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Ricochet Trading - Frequently Asked Questions (FAQs) |
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HOW DOES RICOCHET TRADING'S
SYSTEM WORK AND HOW DO YOU TRADE THE MARKETS....
We have designed a specific page
which is accessable from our home page or (by clicking Here) which details our overall trading
strategy. Ricochet Trading System looks to capture the intraday
trend by following the directional bias that has been recommended by
our underlying indicators.
Depending on the type of trading
session we are expecting we also may decide that "scalping" is the
best way to trade the markets that day. Scalping is a term that refers to entering a trade with
the goal of just taking 2-4 points out of a small directional move
and not holding for a larger gain from an intraday trend
move. |
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WHAT IS YOUR OVERALL
RISK/REWARD RATIO OR PROFITABLE TRADES TO LOSS TRADES
RATIO?
As long term experienced traders we do
not give much weight in our system to the specific loss/gain ratio
on each trade. We consider the P/L at the end of the session and the
total points accumulated at the end of the month to be more
important as this is the real profit loss or gain.
Although with all due respect for the
concept, the idea of highly detailed so-called Profit Factors or
Risk/Reward ratios are often used by extremely mechanical systems
that end up losing money over time. Often we see that systems
reporting a high "profit factor" or solid gain v. loss trading ratio
end up just breaking even or having huge drawdowns over time.
Sometimes these overly complicated figures, which
are compiled by computers, are used in backtesting and
become slick ways of drawing investors into purchasing the
vendors systems without real time, actual monthly point
accumulation figures from trading in real time.
Here at Ricochet trading we go into the
markets each day with the goal of doing what it takes to make money
or, if wrong, cut our losses and play strong defense. Sometimes the
markets will change dramatically and we have to re-configure our
system in the middle of a huge market aberration. Such was the case
in September of 2006 where true intraday market swing/flow was
drained out of the market with pumped up artificial
buying.
Overall, we make an average of 35-60
trades a month (less is best in our view) and normally over 50% of
those trades are winnners. However, some of the trades are very
small losses of under 1.00 and some are gains of around 1.00. Other
times, we catch a good intraday trend run and will catch a 6-10
point move. It just depends on what the market is offering
that day. Because of this real time "adaptive to market conditions
trading" we feel that conventional loss/gain ratio's etc., which are
used generally in an entirely mechanical system, are moot points in
analyzing Ricochet Systems trading results.
The TRUE win/loss-Profit/Gain ratio is
how many S&P500 Emini points are accumulated, minus the amount
of round turns (at the current broker rate of $6.50 all in), and
that amount stacked up with the actual cost of entering a trade IE:
the margin per contract. (brokers now offer intraday trading
margin rates as low as $300 per contract but here at Ricochet we use
a conservative $1000 per contract rate to calculate our Profit/Loss
ratio).
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WHAT IS THE BEST WAY FOR ME TO
DECIDE IF I WANT TO OPEN AN ACCOUNT WITH $2500 AND START USING THE
RICOCHET TRADING SYSTEM IN MY PORFOLIO?
We recommend that you get our Free
Daily Newsletter (by clicking Here) , which comes in
your email everyday and is updated 2-3 times a day. Watch how
we trade the markets, the early AM report bias that we give, and how
the trades stacked up with that at the end of the session in our
Wrap Up report.
Make a note of the market conditions
that day and how the week ended up in overall
results. Then, take a look at our monthly results on our
website. Once you decide that Ricochet is doing an efficient job of
making steady gains and holding drawdowns to a minimum then
contact the broker listed on our websote to open an account,
register with us for a subscription to our trading signals, and give
it a shot.
Although we are not licensed brokers
and cannot make personal recommendations for your financial
circumstances, we have made opening an account with a relatively
small amount of money easy and low cost for testing our service.
Over time if you appreciate the way we
trade and the results then you can add more to your account and
trade a larger amount of contracts. All of this is 100% controlled
and adjusted on your own personal Strategy Runner trading platform
or with the assistance of your broker. Ricochet has absolutely no
control or any involvement with your account other than our
subscription fees and offering you trading signals.
We hope you will join us as long time
subscribers and look forward to answering any questions you may
have.
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Please note: Ricochet Trading is a trading signals vendor
and NOT a registered futures trading firm and we do not directly
manage or trade your account. Please contact your broker or call JR
Stegmueller at Spike Trading, Inc. at (866) 761-7197 for more information
on how to setup a futures trading account to trade the Ricochet Trading
Strategy. Government Required Disclaimer - Commodity Futures Trading
Commission Futures and
Options trading has large potential rewards, but also large potential
risk. You must be aware of the risks and be willing to accept them in
order to invest in the futures and options markets. Don't trade with money
you can't afford to lose. This is neither a solicitation nor an offer to
Buy/Sell futures or options. No representation is being made that any
account will or is likely to achieve profits or losses similar to those
discussed on this web site. The past performance of any trading system or
methodology is not necessarily indicative of future results.
CFTC
RULE 4.41 - HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN
LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT
REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT BEEN EXECUTED,
THE RESULTS MAY HAVE UNDER-OR-OVER COMPENSATED FOR THE IMPACT, IF ANY, OF
CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING
PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED
WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY
ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFIT OR LOSSES SIMILAR TO THOSE
SHOWN.
All trades, patterns, charts, systems, etc., discussed on
this Ricochet Trading Web Site are for illustrative purposes only and not
to be construed as specific advisory recommendations.
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