I wonder how many other traders have experienced this frustration: You started trading stocks at least 5 years ago, when trading was fun. The movements of stocks had a rhyme or a reason. You were reading the tape, specialist, marketmakers, news, chart or whatever... but most importantly you had a good "feel" for what was happening in a stock. You could almost trade and profit instinctively. Even losing money was somewhat fun, because you sensed that a buyer or seller was gone and you were a hero for getting out fast when you saw that happening. It was a sword-fight to be sure, but the game seemed fair and you knew your opponent and countered his moves. Moves were smoother, ticks were six cents, and there was enough liquidity to average into some nice sized positions. That has all turned into an utter sloppy mess. You are regrettably now dealing with a tedious daily grind trying to make what you can with small positions that you can get out of in low liquidity. Watching the penny ticks is tortuously boring and makes you regret starting another day of this slow monotony. Your once exciting job now feels like working an old factory assembly line. One thousand stocks became like trading futures due to the SHO rule. Boxes, penny scalper and nx'rs wreak havoc everywhere thanks to all the new regulations over the past few years. Of course to survive you must adapt and adjust, and you need to keep yourself motivated to do so. Would anyone like to share how they have kept themselves motivated to withstand the drudgery and adapt to the new market over the years?
First, I try to look back on my life situations that were similar where my motivation had changed, felt burnout or lost enjoying the task at hand...yet non-trading related... Sports, relationships, academics, hobbies, environment habitat, past careers et cetera. Whatever method I used to resolve the situation then is the same method I used to resolve the trading situation. Although I don't trade stocks (I trade different trading instruments)... Everybody has a little different way of handling such. Some trade a different market to get a different perspective. Some may realize they haven't had a vacation (no contact with the market) in many years in which they traveled abroad. Some realize they are too slow to adapt or didn't want to adapt but now realize they must adapt. Some just changed career. Some made changes in their personal lives. The above (changes in their personal lives) was the key for me. I discover that there were other areas in my personal life that was experiencing the same thing I felt in trading at the same time. Forcing me to to a complete inventory of how I interact with the markets and other areas of my personal life. Then I began first with the easiest thing to rekindle the thirst...a serious hobby (photography) that was suffering the same fate as my trading until I worked my way back up through that inventory to what I do for a living... Trading. NihabaAshi
I don't trade stocks anymore (aside from ETF's and very occasional trades in individual issues) . I can relate to what you are experiencing, I am not sure how this new SHO rule is affecting trading but personally as time went by and I became profitable - i.e. net positif I am not making large amounts of money- I noticed that I don't even enjoy it so much even during very profitable periods which are usually those awash with opportunities many of which I of course miss. I don't really have long and big losing period, just very long periods during which I don't trade, don't make anything or lose small change and those periods are terrible for motivation and self esteem. I try to develop another source of income and of satisfaction in life and find that it gets me more motivated to push myself in the market .
Burn out and always being tired is a signal to me to take a break, maybe a day or two off. Getting a mistress is a fun way to spend time and money too.
An Easy way out of burnout is to move away from decision making and just trade a mechanical System and you will have an exact opposite problem - Boredom.
Trading for more than 10 years now, I can certainly understand the comments about the lack of any sensible movements in the stock market recently. Quotes mean nothing as they are regularly not firm and not filled. The penny grind has killed the market as we now have no meaningful movement. We have the ECNs being used now to constantly flash bid/offers that are constantly fighting with each other with the result being a lot of quote activity but no trades as no one really knows whether or not what they are seeing is real and will be honored, or just computers playing one-upmanship games with each other. Many times now when tryng to get a fill, e.g. buy at say 65.50 when there are several ECNs showing offers at that price or less, the instant I send in my order, all of the offers magically disappear, with no fills to me, and the bid/offer spread moves up a few pennies. Of course it could just be me not reading the market properly and putting on one lousy trade after another. Right!!! How to fix this: 1) Make the tick size 5 cents. 2) Make all bid/offers firm for at least 3 to 5 seconds. This will increase the risk to all of the penny monkeys as well as provide better liquidity at the various tick levels. It will also probably be better for the general public as they will get scre@ed less by the various entities that exert control on the market. IMHO
It scares the crap out of the penny monkeys if you send in a limit order to buy up to X at Y price. Its fun, just try over illiquid times like 1215 to 1230 or so.