I hate to even ask here but I really screwed up and need some input. I have been trading spreads for a while and whenever I get hit hard I just double down. What typically happens is sooner or later the spread tightening and my position breaks even or I walk away with a profit. I have been doing this for a long time and it works for me. This time I am about to get a margin call if things donât go in my favor. If I get hit I am out of business and I have no clue how I am going to pay for my mortgage, car lease and all of my memberships. I know I post here a lot as a wise ass but I need some input. Right now I am slamming a lot of booze trying not to face tomorrow (Hopefully I will be so hung over I sleep through what ever happens). What the hell do I do? My options are basicly: I get a margin call if the spread widens and I am done. The market opens and I man up to take a huge hit to my account but I can still pay my bills for a few months with that money that is left over. It gives me time to figure out what is next. I can sit back and either get a margin call or the spread tightens and I might be able to keep trading.
Doubling down is always long-term blow out strategy even if you can get lucky sometimes. Whenever you have a bad trade, you should get out and re-evaluate.
Lol. That's cold, man. I don't know this poster but it's probably better he keeps it quiet. Don't wanna see this guy turn into bill ackman. Anyway, my simple answer to you is easy and you already know it: get out of the position asap. I'm going to assume you don't have a really big position relative to your market. The nasty thing about getting out of a big spread is seeing both legs crush you as you start taking it off. That always feels psychologically more crushing than just getting out of an illiquid directional bet. But, you gotta get out. Live to fight another day and all that good stuff.
" The market opens and I man up to take a huge hit to my account but I can still pay my bills for a few months with that money that is left over. It gives me time to figure out what is next... " looks like you know what is best option : man up , take the loss..., spend a LOT of time in a park near trees and rivers... and restart trading! And welcome to honesty section - aka psychology. Feel free to update on how you felt before manning up, if you manned up or not, ... just keep the thoughts, feelings, emotions here. we understand.
1) It's "different" this time. :eek: 2) Liquidate the position to the point where you can sleep. 3) Drink Hennessy instead of Boone's Farm.
My suggestion would be to liquidate the position COMPLETELY. I don't think it's good advice to take some off in this case. It's actually an interesting point to debate, but since we're in psychology forum maybe it's a good place. I would argue that he's crossed a certain psychological line where the position has threatened his whole business - he doesn't want death by a thousand cuts. He's probably lost all objectivity at this point, and can't trade the rest of the position rationally. Better to just get out completely, wipe the slate clean, and restart trading after a break where he's feeling more confident. The line is different for all traders based on emotional/psychological makeup. It seems obvious from his tone and financial circumstances that he's crossed his with regards to this position.
Get flat The emotional capital youâre expending is irreplaceable..., youâre completely helpless / powerless Exit and regain control ==================== Btw; Imo if you stick this out and by some outside chance it goes in your favor â in the long run thatâll screw you up more (experience talking) Yeah â there is always a chance⦠but then thereâs always a chance â till it is absolutely too damn late Itâs a shit sandwich RN
I think so too. Doubling down on a losing trade is usually the wrong thing to do. Best thing to do is to get flat, then reassess the situation from a more objective viewpoint.