Monthly Archives: May 2016

Dukascopy contest stats(updated), Future trading contest, making $250B a year

I know I’m good in statistics because I took a statistics course at UCLA last year and scored top in the class out of 100 people. I have recently gone through the Dukascopy Trader Contest statistics. For one thing, the distribution of returns on the Trader Contest is similar to live accounts due to the fact that in both 70%+ of people lose on a monthly basis. I have compared my statistics to the top 200 Trader Contest performers. In PnL I have $3.902M over the contest history, which is 4.65 standard deviations above the mean. The probability of being 4.65 standard deviations above the mean is 1 in 100,000. On 1:10 leverage my returns are 38 fold, 12.1 standard deviations above the average. The probability of being 12.1 standard deviations above the mean is less than 1 in 10^33. So it is the equivalent of taking the SAT 8-9┬átimes in a row and scoring perfect every time or winning the lottery jackpot 4 times in a row. Below is the distribution of returns compounded at 10:1 of the top 200┬átraders, you can see me with the highest value and how much of an outlier that is compared to the rest.

Dukascopy leaders

 

Here is the PnL for top 30 traders:

Trader contest leaders

 

Despite my contest performance I am widely regarded as a fool on forex forums. It amazes me, no one has come close to my performance out of 5,000+ traders on the Dukascopy contest yet I am still called a fool. Why hasn’t anyone come anywhere close to my performance? Calling me a fool is like calling someone who takes the SAT 8-9 times,scoring perfect everytime,┬ástupid. Calling me a fool is like calling someone who wins the lottery jackpot 4 times in a row unlucky.

Anyways, I plan on creating the best trading contest in the World within 30 years. I will buy FXCM or Gain Capital and host a trading contest on our platform. The goal of the trading contest is to find traders that can produce a yearly return of 20-30%. I believe this is very possible by having a year long contest at 10:1 leverage with high commissions to weed out scalpers and low executable size strategies. The contest prize would be $1M and $10M to manage for the top .1% of performers. The top .1% of performers should be able to deliver a return of 20-30%+ per year. I should note also that because of the large prizes involved there will be fear of loss to the traders in the contest.

Next I wanted to talk about how one can make $250B a year by trading 2% of FX spot volume. Currently FX liquidity is at $5T a day. Trading 2% of that makes $100B in volume a day. You would have to split on the 30 most major traded pairs. The turnover would be $25T a year. All you would have to do is make 1% per trade on average. I think this is very possible. I’m not going to say what methods I would use but I would be trading off daily charts. I would be continuously executing on 30 pairs throughout all of London session. To give you an idea, if you buy/sell 1M EURUSD every second for all of London session you would trade about 30B in a day. To make the $250B a year, you would need about $1T in capital and use leverage of 1:10(possibly as high as 1:20).