icemans' IRA trading Journal

Discussion in 'Journals' started by iceman1, Jan 21, 2006.

  1. start is February 1, 2006.

    * trade options and equities - maybe some (cash) covered puts

    * will post all trades (attach files displaying gains and losses)

    * will post starting balance and target (returns) in $ and % for 2006

    * will state premise/plan for trade

    I have computed that in the past 3-4 weeks early and impatient exit has forfeited further profits in the account (with typical trade size being 4-8) of at least $18-20000 on about 6-8 trades; annualized that is a big number. As crazy as it sounds I do believe it is possible to trade in a small account like this one and make high annual returns >200-400%+. Not saying I will do that; but I definitely believe it is doable. However I personally could not perform at that level in my current low-energy state (as commented on below); and no doubt it is easier to establish better numbers on a smaller account size.

    I am doing this as a challenge to myself to improve my exit strategy. I am doing this Journal primarily for myself - not for ego or bragging rights or to impress anyone but myself or for track records. Rather I need to find out why I keep making great entries and some brilliant trading "calls" and yet am failing to maximize Returns on those positions -- all in very short time frames.

    An example is once again exiting the 8 SOX February 500 Puts too soon even though I had set a mental target # on SOX of minimum 515 -- and more likely 500. Certainly I did not expect a 21 point sell-off in SOX the day after entering my largest size this year in this account. But in actuality I intentionally increased size as part of my 'new' methodology/paradigm to focus more on positions sizing----- and thereby seek to increase size based upon my ranking of trades. I felt this SOX trade had a 90% probability of success and that I would make at least 100-250%. It was in my view a "James-Rogers-go-over-to-the-corner-and-pick-up-the-money" trade. Thus size was increased accordingly.

    One reason I exited too soon was lack of sleep, and being increasingly mentally exhausted from too much diversified options trading and managing in other accounts (which I have commented on in the other Journal). The message is --- restful sleep is vital to anyone who seeks excellence in trading. I don't care what age (I have pulled all-nighters and even been up two nights in a row in college) you will need sleep and a calm mind in order to trade to one's potential.

    Another was having a 'friend' stay over (a female trader) and she was in my trading office half-dressed sitting nearby with a blanket - just quietly watching me; not bothering me at all. But given this was expiration week I did not need this distraction on a milder expiration day much less a wild day like Friday!

    The third reason for poor exit strategy was inner conflict. I am seeking to revamp my trading methodology in all accounts by reducing number of positions and increasing size, but also I want/need 2-3 weeks in Mexico or the South Pacific. But you can't do that with multiple open options positions to follow many in back months. So probably I was not mentally prepared to sit and monitor the SOX and other open positions where I was able to ring the register. I was not prepared to deal with the inevitable swings in open pnl. By ringing the register I thereby remove my responsibility for monitoring the trades. But anything worth doing is worth doing with excellence. Sure there is no perfect exit; but relinquishing thousands of dollars in short time periods on small lot trades is problematic and frustrating. The latter of which can lead to undisciplined trading down the road. So I likely got what I wanted albeit I saw $2800 go into the pocket of the trader who took the other side of my sell, on this one trade alone even though I made approximately $2200 on the trade.

    The final reason for my recent premature exits is my long held view that there is almost always a chance to get back in and profit. But this works when one is operating at a high level of focus, energy and enthusiasm. When as above you are thinking more about time off, a sunny tropical beach and party-time or other problems and distractions --- running profits and re-entering and/or adding on without hesitation at the moment you observe that an exited position has legs--- that is being committed to your shot -- will almost always be compromised.

    So lack of of sleep, inadequate management of outside distractions, inner conflict and waning enthusiasm and focus are keys to forfeiture of additional LARGE profits on many positions yesterday--- and all this month in this account. The cliche "it's a marathon not a sprint" or "life is a journey not a destination" are never more true than in a trading business. Thus we must pace ourselves always so as to reserve high levels of (mental) energy, focus and capital at times when the best opportunities arrive on the doorstep!

  2. 1/25/06

    will post 2006 trades for Journal starting today -- rather than 2/1/06 since I did a small lot trade just now.


    +4 Feb 75c @ 2.65

    entered trade since I am already short this strike in another account (from 3.7). The trade goes against my bias which is -- AAPL trades to <7250 min. The 70 level wouldn't surprise me - but the 80 is also doable. Go figure!? Plan is to scale into 10 total as (IF) AAPL sells off further.

    will post starting account $ after close
  3. APOL

    going to enter 15-20 APOL March 55c @ <2 (OR maybe Feb at that target level)
  4. CME

    + 4 Feb 390 Puts @ 7.8 (avg)


    placed order selling 4 Feb 75c @ 3.60 at open - missed by .20 - raised it to $4
  5. order selling CME Feb 390 puts @ 10.20
  6. when I get my "signal" guess I ought to begin scaling in; "maybe" yesterday was a good entry level??! I got cute wating for a few more pennies on the downside. BUT let's see if I still get a 2nd chance to enter my APOL 55c at a price I am happy with-- market usually offers them IF we are patient.

  7. SOX

    + 4 SJX NG (Feb 535 puts) @ 5.40 avg
  8. day order selling SJX NG @> 9
  9. sold 2 CMJ NG @ 9.50

    PnL +340

    order selling 2 more @ 10.80

    (can't get stock to crack - frustrating how we have another bubble which will likely end ugly- plus no one bidding for puts- will keep on this one and finally catch it)

    still + 2 CME Feb 390p @ 7.80
  10. sold 1 @ 7.20

    PnL +180

    +3 @ 5.40

    orders in selling >8.4

    come on baby - fill the fricking gap------ already !!
    #10     Jan 27, 2006