My target is 2 ticks, and my stop loss is 4 ticks. I make 3 successful trades a day trading 2 contracts, and then I am done for the day. I suppose most people would say my target should be a least 4 ticks. But this method is working for me, and I am able to support myself financially. I am curious, nonetheless.
The only rule is "don't lose money in the long term". If it works it works. I presume you have some positive expectancy for each trade-
Is it 2 ticks for each trade or 2 ticks a day? How many good trades as % of total trades? What do you trade because tick value depends of what you trade. If you trade ES with 2 ticks a trade you make about 40.000 $ a year. But you should have NO losing trades. With 4 ticks stop you need at least 66% profitable trades to be break even. So above 66% profitable trades you can make money.
I forgot to include that I trade the ES. Yes, it is 2 ticks per trade, and I don't pay any mind to the percentages you mentioned. I win every trade with only rare exception.
I only trade the first two hours that the market is open. Usually the trade is good for at least 4 ticks. But I feel more comfortable only taking 2 ticks, and then waiting for the next trade.
If you make 6 ticks a day with 2 contracts you make about 40K every year. But if you reinvest your profit, trade max up to 100 contracts and would trade with a margin of 2000$ per contract you will make about 1.2 mio $ a year. You will beat 99,99% of all the traders in the ES. And with almost no drawdown everybody will bring you millions to invest.
If you're only taking 2 ticks then you're basically trading in the noise and your entries are essentially random. If you set the SL at 4 ticks and the TP at 2 ticks you'll appear to have a win rate of about 67% just from a coin toss entry. Does your entry have an edge better than a coin toss?
He said that he almost never has a losing trade, so he should have an edge. If not he would lose more frequently than "almost never". He wrote:I win every trade with only rare exception.
But he didn't say for how long. Most people would consider themselves having made it after a couple of days not losing.