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-- Down nearly 25% on the year... documenting every trade until I'm back to even. (http://www.elitetrader.com/vb/showthread.php?threadid=220897)
Down nearly 25% on the year... documenting every trade until I'm back to even.
Hey all,
I've been trading stocks for a few years now and in February I started trading options. I don't believe in paper trading and believe the best way to learn about anything in the market is through using real money. As a result, I've learned a lot recently, but I'm down nearly 25% on the year.
The purpose of this journal is to document my journey back to an even P&L on the year. I plan to do this by limiting options trades, which I have been using exclusively for the past 3 months, and going back to what has worked for me (trading/swing trading stocks & ETF's).
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Holding overnight, stopped out when 60min candle closes above trendline.
Also, commissions are $1.00 per 100 shares.
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I'm still short heading into Monday.
If spy gaps lower tomorrow morning by anything more than .5%, I will cover half of my position.
I have been working on letting my winners run however, so lets see where this week takes us.
I covered all 38 shares at 38.61.
Last night I said I would cover half of the shares if spy gapped down over .5%. I did not do this because spy opened below its daily trendline-support. I then figured spy would trade lower to test the 100sma on the daily chart. I left for my 9 o'clock class and set a buy order for all 38 @ 121.61 (just above the 100sma). I decided to cover all shares because the market, if it reached my 131.61 target, would be way over extended.
pictured below are the daily charts showing this trade; the chart on the left is from last thursday when I put the trade on and the chart on the right is today.
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Forgot to add:
Starting capital = $2670
Spy short trade = +$113
Current capital = $2780
Goal.... $3500
+4.1% account gain on trade and since start of journal.
(Figures may be a bit off due to commissions and an 18$ options contract I am still holding)
Nice long there at 131.61, you got in right on the touch of that trend channel line from May 5.
Thanks Sidw.
Short spy at @ 132.7 Stop is ~ 134.5 area.
Don't know why it says I got filled before the chart reached 132.7...
Looking to hold this for a while, preferably down to the 124/125 area.
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Still short, I knew when I put this trade on that I would probably take some heat. Market is reverting to the mean right now... not worried. If we close at highs today, I will look to see the market gap higher on Friday, in which case I will add to my position as I expect there will be heavy selling into the weekend, and early next week.
Just bought 50 DRV @ 11.95
I'm still short 30 SPY.
what did you dislike the most about trading options? Obviously the much more rapid loss of capital is probably near the top.
Honestly, I can't afford them. With my account size being as small as it is, the volatility of an option makes it difficult to manage risk properly. After all, one $2.80 option would equate to ~10% of my capital. The "rapid loss" of this $2.80 option can/did quickly deteriorate my account value.
Although they don’t suit my needs now, I would like to use options in the future and believe they can be a great tool for anyone with more capital.
Closed out DRV. SPY stop is todays high.
30 SPY stopped out @ $135.03
I sold the 50 DRV today at $11.44
Journal starting capital = $2670
Current capital = $2680
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When I started this journal I had a bearish view on the economy. I still do. Among other things, I am worried about QE3 ending, the national debt, and the fragile condition of the US economy. Going forward, I will look to make other short attempts, as I believe there will be a correction. This does not mean that I will not buy in short time frames however.
Took a losing trade today… Terribly stupid of me, but it was a revenge trade spawned from my emotions relating to covering my shorts before yesterdays sell off.
Bought 30 TNA @ 81.00
Sold 30 TNA @ 80.1104
My basis is $129.598 for a total of 80 SPY short. Screen shot is of the first 50 shares I sold short.
Stop is todays high.
Will probably sell everything by end of day
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Covered near end of day at @ $129.4598
Total net P&L: $8.02
Starting Capital = $2670
Current Capital = $2656
how much have you spent in commisions already? I recommend betting big and hope to accumulate a good bankroll. Looks like you're churning
Quote from rosy2:
how much have you spent in commisions already? I recommend betting big and hope to accumulate a good bankroll. Looks like you're churning
Total Net P&L $22.22
Short 40 SPY @ 127.80
Short 40 SPY @ 128.07
Cover 80 SPY @ 127.62
1 minute SPY chart is posted.
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Starting Capital = $2670
Current Capital = $2678
Trading at this frequency and with one-minute data is not a viable strategy - especially given your slippage. Your broker likes it, though. Shitcan the one minute bars and the micro-architecture if you want to have a chance.
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With such a small account, you need to be willing to take big swings and you need leverage to return anything significant. This is why I trade at NADEX (they don't pay me for this but they should). The smallest spreads are worth $10 per point, thats $40 for 4 points and they use spreads which means limited risk/reward. Commish and vig is high but it is possible to profit.
$1 per side commission (with $7 max). Let's say you take 3 contracts = $30 per point leverage x 4 point = $120. But what is really nice -- you can have far more leverage then with futures with LESS risk and you don't need to use stops (most of the time). I've had 1k in my account. At peak I return $1400 with only 1k in the account. I've currently return around $400 or 40% on the capital.
Today at max size I had on $40 per point. I took it off quickly but my max risk was probably only $400-$500. This is much better then the futures. The futures are the most efficient market to trade for those who have the capital. With about $500-$600 at risk, I can control 60k of S&P and get in and out for $7 per turn. But the real point is not that but that I can size the risk to my account. I can trade a system that would require 7k with the ES E-mini with only 3k by using 3 contracts.
The reason I mention it so much though is because it is one of the only viable options (I've found) for those with less then 5k to 15k risk capital for the futures. You can practice scaling in/out at reasonable risk. I look for a long time for anyway for me to trade without 15k. I couldn't find any other way that I could get the leverage, not be subject PDT rule, and at a price point.
Of course, you have to approach this like a professional. Watch the premiums closely, watch your risk, know your tolerance, be discipline... etc
You have to watch the total dollar risk, time risk, and premium risk. You have to correctly make assessments on total dollar risk to likely realized risk.
You need to be willing to risk 5% to 20% of your account on a single trade. I like to use 12 losers in a row as an estimate, you can risk about $300 per trade. I'm just saying if you want to return anything significant.. Not encouraging this path because most lose.
Quote from Lucias:
This is why I trade at NADEX (they don't pay me for this but they should). The smallest spreads are worth $10 per point, thats $40 for 4 points and they use spreads which means limited risk/reward. Commish and vig is high but it is possible to profit.
Thank you for the comments. Sorry for the delayed reply, I've been working a lot.
Bone, I agree. I'm working on getting away from shorter time-frames but it is going to take some time for me.
I read a bit about NADEX... looks interesting but I'm gonna have to pass as I want to keep things simple.
Short 20 SPY @ 132.76
Prepared to short 20 more on Monday.
Daily chart on left, 5 min on right.
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US debt problems are going to kill the market this summer.
Limit order to short SPY, 20 @ 134
Quote from upandcomer:
Limit order to short SPY, 20 @ 134
still short
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