Learning to Lose, Not Worrying

Go outside, do something, chase your dog or cat around the yard, take your lambo for a spin, then come back and look for the PHAT pitch. They don't happen every day.

 

If you want to reduce your losses enter in chunks instead of the full size.

Let's say you want to enter 10 contracts on the NQ, you are likely to be wrong picking the first trade, simply because it is very difficult to pick the correct moment to enter.

Enter with one contract, if you are wrong, you can average it with another one at, let's say 50 ticks.

If you are wrong again on the second one, which actually happens a lot, you send the 3rd one. And so on. You have 10 opportunities to be wrong.

Do not martingale it. Just keep the same size.

Eventually the market will reverse and your averages will increase.

If you end up sending 10 trades in chunks and you are still at a loss, you better do something else.

 

try losing 20mm in a single day before you cry ...

 

Peanuts, Bill Hwang lost $20 billion in just two days..

I wonder if he cried at that lost?

 

I like that.

 

As I have gotten older, don't average down any more, it not cause it won't work any more, but I don't want to work as much any more. In past three losses in a row could hit me 7 figures, wiping out two months of profits, but year after year averaging down proved well for me. But I don't trade heavy any more, go for 2 ES points per session on less size keeps it interesting enough. Have very high daily win rate, risk 2 to 3 times goal on couple of trades. Many times done In first 45 minutes and automated. Goal is daily consistency.

If system loses 4 points, next trades goal is 4 points or close to it, keep trades till system gets to even then trade to get 2 points on day.

 

7 figures wipes out two months of profits? Rookie numbers, Bro.

 

That sounds a lot like revenge trading.

 

You traded at an IB/ Hedge fund??

 

Just throwing this out there from Investopedia...

Is There a Proper Asset Allocation by Age?

Your age dictates how much risk you're willing to take on in your investments. The general rule is that the younger you are, the more risk you're able to tolerate. The older you get, though, means you must cut back on the amount of risk in your portfolio. The common rule of asset allocation by age is that you should hold a percentage of stocks that is equal to 100 minus your age. So if you're 40, you should hold 60% of your portfolio in stocks.