Trading Edges, and journals, and skills....are all an illusion, delusion. Everyone feels they are secretly refining some magic concoction that will grant them invincibility and profits that no one else has possibly discovered. It's like the quest for true love, romance, soulmates....it doesn't exists. The best you can hope for is the random, rare, occasional bursts of euphoria, before it quickly dissipates into a sea of confusion, boredom, anger and reality. But the wise trader realizes this delicate, fragile, dance, and adjusts and trades accordingly,
He had 3 losing years in row 2010,2011,2012 where he lost around $225K in total. Before that period he did well. And even after that period it does seem like he still had an edge, just not as good as before.
His systems were optimised for the pre-2010 world, things were much simpler then. You need to constantly re-evaluate and drop a lot of strategies or make harsh modifications to neuter some of your favourite ones. But we all have attachment and don't like to throw away things we've invested so much time and effort into.
He became very INCONSISTENT in the last 3-4 years. Even in a profitable year, if you picked a different 12 months, like let's say June to June the results were all over the place... Pretty much random.
I'm not sure how precisely he measured slippage, there were so many strategies and he was working full time as well. Not sure how one can keep all that afloat.
Thanks for enquiring. Yes, things have looked better in 2022 - only I dug a really huge hole after the account went below $100K - its taking time to get above. Will give an update at the end of the month.
Long Period Update 07/05/2021 - 09/31/2022 ---------- Well, this is not a quarter, or even a year. However, having gone down deep below the poverty line and coming back above, now is the time to make an update. As stated then the losses continued after the update for the period ended 7/5/2021, losing 71K from then till 11/17/2021 when the account bottomed at about 38K. As you could imagine that was a period of deep desperation to make the money back. The effect was further losses that brought my account balance to below 38K, just a tad above what was needed to maintain my pattern day-trading ability. I just couldn't conceive of being deprived of ability to trade (no shorts, no margin, no options, 3 day to clear). The last time I was in that position was early 2005. I might be forced to pack up and close. And yes, I thought of doing just that nevertheless - and I had basically written off the remaining balance on that account in my mind. A period of reflection followed, and further automation of any profitable idea I had. The intent was to find how profitable I would be if I looked at the long term, and not get concerned about daily P/L. Is it 20% a year, 50%? In my mind I knew I had the ability to do that. So yes, over time I got detached from the daily performance and settled that a recovery is going to take years. The important thing was to establish there was still the edge and keep plugging along. Still a continuous battle to get that detachment. Below is summary of the performance over this period, broken down between the first part (the implosion), and the second part (the recovery). Of course performance has been boosted by the return of volatility. Performance should be higher when that happens, but I believe I have enough diversification to be profitable as well when volatility is low - what hurt performance before was not strategy but lack of disciplined execution. Now I think I am looking at the bigger picture. Let a trade or day's P/L be just that - one day out of hundreds or thousands of trades/days to come. Code: Implosion (07/05/2021 - 11/17/2021) Opening Balance: 109,100 Net loss for period (71,322) ------------------------------------------------ Net Balance: 37,778 Recovery Phase (11/17/21 - 09/30/2022) Opening Balance: 37,778 Net gain for period 60,494 ------------------------------------------------ Net Balance: 98,272 Year-To-Date (1/1/2022 - 9/30/2022) Opening Balance: 55,959 Net gain for period 42,313 (Up 75%) ------------------------------------------------ Net Balance: 98,272 The chart of account balance over the period is given in the diagram attached. It is clear from the charts there were a couple of days that accounted for the big dive down. The first was a swoop down of 35K on 2021-07-16 after breaking below the psychological level of $100K, followed - after some flatlining during a couple of months where I was trying to accept what happened - by another swoop down of 18K on 2021-09-03. Both cases trying to double down out of difficult trades.
The psychology of that kind of swing must hurt. Then to get back above where you started. I feel the pain just looking at your chart. Thanks for the update.