How do you get over a big losing day?

Discussion in 'Psychology' started by jinxu, Aug 12, 2010.

  1. Josette

    Josette

    Think about it as an opportunity to buy stocks at half price! Like any sale! :)

    When the stock market finally goes up back up then you can sell at a profit.

    There will always be losing days in the stock market.
     
    #31     Aug 16, 2010
  2. Biog

    Biog


    simple....just nail a BIG WINNING DAY :D :D
     
    #32     Aug 17, 2010
  3. schizo

    schizo

    You don't. You simply pick up whatever you can and move on.

    Be that as it may, you're asking a wrong question. The correct question should be "What can you possibly learn from a big losing day?"
     
    #33     Aug 17, 2010
  4. I just had a huge losing day today. I was headed for my first very positive month since starting in January, and in 3 trades today, I got completely wiped out of all my profits for the entire month. I'm back to square one after 17 days. It's extremely, extremely frustrating.

    The thing is that I was following my system, I didn't deviate. It's just that my system generated trades that were very large, and I played too many contracts and was far too aggressive. It wiped out 10% of my account with 3 full losses of a bit over 3% each.

    What's even worse is that I was thinking of not taking the trades because it was too large, then I said, oh fuck it. Every other time I passed a trade it ended up winning so I figured I should stay consistent and just trade it.

    I guess the only takeaway is that I need better risk management. When the trade looks bad to me, I should just stick with the bare minimum.
     
    #34     Aug 18, 2010
  5. BCE

    BCE

    Sorry you had such a bad day. We can all relate to that and it sure feels crappy. But as I recover from the bad feelings, and they are (no one is here to lose money which feels bad), I try to look upon the day or "bad" trades as a learning opportunity. Just to analyze what happened and reflect on how I can avoid having it happen again. This is how we learn. And as hard as it seems to see it that way, in some ways it can be a blessing in disguise, as it will make us better traders with fewer losses and bigger returns. Again, this is how we learn.

    In your case maybe your "system" needs tweaking. It obviously didn't work today. I'm not a big fan of systems due to these possible drawdowns. But I know a lot of people here use them and some successfully. I like your idea about if you're not feeling strongly about a trade maybe trade smaller lots. If it goes your way you still make money and if it doesn't you don't lose so much. It's when you take big positions you can really get hammered. And this is especially true when using a system. And your thoughts on risk management are also very good and very important. It's when we don't limit our risks that we're setting ourselves up to eventually get hammered. Good luck with your trading and don't let it bring you down too much Bro. You'll get it back and more. Onward and upward.
     
    #35     Aug 18, 2010
  6. jnbadger

    jnbadger

    +1. Figure out what the hell you did wrong and don't do it again. Unfortunately, sometimes it takes years to figure it out.
     
    #36     Aug 18, 2010
  7. Thanks for the kind words. Yes, it definitely needs some tweaking. I'm of the mind, like what Mark Douglas says, that losses are all part of the system. But it's really frustrating to see the entire month of profits just disappear. I do think that limiting the number of contracts in certain situations is something I will incorporate.

    The good news is that I have been getting better over the course of this year. The first few months were disasterous and I had a huge drawdown, and my trading had been really horrible. I was getting to the point where I was cutting my profits early because I was too afraid to take a loss, and this hurt me a lot.

    The turning point for me was, however, that I think about 2 months ago, I went through the theoretical results of my system for the entire year-to-date and compared them to my actual results, and realized that I was the one messing up the system by deviating from it. Had I stuck with it, I would have been up 26% for the year, but instead I'm down about 45%. So I came to the decision that I was going to trade my system no matter what, until I lost every single penny. That has actually helped me tremendously and what was leading to my first profitable month of the year, because I was able to stick with the system. I've learned to trade smaller, and just wait for the profits to accumulate.

    Whenever I take a big loss or make stupid trades, I wear this t-shirt that I haven't washed in about 6 months. It stinks to high hell and I can't stand wearing it, so it really is punishment for me... it's the first time I've had to wear it in the past few months, so hopefully this is the last time for a while! :D
     
    #37     Aug 18, 2010
  8. BCE

    BCE

    That's funny :) , but no need to punish yourself. The "bad" trades are punishment enough. Don't beat yourself up. We need to learn to be kind towards ourselves and cut ourselves a break. We work hard mostly and do our best. We're only human. Maybe treat yourself to a nice dinner or whatever. We can be our own best friends and do for ourselves what we wish someone else would step in and do. Life is difficult at times no doubt. Let's all be kinder toward and more accepting of ourselves and our failings. It's only trading after all and our lives are so much more than that. You'll be okay. We can tell already in your approach to this you're learning.
     
    #38     Aug 18, 2010
  9. I take the opportunity to catch up on my crying and screaming.
     
    #39     Aug 18, 2010
  10. In P&R.
     
    #40     Aug 18, 2010