Thanks. I believe airing these things out is helping me. I don't have much to be chagrined about as I am about flat investment/trading wise over the last three years. If I had just bought-and-held i would be down a decent amount. That said, I don't think i can overcome my final challenges until or unless i go full-time. I need to be able to focus day-in and day-out in a consistent manner. We will see...this week will be an important week for me.
"I have eliminated most of my problems, but one of the largest remaining issues is closing winners way too early after/when the trade has started out by going against me." I do this too. I try to protect my capital at all costs but it seems to keep me from getting more outliers. My hit rate atm is about 80% but my returns are average (better than the index -- altho most think its useless as a benchmark). I'm trying to put hedges in place at certain support/resistance lines to avoid panicking when the worm turns.
I have the same problem. My nanny quit on me last week so I was having to take care of the kid Thursday morning. I have no problem making money if I am uninterrupted. If I am interruped it causes stress on me and causes bad trading decisions. What I am getting at is don't place intraday trades on when you are going to be distracted. If you are doing swing trades, don't place them just because you are infront of the computer. Pick a important support/resistance and s/l 1.00 above or below it. Stop out don't reverse. The market is always there, you don't always have to be a part of it. Lat thing is forget how much you lost. If you keep that number in mind you are going to try and make it back in one trade!!
Speciaul you couldn't be more correct. Everything you said is dead on and are my exact issues. I am still a little positive for the year....i need to close out monday and just regroup. I knew i needed to do that anyway, when i was up...knew i was playing with fire. Now i'll just have to do it from a less advantageous position I need to focus on only swing trading, even though i feel i can make good money intraday on ES and CL. But without the ability to focus uninterrupted i'm just going to have multiple blow ups. I am trying to make a good chunk of it back with some high risk trades....stupid. Going to end up digging my hole deeper if i'm not careful.
Here is a peak into how depressing my last two weeks have been: My stats for this week: +2% change in portfolio value -35% MDD during the week 5% of portfolio value = Total commission cost for the week (the +2% in portfolio change is after commissions) Yes, i ended the week up marginally, but i nearly killed myself in the process. The short story here is I am done actively trading for the time being. While I escaped unharmed this week, I got murdered last week in a way i wouldn't have thought possible. I'll write up a full accounting of the grim situation later this weekend.
So here is the conclusion, with all the gory details. Basically, I lost about $100k in 3 days...it all started with a 20% 1-day draw-down and then more mistakes furiously trying to make it back. I did some real damage, going from up 85% on the year to flat or a little bit down at this moment. The single most shocking thing about this situation is that I spent about 8 hours the day before this started focusing solely on risk management. I logged and analyzed all my trades for the year, calculated my expectancy, looked at my mistakes, etc. Further, I calculated new per trade and per day loss maximums that I was to strictly adhere to. The reality is I was up $100k on a form of trading that I knew could eventually burn me, and with that recognition had committed to "reform" before the damage was done. What is so absolutely shocking is that THE NEXT DAY I let a 20% drawdown run up. What this tells me in no uncertain terms is that I cannot actively trade any more at this time. The fundamental problem I have is a lack of time and focus to conduct my trading. Because i have to "steal time away" to trade, there is a high propensity and motivation to "make use of that time" by getting into trades, even if no good setups are in play. Worse, I literally get interrupted all the time, and using high leverage for short duration trades, this is deadly. Lastly, I need to beat risk management into my core not in a philosophical way, which is already in place, but in a behavioral way, which takes focus and repetition. I don't have the time and focus to achieve that now. So, for the remainder of the year, I will be investing cautiously with some occasional swing trading at extremes (like today). I won't be scalping or intraday trading. It's definitely disappointing, as I had amassed a string of nearly 12 weeks all positive, with 80% of all days positive, and no significant drawdowns. I do believe I can trade consistently profitably, but not without a full time focus. I need "behavioral training" through consistency and focus that can't be achieved in spurts of attention. Cheers
Sorry to hear. I have been busy as hell the past week and a half. So I have not been trading. It sounded like ealier this week or last week that you had a strong conviction that oil was going to go back up. If you were trading the long side im sure you spent some money. Anyways, why not just buy put or call options in the direction of your convictions. Its a hell of alot cheaper if your wrong. Im kicking myself for not just buying puts when oil was at 87. I had a short position that I closed to early so I only made 12k of the potential I could have made. If I had bought puts I would have been up 100k Here is my plan incase it might be of any use to you. Since im not going to be active for the next couple months im just going to throw 5k a month at either put or call options of what my bias is for that month. This way if im wrong im only out 5k, if im right I should double,triple my money easy. This has alot less risk then trying to pick a top or bottom, plus I don't have to actively manage it. Hope this is of use to you.
Thanks man...thats not a bad idea. I am reserving 25% of my portfolio for "swing trades at the extremes". For example, i shorted VXX at the open this morning and i think that is going to pay off nicely. I'm not convinced oil is quite there yet. Certainly didn't like its action today given the decent ES move. Anyway, I did almost all my damage on the first day crude collapsed, and it all happened within minutes. Yes i had a conviction crude would bounce back, and hoped to make my money back on it, but the real damage was due to a "technical trading error" on my part, and not because my conviction was wrong. Anyway, i like your idea.....good way to take a few swings with low risk. My main goal at this point is to still end the year profitable, so I am going to be pretty cautious from here on out. (i doubt i'll end up 85% tho....should have just quit while i was ahead).
Anything can happen. You can end the year up 185%, or more. I'm glad to see you are alive. I was worried (it's a "mom" thing) when you went MIA after our convo last weekend and Austin's cautionary post. All the best!
Thanks Donna Actually, i covered early Monday morning and got out flat. However, I didn't sleep a wink sunday night and was down huge overnight. Just got lucky to get out on a bump early morning. Anyway, at that point I had already done all the damage, i was just trying to swing big to recoup my losses. I'm really, really lucky i didn't lose a ton more because i took desperate risks. Hard to feel lucky after losing 100k, but having my starting capital from Jan 1 makes me feel at least not so morose.