Tuesday, December 2, 2008

Tuesday Notes - Slightly More Aggressive

4:00pm 'Twas an interesting day and market pace with any trend trade entries (pick your timeframe) on anything but the first pullbacks not paying. Intraday second & third pullback attempts -- long or short -- were simply brutal. As a result, being nimble and quick on 1-2 sequences and sitting out the rest of the day seemed to work well.

At this end, I picked up the aggression a bit (1,441 x 2) and finally got the chip gain back over five figures with an acceptable +$15K gain on the day. Yet most of the gains came from two sequences: the opening where we had a textbook pullback into yesterday's strong short trend, and the early afternoon breakdown which presented a similar -- albeit short-lived -- short bias.

It definitely wasn't a banner "pace" day at all in my view, but there were enough scrap opportunities to do OK provided we didn't lock ourselves into an all-day trend bias and limited damage on losing sequences as much as possible.

To that end, I'm generally satisfied with today's management, although there remains plenty of room for improvement including sizing and hold time of the two profitable sequences.


Chuck said...

Hi Don,

I'm a newbie to your blog - really great stuff - thanks for sharing.

I'm a little confused when you refer to the # of contracts you are trading and your net gain. For example, today you said 1,441 x 2 contracts and a $15K gain, does that mean you traded 1,441 contracts for 2 points and you netted $15K? I tried looking back at your earlier posts for an explanation, but am still unsure.


Don Miller said...

Hi Chuck -

No problem with the question.

Yes, "1441 x 2" reflects the fact that I traded a total of 1,441 contract buys and 1,441 contract sells over the course of the day. Today, the 1,441 was comprised of 450 FESX (EuroStoxx) and 991 ES (S&P E-Mini).

All P&L references refer to the net day's gain or loss after all costs, rounded up or down to the nearest thousand and converted to $USD if necessary.

So today for example, the details of the +$15K were: +$17,088 gross profit ES, -$945 gross loss FESX, -$1,571 commission costs for a net of +$14,572.

Hope that helps ... I imagine other newer readers may have been wondering the same thing.


Ziad said...

Hey Don,

As a member of the CME, do you own a seat or are you leasing one? And also, if it's the latter, which type of lease is it? (There are four different ones for individuals).

It seems your overall commissions including exchange fees for ES are probably less than $1 per round turn (as I imagine FESX commissions cost you more).

I trade a couple hundred round turns a day currently and looking to lease a seat to save on commissions. My broker is looking into the IOM division lease for me which costs about $2,400 a month and saves about $1.40 per round turn in exchange fees, but a more expensive lease if it's possible for me to get it may still be even more economical.

Just thought I'd hear your thoughts.



Don Miller said...

Hi Ziad -

I've been leasing an IOM seat for several years which I typically renew in 6 mos increments. I'm paying $2,200/mo right now, but know prices have been going up.

As you've probably discovered, it doesn't take much trading to breakeven on the fee.

Yes, I'm under a buck, keeping in mind the total commission includes both CME and FCM (broker) fees, with the latter often varying based on broker, trading volumes, negotiation, etc.

Hope that helps.