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Book Wanted: Trading For A Living

  • #21
  • Apr 13, 2006 8:02am Apr 13, 2006 8:02am
Thanks for the comments, guys. It was a rush presentation we put together at the request of some in the chat room who needed advice on improving their trading.....glad it was useful to you!
Capital Preservation is key to long term wealth accumulation
  • #22
  • Apr 13, 2006 3:25pm Apr 13, 2006 3:25pm
Quoting eastmaels
Hahaha.. Now let's test your observation skills.. Notice anything different now?
Okay, I've looked over this like a dozen times, and nothing!

What am I missing?!
Capital Preservation is key to long term wealth accumulation
  • #23
  • Apr 13, 2006 5:02pm Apr 13, 2006 5:02pm
Quoting MuddBuddha
Okay, I've looked over this like a dozen times, and nothing!

What am I missing?!
Sorry MB... Actually I returned my title to the original.. Actually I used the title same as yours but my mind was screaming "Are you crazy?!"
And returned it to "Trading Student." Sorry for wasting your time..
  • #24
  • Apr 14, 2006 12:04pm Apr 14, 2006 12:04pm
Muddbuddha,

I just went through this presentation and I have mostly worked with GBPUSD, (BTW my broker pays $10 per pip for either GBPusd or EURusd, but the spread is larger on GBPusd). However, because of your discussion on the changing political events, I am looking at other currencies as well. It is great advise, I had not considered that perspective... Thanks SMJ


Quoting MuddBuddha
We put on an online class full of trading physcology babble a coulple months back.....here's the replay link:

http://protradingnetwork.com/trading...gy_part_1.html
  • #25
  • Apr 14, 2006 1:47pm Apr 14, 2006 1:47pm
Great! I'm glad you got something out of it!

Heck, even if only one point of the presentation makes you think deeper about your trading, then it was worth the time vested by presenter and attendee.
Capital Preservation is key to long term wealth accumulation
  • #26
  • Apr 14, 2006 1:52pm Apr 14, 2006 1:52pm
OMG, Mudd, I set up a seperate folder on my drive titled MuddBuddha to pick up any scraps you may drop... LOL Scott



Quoting MuddBuddha
Great! I'm glad you got something out of it!

Heck, even if only one point of the presentation makes you think deeper about your trading, then it was worth the time vested by presenter and attendee.
  • #27
  • Apr 14, 2006 2:47pm Apr 14, 2006 2:47pm
The audio CD version of "Trading for a Living" arrived today! Yippie...it'll go into the bedside CD player tonight and be played in the pillow speaker under my pillow for a few nights, then i'll put it on during waking hours and get into it more.

Happy Easter weekend,
Thom
  • #28
  • Apr 14, 2006 3:01pm Apr 14, 2006 3:01pm
You always get the coolest stuff... SMJ



Quoting accrete
The audio CD version of "Trading for a Living" arrived today! Yippie...it'll go into the bedside CD player tonight and be played in the pillow speaker under my pillow for a few nights, then i'll put it on during waking hours and get into it more.

Happy Easter weekend,
Thom
  • #29
  • Apr 14, 2006 3:08pm Apr 14, 2006 3:08pm
Quoting accrete
The audio CD version of "Trading for a Living" arrived today! Yippie...it'll go into the bedside CD player tonight and be played in the pillow speaker under my pillow for a few nights, then i'll put it on during waking hours and get into it more.

Happy Easter weekend,
Thom
Thom,

My favorite part of the audio book is when he refers to "losers"....he says it so often and with such seriousness, that I often found it amusing - but yet those are the comments in the book I remember and refer to the most when talking to others.

Be interested in knowing exactly how many times he says it in the book!
Capital Preservation is key to long term wealth accumulation
  • #30
  • Apr 15, 2006 8:18am Apr 15, 2006 8:18am
Hi Mudd!

Thanks very much for the audio! I am enjoying it at the moment, and it is very helpful!

Mike
  • #31
  • Apr 16, 2006 5:25pm Apr 16, 2006 5:25pm
Nice audio Mudd,
real eye-opener.
But about that cable and euro stuff you were talking about.Correct me if I`m wrong,buy didn`t you tell in one part tha cable has like 25% less value per pip than euro.I didn`t believe that (was sceptic as you said),and checked at Oanda,and as far as I could understand,cable and euro have same pip values for equal amount if units.

Now,if I`m still wrong,please clarify.
  • #32
  • Apr 19, 2006 7:16am Apr 19, 2006 7:16am
For a 10,000 unit lot on Oanda, the EUR/USD pays $1.00 for each positive pip and -$1.002 for each negative.

For each 10,000 unit lot on Oanda for GBP/USD, you get $.78.

JPY is $1.....EUR/GBP is $1.78 per lot....USD/CHF is $.76 if I remember correctly.

Oanda seems to have it set up so that the higher the spread, the less it pays per pip.
If you check some of the exotics, you'll see they ay less than $.33 a pip with a 10-15 pip spread
Capital Preservation is key to long term wealth accumulation
  • #33
  • Apr 19, 2006 9:38am Apr 19, 2006 9:38am
Quoting MuddBuddha
For a 10,000 unit lot on Oanda, the EUR/USD pays $1.00 for each positive pip and -$1.002 for each negative.

For each 10,000 unit lot on Oanda for GBP/USD, you get $.78.

JPY is $1.....EUR/GBP is $1.78 per lot....USD/CHF is $.76 if I remember correctly.

Oanda seems to have it set up so that the higher the spread, the less it pays per pip.
If you check some of the exotics, you'll see they ay less than $.33 a pip with a 10-15 pip spread
I think you`r wrong here.I went again to oanda,and it seems that euro and cable have same pforit per pip parameters.
http://www.oanda.com/products/fxmath/profit.shtml

Take a look yourself,maybe I still don`t get it.
  • #34
  • Apr 19, 2006 1:59pm Apr 19, 2006 1:59pm
Regardless of what the site MAY say, these ARE what you get.

Each window is marked with a 10000 unit lot (mini) and the bottom # is the value per pip. I traded with them a long time.....I know them almost better than anyone.

USD/ZAR = 0.17

EUR/USD = 1.00

USD/CAD = 0.88
Attached Image
Capital Preservation is key to long term wealth accumulation
  • #35
  • Apr 19, 2006 2:44pm Apr 19, 2006 2:44pm
Quoting MuddBuddha
Regardless of what the site MAY say, these ARE what you get.

Each window is marked with a 10000 unit lot (mini) and the bottom # is the value per pip. I traded with them a long time.....I know them almost better than anyone.

USD/ZAR = 0.17

EUR/USD = 1.00

USD/CAD = 0.88
Mudd,

This makes PERFECT sense, as I think most people have always thought this...ANY USD based pair (With USD in the FIRST slot) will have a varying pip value as the price rises ands falls because the exchange rate is based on buying (or shorting) USD, and then selling (or covering) the second currency. The math involved is pretty simple:

The math is pretty simple:
COST = (LOTS * 100,000 USD)
PROFIT = ((COST * ending rate) - (COST * starting rate)) / ending rate

As you can see, as the rate goes up the PROFIT per pip will go down.

Do an example on 1 lot USD/JPY going from 118.00 to 118.50 and then compare that to the yen going from 118.00 to 119.00.

PROFIT(118.00 to 118.50) = ((100,000 * 118.50) - (100,000 * 118.00)) / 118.50 = 421.9409 USD

PROFIT(118.00 to 118.50) per pip = 421.9409 / 50 = 8.438819 USD

PROFIT(118.00 to 118.50) = ((100,000 * 119.00) - (100,000 * 118.00)) / 119.00 = 840.3361 USD

PROFIT(118.00 to 119.00) per pip = 840.3361 / 100 = 8.403361 USD


Now, if you contrast that with a NON-USD based pair, like the euro, the same math applies, but results will be in the BASE currency

COST = (LOTS * 100,000 BASE CURRENCY)
PROFIT = ((COST * ending rate) - (COST * starting rate)) / ending rate

Now, if the second pair is based on the USD, it is easy to calculate:

PROFIT in USD = PROFIT * ending rate

Now, for those of you algebra junkies, if you replace PROFIT with it's formula you end up with the following:

PROFIT in USD = ((COST * ending rate) - (COST * starting rate)) / ending rate * ending rate

and because the transitive property of multiplcation:

PROFIT in USD = ((COST * ending rate) - (COST * starting rate)) * (ending rate / ending rate) = ((COST * ending rate) - (COST * starting rate))

PROFIT in USD per pip = PROFIT in USD / ((ending rate - starting rate) / pip)

= ((COST * ending rate) - (COST * starting rate)) / ((ending rate - starting rate) / pip)

= (((COST * ending rate) - (COST * starting rate)) * pip) / (ending rate - starting rate)

= COST * (ending rate - starting rate) * pip / (ending rate - starting rate)

= COST * pip

So, if COST = 100,000 and pip = 0.0001 then PROFIT in USD per pip = 10 USD

Challenge me on this...
  • #36
  • Apr 19, 2006 2:53pm Apr 19, 2006 2:53pm
Uuuhhhhh......I don't think anyone would have the MARACAS to challenge that! Ole'!
Capital Preservation is key to long term wealth accumulation
  • #37
  • Apr 19, 2006 4:19pm Apr 19, 2006 4:19pm
I still have same values for euro and cable.Maybe it`s because it`s demo account,altough it doesn`t make sense.

(had to cut pictures because of post restrictions)
  • #38
  • Apr 19, 2006 7:10pm Apr 19, 2006 7:10pm
Quoting Alex
I still have same values for euro and cable.Maybe it`s because it`s demo account,altough it doesn`t make sense.

(had to cut pictures because of post restrictions)
Alex, your eyes don't decieve you...and your calculations ARE correct. Mudd was pointing out the different pip values for USD-based pairs (USD in the first part of the pair).

He is quite correct, as is your screen.
  • #39
  • Apr 20, 2006 3:44am Apr 20, 2006 3:44am
Quoting MuddBuddha
For a 10,000 unit lot on Oanda, the EUR/USD pays $1.00 for each positive pip and -$1.002 for each negative.

For each 10,000 unit lot on Oanda for GBP/USD, you get $.78.

JPY is $1.....EUR/GBP is $1.78 per lot....USD/CHF is $.76 if I remember correctly.

Oanda seems to have it set up so that the higher the spread, the less it pays per pip.
If you check some of the exotics, you'll see they ay less than $.33 a pip with a 10-15 pip spread
No,he definately mentioned cable.
  • #40
  • Apr 20, 2006 4:04am Apr 20, 2006 4:04am
The EUR/GBP is the ONLY pair that I am aware of that pays more than the $1.00 per pip on a 10K mini lot. As well, it is also one of the most range bound pairs on the market.
Capital Preservation is key to long term wealth accumulation
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