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  • #38,801
  • Jul 7, 2024 9:50pm Jul 7, 2024 9:50pm
Quoting Trader191
{quote} averaging down ist all kind of bring average buying price lower then you bought with your old orders for buy orders (or higher for sell orders), so even many grid systems and of course martingale systems (simple averaging down with special factor)..... are averaging down systems. all of this averaging down is of course big beginner level and no money win machine until you dont find stupid investors who are not educated about this small chance to win longterm by same time high risk only on their side. only because some traders (in this case...
My question is why some prop firms do not allow traders to martingale if it is advantageous to them.

You are answering a question which i have not asked.
Intraday only.
  • #38,802
  • Jul 7, 2024 9:53pm Jul 7, 2024 9:53pm
Quoting Trader191
{quote} averaging down ist all kind of bring average buying price lower then you bought with your old orders for buy orders (or higher for sell orders), so even many grid systems and of course martingale systems (simple averaging down with special factor)..... are averaging down systems. all of this averaging down is of course big beginner level and no money win machine until you dont find stupid investors who are not educated about this small chance to win longterm by same time high risk only on their side. only because some traders (in this case...
You are in UAE, I know a person ( in UAE )who lost 600 to 700 k usd by martingaling in a stupidway without risk management.
He took long in EU around 1.08... price went down... he added... price went down... he added.

He pumped more money into account... ....price went down below parity. He lost his account all.

He is now mad, lost his livelyhood.
Intraday only.
  • #38,803
  • Edited 3:27am Jul 8, 2024 3:14am | Edited 3:27am
Quoting navk
{quote} My question is why some prop firms do not allow traders to martingale if it is advantageous to them. You are answering a question which i have not asked.
i answered the question 100%, martingale is 100% disadvantage for props.

i wrote that martingale is there to cheat investors. props are investors (of course only fake investors in most cases because of demo accounts, but they pay performance fee like they are real investors!). so prop get cheated by this strategy. the question would be, why there exist prop who allow it.... this is in general only possible when they cheat in an other way big to compensate this.

of course you can trade it in your private account, then you cheat yourself and the B-book broker like you very much as a high chance loser trader over longterm (same like you described in your last post ... that is just a standard result of averaging down).
  • #38,804
  • Jul 8, 2024 3:21am Jul 8, 2024 3:21am
hello, Why don't prop firms utilize reputable ECN brokers such as IC Markets, Pepperstone, or Tickmill?
  • #38,805
  • Jul 8, 2024 3:43am Jul 8, 2024 3:43am
Quoting sabu12345
hello, Why don't prop firms utilize reputable ECN brokers such as IC Markets, Pepperstone, or Tickmill?
because this broker you mention are not so "good" and b-book a lot for themself (and by b-book you earn more than with prop). so when you do prop same time you earn less as b-book broker (would be trade off when you do both and you need to see how you change conditions to manage this trade off), because you lose deposits when your clients switch from your normal account model to prop (when you have same account settings).
  • #38,806
  • Jul 8, 2024 4:32am Jul 8, 2024 4:32am
I didn't realize that IC Markets, Pepperstone, or Tickmill operate as B-book brokers; I thought they were A-book, true ECN brokers based on the websites I visited. So, which brokers are actually A-book and reliable?
  • #38,807
  • Jul 8, 2024 5:24am Jul 8, 2024 5:24am
I'll just do a nasty copy paste on this:
https://www.fool.com/terms/d/dollar-cost-averaging/

"Like with most investment strategies, dollar-cost averaging is not for everyone, and there are times it works better than others. But it can be a powerful tool for removing some of the emotional barriers to investing. Here's a look at how dollar-cost averaging works and the best ways to use the strategy."

The so called worst nightmare of literally 95% of current prop firms to protect the traders, since thats what the prop firms do. Wanting the best for the traders gambling habit. Oh so dangerous especially with a risk management and SL.
https://m.foolcdn.com/media/dubs/ima....width-880.png
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  • #38,808
  • Jul 8, 2024 7:08am Jul 8, 2024 7:08am
everyone has been so focused on US they forgot the EU.
https://www.financemagnates.com/fore...g-video-games/

The US regulator is going to trip and fall on its face but the EU are starting the drum banging all but stating that these businesses should have been licensed to begin with. Its a bit more twisty than necessary but you can assume a few member states of the EU will ban props and others will require licenses because "your investment is at risk".
  • #38,809
  • Jul 8, 2024 7:09am Jul 8, 2024 7:09am
Quoting sabu12345
hello, Why don't prop firms utilize reputable ECN brokers such as IC Markets, Pepperstone, or Tickmill?
if you think pepperstone is an ECN broker I have a very large bridge to sell you.
  • #38,810
  • Jul 8, 2024 7:21am Jul 8, 2024 7:21am
Quoting Takisd
everyone has been so focused on US they forgot the EU. https://www.financemagnates.com/fore...g-video-games/ The US regulator is going to trip and fall on its face but the EU are starting the drum banging all but stating that these businesses should have been licensed to begin with. Its a bit more twisty than necessary but you can assume a few member states of the EU will ban props and others will require licenses because "your investment is at risk".
When do you expect any concrete actions from the regulators and which ones ?
  • #38,811
  • Jul 8, 2024 7:27am Jul 8, 2024 7:27am
Quoting Stoneyrocks
{quote} When do you expect any concrete actions from the regulators and which ones ?
Belgium will ban but they ban everything, i have no inside line at the moment about anything official from europe but i know 3 different people now approached regulator/are in process with a regulator now about getting licensed. The regulators do not know which license to use whether its a fund management license or a brokerage one the way the business is shaped will determine which license goes where.
  • #38,812
  • Jul 8, 2024 7:31am Jul 8, 2024 7:31am
Quoting Trader191
{quote} i answered the question 100%, martingale is 100% disadvantage for props. i wrote that martingale is there to cheat investors. props are investors (of course only fake investors in most cases because of demo accounts, but they pay performance fee like they are real investors!). so prop get cheated by this strategy. the question would be, why there exist prop who allow it.... this is in general only possible when they cheat in an other way big to compensate this. of course you can trade it in your private account, then you cheat yourself and...
Prop firm analogy to disallow DCA or martingale is like Lion killing deer and giving reasons like they want to protect global warming. Is it?
The reason why prop firms are not allowing martingale and Dollar cost averaging because it is successful 90% of the time and people withdraw money easily with only risk of fees. They can blow up but they will loose only challenge fees.
There is no investors and no liquidity pool, no fair value gap or name any spelling bee jargon.
Almost all prop firms which gives you account to earn money with only one step or two step challenges are CASINOS.
The reason they dont allow DCA or martingale (like APEX and other firms) because it is successful 90% of time and trader can withdraw money and when they blow up they dont loose that much compared to what they can withdraw.
  • #38,813
  • Jul 8, 2024 7:51am Jul 8, 2024 7:51am
Quoting sampat
{quote} Prop firm analogy to disallow DCA or martingale is like Lion killing deer and giving reasons like they want to protect global warming. Is it? The reason why prop firms are not allowing martingale and Dollar cost averaging because it is successful 90% of the time and people withdraw money easily with only risk of fees. They can blow up but they will loose only challenge fees. There is no investors and no liquidity pool, no fair value gap or name any spelling bee jargon. Almost all prop firms which gives you account to earn money with...
you just repeat what i did say. martingale ist idiotic strategy to cheat the investor (because you dont trade in your account, so you are not the investor and cheat not yourself). if you trade in prop account, prop company is the investor (this part was wrong from you, because they pay you because they are the investor - with real money or fake does not matter in this case) and has the risk for this. they pay the performance fee, so trader just cheat the prop with martingale and is thats why forbidden.

its very basic simple math. if you would have the rule, that only after 1 or 2 years you can get a performance fee, martingale would be allowed with a very good chance.
  • #38,814
  • Jul 8, 2024 7:52am Jul 8, 2024 7:52am
Quoting sampat
{quote} Prop firm analogy to disallow DCA or martingale is like Lion killing deer and giving reasons like they want to protect global warming. Is it? The reason why prop firms are not allowing martingale and Dollar cost averaging because it is successful 90% of the time and people withdraw money easily with only risk of fees. They can blow up but they will loose only challenge fees. There is no investors and no liquidity pool, no fair value gap or name any spelling bee jargon. Almost all prop firms which gives you account to earn money with...
Right
Prop firms (models we discuss here) have a 100% conflict of interest with traders....they win when we lose
Therefore, common sense then tells us, anything they want to ban has a higher chance of success for the trader( if done correctly).
I am sure they would care less of the DCA/martingale, whatever you wish to call it when a reckless gambler is using it.
However, when I precisely risk 1% over a series of 5 trades making up one position( all pre-meditated)....they do not want me.
Are we really to believe that if DCA wasn't leading to trader withdrawing profits, APEX would ban it?
  • #38,815
  • Jul 8, 2024 7:56am Jul 8, 2024 7:56am
Quoting Trader191
{quote} you just repeat what i did say. martingale ist idiotic strategy to cheat the investor (because you dont trade in your account, so you are not the investor and cheat not yourself). if you trade in prop account, prop company is the investor (this part was wrong from you, because they pay you because they are the investor - with real money or fake does not matter in this case) and has the risk for this. they pay the performance fee, so trader just cheat the prop with martingale and is thats why forbidden. its very basic simple math. if you...
There is no investor, they collect fees in hopes of not paying them back out. They should want the trader to use strategy that fails.
  • #38,816
  • Jul 8, 2024 8:04am Jul 8, 2024 8:04am
Quoting pipmaster77
{quote} There is no investor, they collect fees in hopes of not paying them back out. They should want the trader to use strategy that fails.
they pay you performance fee like you trade invested money. and using martingale is like you cheat your investors.

of course its same, whatever its fake invested money or real (of course only when they pay the performance fee ).

of course its crazy high performance fee (so its even like trading extrem invested money), thats why most prop trader are not used to real 15-25% performance fee you get for trading real money companies, but thats an other topic.
  • #38,817
  • Jul 8, 2024 8:15am Jul 8, 2024 8:15am
Quoting Trader191
{quote} they pay you performance fee like you trade invested money. and using martingale is like you cheat your investors. of course its same, whatever its fake invested money or real (of course only when they pay the performance fee ). of course its crazy high performance fee (so its even like trading extrem invested money), thats why most prop trader are not used to real 15-25% performance fee you get for trading real money companies, but thats an other topic.
Is this cheating or the reason why some props want to ban martingale?

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  • #38,818
  • Jul 8, 2024 8:57am Jul 8, 2024 8:57am
Quoting TraderTero
{quote} Is this cheating or the reason why some props want to ban martingale? {image}
if you trade martingale bullshit in your own account is no cheating, because you have to live with the high loss when happens. so all fine, anyone is happy, you until you lose and your b-book broker all the time (maybe ecn brokers dont like it because they lose clients with this over time).

when you trade for an investor (copy trading ,prop, managed accounts, funds,,,, whatever) and use this beginner bullshit, then its like cheating because looks like you want rip off the investor because you know what will happen on end with highest chance, and you dont have to pay for this end.

of course people who use martingale for investors are most of time total beginners, fakers, cheaters, scammers....... not without a reason.... of course unexperienced traders exist who dont know what they do and do it and dont want harm other..... but this will end in same problem on end, even when they did not want to cheat and just dont know good enough math and trading. not without a reason 90% are martingale strategies in all the copy trading platforms or managed accounts you will find (and many are in first places , not because they are good, just because many 10.000 of this systems are traded all the time and some get by luck visible until bust , replaced by next and so on.... always same....).


by the way, the return in your picture is not enough , you would not even use this system in real!
because it has in 15 months same return then any average return of nasdaq ETF, but in same time of last 15 month nasdaq would have crazy more win (so much higher then average return). so when you cant beat big even a nasdaq ETF (and this with the risk of a martingale system) you should invest longterm and not trade, because you lose time and money as opportunity costs when you trade.
  • #38,819
  • Jul 8, 2024 9:00am Jul 8, 2024 9:00am
Day 1.. road to 150kx20

1. PA - 600 daily tp hit
2. Evals 1k a day hit
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Extreme gut feeling trader
  • #38,820
  • Jul 8, 2024 9:09am Jul 8, 2024 9:09am
100% PROFIT SHARE NOW WITH CityTradersImperium

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