To be honest, I don't think it was a good start. In my opinion one of the most dangerous things for a new option trader is early success. It's amazing how many traders get off to a great start for a few months, maybe a year even, and then they come crashing down to earth and find themselves way below their starting point after a few big beats. Say this to yourself, over and over again every day for the rest of your trading life: 1% a month, 12% a year.... 1% a month, 12% a year.... If you start with realistic expectations it's amazing how consistently profitable you can be in the long run, well in excess of your goal of 12% a year. DO NOT start thinking 38% per trade. If you think that way, it's amazing how fast you'll blow up your trading account.
Very well said, and reflects my own experience 15 years ago as a novice trader. I was lucky to survive my first (and last) margin calls when the market turned against my so-called fool proof options strategies. Early success can be a dangerous drug. It's very easy for a new trader to think he's discovered the holy grail of riches, lever up, then get killed.
There is a strong urge and tendency to increase your position size after repeated successes. Use a trade size/money management system that protects you from a disruption in your successes. I have had a number of trades that worked very well for months on end, to then reverse about the time I began increasing the trade size. The money management was only thing that preserved a portion of my winnings the 2nd time. (Thought I had the holy grail the first time, and lost all gains to that point and a tad more) Also, I find it humbling in hind-sight to re-evaluate the winning trades and determine why they were winners and how my "technique" took advantage of it. <-- key word here is "humbling"
Very true. The longer people trade the more they start to realize an important truism: Sometimes smart trades still lose money, and sometimes even dumb trades make money. Process oriented traders have far more success in the long-run than results oriented traders. Analyzing past trades both winning and losing ones is an excellent way to keep the ego in check. Just because it made money doesn't mean it was smart, and vice versa.