<i>"I think you may be bored. Boredom is a dangerous emotion in trading."</i> Definitely, without a doubt. RM, we cut our teeth during a time where the NQ routinely made 200+ point intraday ranges. It even sprinkled in a few 300+ point intraday ranges. $150 stocks like PDLI commonly swung thru $25 rolls two or more times per day. I doubt many active readers here can remember the Dow being negative -400 index points on a gap & crush off the bell, only to snap back violently and turn green before noon. How many YM traders here (or anywhere) have ever faded a -400pt opening gap and held longs waiting for it to close? From 1999 thru early 2003 it was sheer pandemonium all day, more sessions than not. Conditions were favorable for plunging, doubling down and holding on for recovered gains from unrealized losses. I recall reading where a friend / mentor of yours would be down six figures in the morning, leave the position open and come back hours later to find it now up six or seven figures. That's how I learned trading works on an internal = emotional level, too. * With rare exceptions now, those markets are gone. The only thing comparable these days are commodities in general with crude oil in particular. Equity markets have their moments, but not even close to what it used to be. Now we have to carefully pick our spots, and have the fortitude to sit idle thru the lulls. Sitting idle for traders who learned thru the wild times is incredibly tough, maybe tougher for us than others. Trying to press the pedal into sideways churn will spin wheels into a deep hole. I've done my share of that in the past, it took forever to ingrain the fact that trading = making money is more boredom than exhilaration. I know for an absolute fact that most traders here (and everywhere) who finish a day with net-loss began most of those days with modest to solid profits. In other words, most losing days at the end were acceptably profitable at some point earlier in the session. Food for thought ** Excellent to hear you back-filled a significant trough. There ain't a person here who isn't rooting for you (and likewise for every serious trader) unless they are complete, legitimate jerks. Now it's time to quit digging new pits in your capital reserve. I had a similar conversation with group of traders yesterday. This profession is 90% mental / emotional, and we're reminded of that fact on a daily basis. Heeding the reminders and making behavioral change is the tough road to continual success. Take great care of yourself, RM
so for the benefit of the board, perhaps you you're willing to share what you've learned from this experience. you mentioned waiting for your "pitch" or set up being important (ie, taking thousands of marginal trades that you said you shouldn't of), and a bad market, but is there anything else? ah forget it, i have an awful habit of giving unsolicited advice, so why fight it was going to try to lead you into figuring it out, but i'll just tell you. there are at least 3 lessons you should take away from this. i'm a reasonably successful trader, so feel qualified enough to give the advice. plus, advice is easier to give than follow oneself 1. your position sizing and risk managment is way off. i'm not sure of your account size, if 10 million, certainly 800k is acceptable, but if you're trading with a million or you need to cut down your size or tighten up your loss cutting, or you will blow up, like a larry livermore, despite being a good trader like he was. sure, there are trades you can be 70-80% confindent in, but it's just a probability, anything can happen (bomb, govt intervention, iran attack, nuke, massive earthquake, who knows), so in the end, we really don't know which trades are going to be the winners or losers. it's a probability game, and you need to structure your trading size so that you'll always be around. review your trades, take your biggest losses, your longest string of losers, and come up with a formula that will tell you what you're proper position sizing or risk per trade should be (ie, 2%, 3%, or 4%) or whatever. for example, if you're comfortable with being down 20%, you shouldn't risk more than 2% per trade by the studies i've read. 2. it's not the market, it's you. obviously, you do well in high volatility, and volatility is cyclical, so when you see it start to revert (low volume days), cut down your size, trading, or adapt to another style if able. the market may not have been lined up with your style, but that doesn't mean there weren't opportunities for other styles. the early part of the year was extremely volatile, the middle volatility came way down, and lately it's been volatile. easier said than done, as a tiger can't change his stripes, but you can take steps to at least mitigate the losses when conditions aren't ideal for you. 3. be humble and invest in yourself. you had a good 2007, so you overtraded. recognize this for next time. take a vacation, or at least realize what you've done in the past after good streaks. i did the same thing earlier this year btw. You're a good trader, hell, anyone that's profitable can be qualified as good trader given 90% fail by all studies, but don't let yourself get a big head. with all due respect, you don't adapt and switch styles well, nor seem to read much up on other strategies, and are too arrogant to recognize that there are always oppportunities (even in low volatility environments you can do options strategies for example). so you're a good trader, but not a great trader (i am in the same boat). the market changes, new rules change, more algorithms etc, but that doesn't mean there aren't opportunities if you adapt and are open and willing to learn. with regards to poker, even at 10-20 NL, much less 50-100 NL at the bellagio doesn't seem worth it unless for entertainment value (or to recruit investors ) 9/10 people at the table spend 10-12 hours a day at the table, every single day, (i live in vegas) and even if you're a good player, say in the top 10%, those people are just going to be better because they practice more. plus, they're mostly nits and play the nuts. a better strategy might be to stuff a piece of coal up their ass, and make a diamond. sure, the above is easier said than done, and i don't follow my own advice all the time, but that doesn't mean it's not true. we all have strengths, and weaknesses, recognizing as much is the first step, doing something about it is the second. personally, i'm looking to automation, and continuously read on other strategies, and always blame myself for every loss. it's always my fault. once read a good quote that said something like, if you're crazy and poor, you're deemend insane. if you have money, you're eccentric. gl. my two cents, from one eccentric to another.
You da "man" Mr. Fuggin.... It's been a while since Atlanta, and I hope you're doing well...it's always good to see others share some experiences here on ET. (I assume it's you, don't recall you living here in Vegas however)?? Don
hey don. ya, moved out to your neck of the woods and have often thought about stopping by to say hello, as i live a mile or two a way from your office. i got the place, not coincidentally, around tax time last year. let's just say my timing on trades is slightly better than my real estate timing least i'm saving 10% on state taxes