I got a message today asking me to add a single-contract version of my system because its position sizes are too large. I’m told this way subscribers can control their own position sizes.
I thought they could anyway. Now I wonder: what control do subscribers have over their position sizes? If I trade 9 contracts of NQ does that mean a subscriber has to trade that many as well? I keep my system at 2x leverage, so that 9 is bound to change without notice. Perhaps that’s the problem? Is a single-contract system in fact easier to trade?
It seems silly to have to offer a totally new system to manage this, but then I’ve never auto-traded any systems here. Is it silly, or is it necessary?
- Jamie
I just set-up futures autotrading on Monday and C2 allows a subscriber to select either a dollar amount or % scale. The dollar amount is simply converted to a % scale. The % scale will determine the number of contracts to trade relative to the number in the signal.
So, if I set my scale at 50% and you trade 9 contracts, I will trade either 4 or 5 (not sure how it rounds).
I can also set a min and max number of contracts to trade. With your system, I could trade 1 contract by setting the min to zero and the max to 1, with 100% scale.
Could also simply trade any fixed number of contracts by setting the min/max to whatever I want.
I don’t really see any reason to offer a system that trades one contract for the purposes of auto trading set-up.
The bigger question might be, how important is your variable position sizing to your system? Since trading a fixed number of contracts would effect the performance a subscriber would experience.
Jim
This is probably one of the easiest systems to trade manually if you, as the system does, use the NQ as the trading instrument.
I’m used to looking for CAGR as a measure of performance. But I’m not sure that’s the norm here. Some systems seem to be set up for a roughly constant position size, others (like mine) for a roughly constant leverage/margin. I guess I’m committed to the constant leverage path at this point - I started with 7 contracts to be 2x leverage, and am currently at 9. I don’t want to change strategies midstream.
- Jamie
Jamie,
In the autotrader on C2 one can specify the maximum number of contracts to trade for a given system. For example, I can specify that I want to trade at 25% of your recommendation but with the maximum number of futures being limited to 2. For example, in the case you increased the number of futures traded from 8 to 9, the number traded in my portfolio would remain as 2.
Eugene
You can also scale your system down to the new contract amount - all the while keeping your current record (C2 will recalculates the stats).gA
