My 14 year rollercoaster trading futures

Discussion in 'Trading' started by flipside21, Jun 26, 2011.

  1. Way back in 1995, I was still a naive kid in high school. I received a booklet in the mail from quasi snake oil salesman Ken Roberts about TWMPMM book. This sparked my initial interest in commodities. Read a lot of other books since... Market Wizards, Trader Vic, Alexander Elder, Jesse Livermore, Mark Douglas, Robert Prechter, and many others.

    First trade was long Copper on a seasonality and made $250 profit. After that it was all downhill. $10,000 account was wiped out within a year.

    Avoided futures for a while, then reentered the arena in 2001. Long stock indexes on 9/10/11, then woke up to see the tragedy and instantly futures went limit down. That account blew up as well.

    Started again in 2003. This time I saw opportunity in Silver <$5 and was long an insane >20 contracts when margins were still very low. Forgot what happened exactly, but couldn't hold on and you know what happened to silver ever since.

    Late 2003 caught the Soybean bull market, and made $40,000 in short time. Lost those gains shortly thereafter.

    2003 - 2006 was break even period.

    Late 2007 I had $10,500 in my trading account. I could see the stock market was going to sell off, and Eurodollars didn't hadn't priced in interest rate cuts. This was my big opportunity. I transferred $9,000 from my bank account and borrowed $18,500 from my credit card to be balls to the wall long Eurodollars in Dec 2007. It soared I kept pyramiding up. I was adding contracts almost every day going from 5 to 10 to 20 to 50, and I was thinking about adding 100 contracts the next day but decided not to. Of course, this is financial suicide should Eurodollars reverse and I was playing aggressively. That afternoon the Fed announced a 1/2 point rate cut and could have been $100,000 gain in one day had I added those 100 contacts. Account was $100,000 at this point. Anyhow, quickly withdrew money to pay down the credit card. Kept on trading at a break even level for many months.

    Could see the account dwindling again, so I withdrew more money. More trading losses followed. Last trade was an aggressive short stock index at Jan 2009 and going bearish into Mar 2009, and as it went down I kept adding my shorts like a wannabe Sell'em Ben Smith. I thought it would go down a little further, but it turned out to be the low. Market massively reversed to upside, and most the equity was wiped out. I decided to close my futures account at that point, and have not traded futures ever since. My net result in trading futures were that my past losses were almost exactly offset by the Eurodollar gain.

    My main issue with futures was always the temptation to overleverage. Temptation was too great for me, and I couldn't make any progress, so I knew my futures trading time was up, a personal time stop.
  2. Lucias


    Did you ever stop to evaluate why you were lost your gains? I do not recommend you to trade futures.
  3. What exactly happened in the futures market on 9/11 and the days after? Sites I've read just say 'stock market was closed', but did ES and everything else halt exactly the same time as equities?
  4. It sounds like you didn't have a strategy. You are going to need one if you trade again..