Is anyone here actually profitable traders over the long term?

[xlisasimpsonx]

I’ve tried trading on and off for years. There is so much (useless?) info on the internet. Most of the info goes over the basics like what a futures contract is, but there is really no in-depth analysis, strategy, or long-term goals in regards to actually trading professionally and making tons of cash. To equate this to chess, almost everything you read online or in books goes over the equivalent of learning what each piece is called and how they move, but there is no discussion on openings, midgame, lategame, etc. Could you imagine having hundreds of books and thousands of websites on chess that do nothing but tell you what each piece is and how to move, and then tells you to “develop your own strategy”. What good/use would that be?

No one seems to show you how to trade live, there aren’t any really good strategies because everyone tells you the old cliché “do what works for you”, there is no talk of commissions and taxes eating away at a large portion of profits, and no one talks about how time intensive this really is.

I feel like the entire industry is a scam and the only ones who truly make money are the institutional investors at the banks/hedge funds, as well as the exchanges, brokers, and data providers. This is the house, essentially, which collects all the money and lets everyone come and play at their table. People see how much “can” be made trading on a computer at home, want part of the action, and go broke paying for things like coaching sessions, programs, books, etc. because they will never have even 1/100th of the knowledge/experience prop traders have but think they do nonetheless.

I was wondering if anyone here can just tone down the hype for a bit and give it to me straight. Do you make money doing this for a living, do you live well (multiple 6 figures), and how did you come to do that? Is it going to be found in some new indicator or (more realistically) deep, in-depth study of financial markets, geopolitical landscapes, and years of experience? I feel like to be any good at this you can’t memorize chart patterns and set a 3:1 R/R ratio but have to actually spend hours each day staying up to date with what is going on in the world. What good is your mathematical model or your head-and-shoulders pattern to short WTI Crude Oil (CL) if Russia Invades Ukraine, is met with sanctions, and causes oil prices to spike? This whole thing doesn’t seem like a hobby but a lifestyle: one that doesn’t provide any benefit unless you figure it out completely because it is a zero-sum game.

I’m currently looking down at the posts below mine and they talk about “psychology”. I feel like psychology would take care of itself if you knew what you were doing. The fear of having no idea what is going to happen to your money would scare anybody, and trying to push that down and ignore it seems stupid in my opinion. I feel like what 99% of us are missing is the actual damn strategy of how to make money.

Is anyone here (again, please leave your ego at the door and your hopes/dreams/wishes as well) ACTUALLY profitable and living a good life doing this?

[Mod-MattZ]

Hello @xlisasimpsonx and welcome to the community. Thank you for taking the time to write your experience and reflect on your experience.

I have been doing this long enough to give anyone practical advice and send a novice trader in the right direction. Alternatively, you may decide that trading is not for you. It is, after all, not for everyone. Below is my opinion and perspective. I hope my insight will help you.

Trading is one of the most challenging tasks one can engage in, and the success rate is low. This is because trading requires multiple disciplines encompassing psychology, habits, and analytical skills.

If you asked me whether I would give my money to a technician, algo trader, mathematician, or a programmer, I would say neither if I had the option to put my money with a marine or special ops person who learned the basics of trading. Why? Because core army people don’t have the luxury in a battle situation to panic or hope and engage in tactics that would lead them to a loss. Discipline is the core of their survival. I feel like you need above-average discipline skills to be successful at trading and not fall on our defaults of fear and greed in the many shapes that it manifests itself.

Typically, novice traders fall prey to either no strategy or no plan. The lack of strategy and planning leads to a lack of discipline, overleveraging, and trading errors where greed and fear take over.

I will ignore and not address statements like “making tons of cash” and “wealthy life” because if you got into this game because of these reasons only, you would be highly disappointed. And as such, no wonder you feel this level of frustration. I find that those who became successful at trading came at it from the angle of solving a problem. Their approach is focused on the process of execution and implementation of methodologies.

You seem overly upset that everyone teaches you the game rules, not the strategy. But, first, successful people cannot fully convey their decision-making process. Some of their actions could be based on many years of experience, and their actions are often tied to their intuition. Again, this is after many years of being in a certain field and practical experience.

Second, when they do explain, they attempt to explain their discipline, their strategy, and how they implement it through order execution. Third, realistically, pros can not describe how to attack every market situation because of the dynamics of market chnages, which is a challenge. They often have to adjust their strategy based on what they see and encounter. Yet, their discipline and adherence to risk management always stay the same.

Even the best traders in the world go through drawdowns, lackluster periods, and negative returns. There is some myth that traders would get consistent cash flow and make their own budget. They don’t always control that.

Many public records of funds, commodity trading advisors, and other investment vehicles list their returns month by month. If you ever looked at such records, you’ll see that it is not easy on them either. And remember, you are only as good as your last trade; even professionals can and do fail.

I agree with you that many of those who teach do not know how to trade. They were, however, smart enough to put information that impresses beginners. I would not look for instructors who promise to show you how to make money but a foundation to become one. This is, by the way, my approach to studying anything. First, I see their background and what makes them good at what they do. Then, I look over the content and decide whether it would serve me in the future as a foundation for what I am about to do.

I feel your frustration. You think the whole system is a setup to take away from you because you did not make money. But, you can not blame people or institutions for one’s lack of success. Brokers, FCMs, data providers, and exchanges provide infrastructure and should be viewed as such. Every business needs infrastructure, whether a retail shop or a service provider. However, you could shop around and choose the lowest provider for your business.

Here is my advice:

Futures trading involves a substantial risk of loss.

Start from scratch. Build your skills, and develop a strong discipline. Above all, remember that you do not have to trade if the trading period does not fit your risk tolerance(geopolitical events, economic surprises, etc.)

Start with Micro, implement a method, and stick to that method. If it does not work, see what is not working and adjust. If it is working, continue trading it until it does not work. Then, review why it did not work and repeat the cycle. Review reasonable periods, not micro (no pun intended), analyze each day, and trade.

Use Optimus resources we out to help customers:

Podcast

Blog

I wish there were an easy path to any business success. Still, the reality is that in any field, you have to develop skills to compete with very competent people.

I want to mention one last thing about those who are successful in trading. Again, this is my experience, but as I said, I have been doing this long enough to spot personality traits. The successful traders are graceful and modest and do not lead a lavish “Instagram” lifestyle. Some may have some luxuries, but many live below their means for the most part. This also makes sense. Their success results from risk management; when you are oriented around that concept, you do not allow yourself to go wild. I am not talking here about fund managers who manage billions, but rather those who trade their accounts for a living, not OPM (Other people’s money).

I hope this helps you on your new trading path.

Best,
Matt Z
Optimus Futures

There is a substantial risk of loss in futures trading. Past performance is not indicative of future results.

[xlisasimpsonx]

Matt,

That was one of the most thoughtful responses I have ever received. Thank you.

When I initially posted this I did not know that I was posting to a brokerage platform. I had written this post and copy-pasted it to several websites. I googled “trading forums” and posted this text to many places hoping to get a response from other traders. Fortunately I posted here.

I am currently not a client and did not lose money while trading through you. I just wanted to make that clear. This is not frustration over losing money through your platform and I am not holding you or anyone from your company responsible in any way. This was not meant as an attack and I did not mean to sound rude.

I have tried to trade over the years and realized very quickly that I did not know anything and that until I did I was going to lose money. I am down probably $1k over several years, which isn’t that much when depositing $20k-$30k at a time, but was worth the learning experience of knowing that I did not know how to trade properly.

My problem lies in the fact that I spend countless hours trying to devise strategies that do not work. That is why I posted here (and other places), trying to see if strategies actually exist to make money. I am very good at protecting the downside when trades do not go my way, but the problem is that I never know how to actually make money, rather than just protecting against loss.

Thank you for taking the time to write this. I am quite frustrated, but perhaps it is not the frustration that stems from losing a lot of money over the years (which seems to be the case with a lot of people); just the frustration of not being able to make returns after extensive back-testing, research, and trials. It seems like wasted effort.

The fact that you responded as a Mod on your brokerage forums and not any of my peers kind of proves my point. Many of the people in my position really don’t know what they’re doing. It’s just endless time spent on strategies that don’t work over the long term. However, I wanted to thank you for taking the time and being professional enough to write this to steer me straight. I would also like to say that when I am ready to trade again, you will have my business. I’ll choose Optimus Futures. Your customer service is above and beyond what I have seen elsewhere.

Thanks again, and take care.

[Mod-MattZ]

Here is another topic from a newbie. Maybe you can share with him the difficulties you encountered as a beginner and what you would advise as far as the possible mistakes you have done: Help for a new Futures Trading guy

Thanks,
Matt Z
Optimus Futures

[curio7x21]

Thanks for your detailed reply and for sharing your experience.

Really powerful comment: “Typically, novice traders fall prey to two things: either no strategy or no plan. The lack of strategy and planning leads to a lack of discipline, overleveraging, and trading errors where greed and fear take over.”

Edit: You return to the same idea at the end of your post – “Some may have some luxuries, but many live below their means for the most part. This also makes sense. Their success results from risk management, and when you are oriented around that concept, you do not allow yourself to go wild.”

Thanks so much.

[Mod-MattZ]

@curio7x21 Welcome to the Optimus Futures Comunity. Our goal at Optimus Futures is to help traders develop a different mindset that emphasizes discipline and risk management. Let’s leave the "YOLO"s attitudes on Reddit and focus on creating a space where traders can learn, practice discipline, and leverage their skills to discuss the challenges of trading futures.

Best,
Matt Z
Optimus Futures

[curio7x21]

Well said and thank you for the welcome. I really appreciated your comment that if you had to give money to a non-professional to trade it would be a marine/special ops person because they’re familiar with the idea of “feel the fear and do it anyway.” (Or do nothing/different strategy.) Powerful image. You want to use your training and honed intuition to filter a raw/novel situation.