How good is my mates pips p/m??

[fancyfish]

Ok

Bit of a newbie and am learning before i dive in and risk my hard earned cash. Have a friend who consistently gets 400-700 pips per month on FX/UK Stocks using trade windows of 3-7 hours. Focuses on a few good quality trades per day and hence has great success rate (70% plus).

That sounds pretty good to me but i have seen quotes of 2,000 plus pips per month....he is offering to help me a little......does such a record sound good to you guys?

Cheers



P

 

[timsk]

Nah, avoid him like the plague. Anyone doing less than ten times that every day is a rank amateur.

 

[fancyfish]

ha - thats what he said!

 

[Masquerade]

More pips is better - find someone who can offer you 10k pips/month guaranteed.

Alternatively seek your friend's free advice and make a paltry 400-700 pips/month. I know which i'd do...

 

[fancyfish]

More pips is better - find someone who can offer you 10k pips/month guaranteed.

Alternatively seek your friend's free advice and make a paltry 400-700 pips/month. I know which i'd do...

Well i dont know any other trader........i am sensing much sarcasm which i expected .

Back on the question - is 400+ pips per month any good?

 

[Masquerade]

Well i dont know any other trader........i am sensing much sarcasm which i expected .

Back on the question - is 400+ pips per month any good?

There was initially, but on reflection I agree. More pips IS better and if you can find someone offering 10k pips/month guaranteed i'd bite their hand off.

400+ pips depends on a few things. Mainly what leverage is per pip and you'll only know that by knowing what style of trading they do. Also the market is a bit helpful too. A scapler's pip in general will be larger than a position trader's pip.

 

[fancyfish]

There was initially, but on reflection I agree. More pips IS better and if you can find someone offering 10k pips/month guaranteed i'd bite their hand off.

400+ pips depends on a few things. Mainly what leverage is per pip and you'll only know that by knowing what style of trading they do. Also the market is a bit helpful too. A scapler's pip in general will be larger than a position trader's pip.

Yes from what i hear 10k is unlikely!

Not a scalper - more a trend day trader (correct terminology?). Good money management so no more than 1% committed on any one position.

 

[Masquerade]

10k is unlikely unless you're trading a lot of FX pairs and catching a lot of moves.

I guess your terminology is correct. I don't know if 1% is good money management, that's what common belief is. Depends on account size too. If you have 1k and you risk 1% it's not a lot, risk 1% of a million and it's a fair sum. But let's say he's using a stop loss of 50 pips and 1%. So that's 1%/50 pips = 0.02% risk/pip. Now if he makes 400-700 pips/month we're talking a return of 8-14%/month (not accounting for compounding) which a lot of people would be happy with. But I have made an assumption of stop loss size here.

 

[fancyfish]

10k is unlikely unless you're trading a lot of FX pairs and catching a lot of moves.

I guess your terminology is correct. I don't know if 1% is good money management, that's what common belief is. Depends on account size too. If you have 1k and you risk 1% it's not a lot, risk 1% of a million and it's a fair sum. But let's say he's using a stop loss of 50 pips and 1%. So that's 1%/50 pips = 0.02% risk/pip. Now if he makes 400-700 pips/month we're talking a return of 8-14%/month (not accounting for compounding) which a lot of people would be happy with. But I have made an assumption of stop loss size here.

I have never back calculated pips to return before (simply hadnt looked at it like that) so very insightful - thanks. His accuracy is rather good which impressed me - its just you see all the educational tips sites that have 2k+ and think "can i learn more from them".

 

[Masquerade]

You're better off sitting down in front of a screen with someone who knows what they're doing and is willing to help than paying a site with a bunch of people all trying to learn and get the attention of a person. You'll just end up taking signals and have no idea why you're doing it.

The reason I mention that risk is because a lot of people get into the school of thought of risking 1-2%/trade, then they'll scalp with 10 pip stops and wonder why they lose a lot when they do it by the book. But in reality their risk/pip is huge. The person who risks 10%/trade and 500 pip stop loss will be heavily criticised for their risk. But in reality their risk is much lower than that of the person risking 1% on a 10 pip stop.

 

[fancyfish]

You're better off sitting down in front of a screen with someone who knows what they're doing and is willing to help than paying a site with a bunch of people all trying to learn and get the attention of a person. You'll just end up taking signals and have no idea why you're doing it.

The reason I mention that risk is because a lot of people get into the school of thought of risking 1-2%/trade, then they'll scalp with 10 pip stops and wonder why they lose a lot when they do it by the book. But in reality their risk/pip is huge. The person who risks 10%/trade and 500 pip stop loss will be heavily criticised for their risk. But in reality their risk is much lower than that of the person risking 1% on a 10 pip stop.

I see...i must admit scalping is a bit alien to me. From a banking background so understand market making etc but not sure how this is replicated in a PA trading environment.

 

[Rhody Trader]

Ok

Bit of a newbie and am learning before i dive in and risk my hard earned cash. Have a friend who consistently gets 400-700 pips per month on FX/UK Stocks using trade windows of 3-7 hours. Focuses on a few good quality trades per day and hence has great success rate (70% plus).

That sounds pretty good to me but i have seen quotes of 2,000 plus pips per month....he is offering to help me a little......does such a record sound good to you guys?

First of all, there are no "pips" in stock trading. They are points and are not quite the same as forex pips - at least when trying to discuss/compare returns.

Second, talking in pip terms totally leaves out the discussion of risk and actual return. I could say a make 100 pips per month and be making 20% gains or I could say I make 2000 pips per month and make 1% gains. Also, the way people count pips can make things very misleading (intentionally or otherwise).

Ask you're friend what his monthly % returns are and what his drawdowns look like (again in %) and you'll have a much better basis for deciding if it's worth learning from him.

 

[fancyfish]

First of all, there are no "pips" in stock trading. They are points and are not quite the same as forex pips - at least when trying to discuss/compare returns.

Second, talking in pip terms totally leaves out the discussion of risk and actual return. I could say a make 100 pips per month and be making 20% gains or I could say I make 2000 pips per month and make 1% gains. Also, the way people count pips can make things very misleading (intentionally or otherwise).

Ask you're friend what his monthly % returns are and what his drawdowns look like (again in %) and you'll have a much better basis for deciding if it's worth learning from him.

Yes have toally grasped the pips means nothing without quantification of risk now - helpful...if not essential .

I always understood 1pip = 1/100th point or are the two used differently?

Shares typically measure in pence or cents and currencies in 1/100th of a cent or pence (eg) hence the difference??

 

[Masquerade]

1 pip/tick is the smallest increment something can move. But if you were trading STIRs you'd be talking in ticks. If you were doing stocks it'd be points/pence. In FX pips/points whatever. It's a bit un-important to get bogged down on it.

A pip in FX is going to vary. On usd/jpy 1 pip = 0.01 move. In gbp/usd it's going to be 0.0001 move. In stocks 1 pip = 1 penny, but we call them points or just pence.

 

[BSD]

1 pip/tick is the smallest increment something can move. But if you were trading STIRs you'd be talking in ticks. If you were doing stocks it'd be points/pence. In FX pips/points whatever. It's a bit un-important to get bogged down on it.

A pip in FX is going to vary. On usd/jpy 1 pip = 0.01 move. In gbp/usd it's going to be 0.0001 move. In stocks 1 pip = 1 penny, but we call them points or just pence.

I totally agree !

No idea whatsoever why all instruments need different names for price moves anyway, seems a bit childish, as in, yo, I'm a big Bund trader, we don't earn points, we do ticks, bro .

Silly.