emini trading

Our money management strategy is simple. Live to trade another day!!! One thing that is important to learn when trading is that you are trading for the long term. What happens today or even this week does not matter. You are trading to be profitable for the month and then the year. This is very important. No strategy will give you 100% profitable trades. That’s not possible. So, you need to make sure you are well prepared for the losing days and weeks that are possible. Let me show you an equity growth calculator that will show what your potential income will be trading with just 3% risk of your trade. First off, let’s start with a $10,000.00 account. A very common size account to start with. The following charts are actual trade results that our strategy produced in 2009.

This is your potential starting with $10,000, just trading the S+P e-minis and the Nasdaq e-minis alone.

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In just 2 months, you are up to $18,784.00!

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In just 5 months you are up to $39,260.00 in your account.

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In 9 months you are at $196,751.40 in your account.

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This is only risking 3% of your account on any 1 trade. DO NOT OVER LEVERAGE YOUR ACCOUNT!!!! You don’t need to risk more than 3% of your account to be a very wealthy trader. I know this is hard to believe, but this shows you that you need to trade for the long term. Have the patience to allow your account to grow over time with proper money management, and you will have success. Most people have a little success, and they then risk too much on their trades, only to find that their system is in a rough spot, and they blow their account. Don’t be one of those people!!!! We recommend no more than 3% risk. How you figure this is as follows:

$10,000.00 account X 3% = $300.00 This means, you are willing to risk $300.00 of your account on any 1 trade. $300.00 divided by the amount of ticks your stop is, 12,and then again divided by the amount the market pays per tick, in this case 12.50.

Example:

$10,000.00 x 3% = $300.00 The amount of risk. $300.00 divided by 12 ticks divided by $12.50 per tick = 2 contracts you can trade. To look at it another way, you are trading 2 contracts that pay $12.50 a tick, and your stop is at 12 ticks. So: 2 contracts x $12.50 = $25.00 per tick you are risking. $25.00 per tick x your stop of 12 ticks = $300.00. So, your total risk on that trade is $300.00. Your profit target on this trade is 24 ticks. 24 ticks x $25.00 a tick = $600.00 potential profits. So, you are trading at a 1 for 2 risk reward on this trade. I hope this makes sense to you. If you have questions, e-mail us or join us in the live trading room and ask all the questions you want.

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