Big hits go with swinging for epic returns, draw-downs of 30-50% are the norm. You trade a $7k north of $100k in no time and give back 30%, that's still remarkable performance in my book.
One thing I never saw you mention was the reason behind the huge loss. Was it just a trade that finally hit the stop, where as none of the other trades do? If this is the case, then no problem. A high win rate with an occasional large stop can still be absolutely profitable if the numbers make sense. But if the loss was as a result of you doing something outside of the plan and going on a tilt, then that perhaps would require some attention.
Along the lines of risk of ruin: Here is something that might help him set the bet size: https://www.elitetrader.com/et/threads/kelly-criterion-risk-of-ruin-as-risk-management-tool.310919/
That is what I was mentioning....revenge trading can cause that. I guess it's OK to revenge-trade, but you gotta stop when you hit daily max loss limit.
lost big again. how do you keep your head straight after massive losses? the bright side is i didn't completely obliterate last months profit..but this is just crushing.. feel like going to the drawing board..or is the betting size the problem. fuck trading is hard. We'll see how this month's statement looks like. I'm still withdrawing to fund my Coke habit lol
Sorry to hear that. I think the best is to avoid big losses to begin with. But if the big loss is a fact - I don't think there's any other way than taking a few days off and trading very small initially. I know at least the way I'm wired I tend to want to make back the loss - which again just enforces really bad behavior and poor trading.
Where are you at, Bro? Net liq? Give us some news so we don't have to do a welfare check. You'll get it back.
So, take a break and salvage what you have. The only way you can get back into your groove is with a clean slate and those losses erased from your mind. You never revealed much about your method, so it's hard to say, but I suspect you made those returns on very high leverage and possibly a bit of luck too. Let's face it - there's an element of luck involved in this game. I'll readily admit it. Both good luck and bad luck (like getting low ticked/stopped out and then have the market go your way just after. Then, if you continued trading at maximum size you're bound to have a bad day. It happens to us all. But if you're trading with very high leverage it's very easy to become emotional and let a bad day turn into a disaster. I've had it happened more times than I care to remember. Bet size is a personal decision, but unless you have a method with an extremely high strike rate and extreme discipline (being able to shut down your system after a loss), you basically have to accept wild equity swings when chasing those huge returns. Would it be possible to set a daily loss limit on your AMP account? Could that possible help you? Like a 5 % daily loss limit?
He already stated that his daily loss is like 30-60% of accumulated profits. That comes out to $20-$40k....insane IMHO. Should be around $10k or 10% of account balance.