: those that were currently active in their Funded Account™ (Group A) and those that broke a rule trading in their Funded Account (Group B).

The results speak for themselves. 

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Topics: TopstepTrader Funded Traders, Trading Basics, Forex, Futures

Become a Better Trader in Just Over an Hour: Your Weekend Curriculum

Posted by TopstepTrader on March 17, 2018

 The weekend is here; markets are closed. But that doesn't mean that you can't work on your trading. 

This week, we put together three resources for you to think about and digest this weekend. Highlights: the story of a funded trader that cut his loss limit down — and how it helped him make $2,000 last week; what a poker champion has to say about decision making; and how one trader built a $900 million fortune. 

Enjoy. 

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Topics: Trading Basics, Futures, Trading Setups, Weekend Curriculum

The Secret to a $2k Week

Posted by TopstepTrader on March 16, 2018

TopstepTrader's founder and chief visionary officer, Michael Patak, joins Senior Performance Coach John Hoagland for a special episode of Trader Behavior. This week, Michael and John focus on a scenario that funded trader Bob R. faced last week  and how proper from management led to a $2,000 trading week.

In the week, Bob had a great day trading on Monday before hitting his loss limit on Tuesday, Wednesday and Thursday. Yet because he had set his personal loss limit at $350, he knew exactly what he could possibly lose each day and built that into his trading plan. He came back on Friday knowing that he couldn't lose money on the week (because he was up more than $350) and added $1,000 to his account. In total, he profited $1,950 on the week!

All this is to drive home a point: the way to increase profits is to actually tighten your losses. Bob has just 47% winning days, yet because his winning days are 2.5x his average losing days, he doesn't need to be right all the time to be profitable. Here's how tighter losses actually equal bigger profits. 

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Topics: Trader Behavior, Performance Coaching, Trading Basics, Forex, Futures

Two Amazing Trading Lessons from “the Cal Ripken of Hedge Funds”

Posted by TopstepTrader on March 13, 2018

Comparing a trader to a baseball legend may seem odd at first. You might be more likely to look for an athlete known for flash, like Michael Jordan, or aggressiveness, like Mike Tyson. However, the aide who described hedge fund manager Monroe Trout in The New York Times as “the Cal Ripken of Hedge Funds” couldn’t have been more right.

Much like The Iron Man set the record for consecutive games played, Trout never missed a day in his 15+ years at the helm of Trout Trading. But showing up is a just small part of Trout’s story. These stats tell the rest:

  • In one five-year period, Trout was profitable in 87% of months.
  • His average annual return during that period was 67%, while his largest drawdown was just 8%.
  • In all months, Trout Trading never had a losing year and posted an average annual return of 21.5%.

Trout’s return/risk measurements are extraordinary, but his methods for achieving them can be followed by any trader. Let’s take a look at a few tactics you may be able to emulate.

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Topics: Trading Basics, Trading Lessons, Market Wizards, Forex, Futures, Monroe Trout

This is How You Trade Around Events

Posted by TopstepTrader on March 12, 2018

In the latest episode of The Trade, Performance Coach Dan Hodgman talks about one of our funded trader's trades last Wednesday, March 7. The trade occurred right after the ADP Employment Report, a report that showed 235,000 jobs were created in February — more than the 200,000 jobs expected. 

One might expect a better-than-expected jobs report to cause a sell off in the Ultra Bond (UBM8) since the market might anticipate that the Federal Reserve will raise interest rates more this year. However, bond prices failed to sell off.  That could have been the spark that funded trader Craig S needed to initiate a long.

Some parts of this trade were good, while others may be more questionable. Here's Coach Dan's take on how to trade an event after it happens.

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Topics: TopstepTrader Funded Traders, Performance Coaching, Trading Basics, Futures, Trading Setups, The Trade, Fixed Income

Become a Better Trader by Monday in 1 Hour: Your Weekend Curriculum

Posted by TopstepTrader on March 10, 2018

 The weekend is here; markets are closed. But that doesn't mean that you can't work on your trading. 

This is our first in a new weekly recap that's meant to help traders improve over the weekend in 1 hour or less. It's a collection of a few tips, takes and articles — some of which will be produced by TopstepTrader and some not. 

In this week's hour, we highlight the 3 Laws of Short-Term Scalping, the 7 Cardinal Sins Traders Make, and an Interview with Melissa M, a funded trader. 

Enjoy. 

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Topics: Trading Basics, Futures, Trading Setups, Weekend Curriculum

Turning $90K in Trading Losses into an Opportunity

Posted by TopstepTrader on March 09, 2018

Michael Patak is the founder and chief visionary officer of TopstepTrader. He started trading and promptly blew up three $30,000 trading accounts (for a total of $90,000). 

Not deterred, Michael realized that he was trying to hit home runs — allowing the promise of trading riches to lure him into huge losses. (Of course, trading with a gambler's mentality never works out.) 

In this episode of Limit Up, Michael talks through those early losses, the challenge from his father that turned his trading around and why the pain of those losses led him to found TopstepTrader. Be sure to subscribe to Limit Up on iTunes, Google tPlay or Soundcloud to get the fresh episodes each week delivered to your inbox. 

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Topics: Trading Basics, Limit Up!, Forex, Futures, Michael Patak

These are the 3 Rules of Short-Term Scalping

Posted by TopstepTrader on March 07, 2018

In the latest episode of our new trading segment, The Trade, Performance Coach Dan Hodgman takes a look at a successful Nasdaq futures (NQ) trade by Russell B. from Minneapolis, Minnesota. Russell's style is a little different than the other two trades that we've covered. He tends to be short-term minded and keeps very close stops — more of a scalping type trader than a position trader.

Given that his style is a little different, Coach Hodgman talks about what someone who is more of a scalper should think as they put positions on. Russell's risk in the trade was 2.5 Nasdaq points — $100 on a 2-lot. His target was more than 10 points higher, and he was able to eek out a $440 gain in less than 5 minutes. 

Check out the rules we learn in this week's segment.

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Topics: TopstepTrader Funded Traders, Performance Coaching, Trading Basics, Futures, Trading Setups, Equities, The Trade

5 Can’t Miss Posts from February

Posted by TopstepTrader on March 06, 2018

Volatility was the name of the game last month. Big swings may cause a few sleepless nights and anxious days, but they can also be profitable if you’re prepared. A robust risk management plan is the key to navigating the market’s sharp turns. Let’s take a look at some of February’s blog post that can help you get ready for the next wild ride.

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Topics: Trading Basics, Trading Lessons, Forex, Futures

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