Neke, Out of curiosity, may I ask if you're trading this as a proprietor or within an entity such as a C Corp or LLC? thanks
Gotta love all the people preaching like Moses but when you hit the P/L journal most of them are nowhere to be found. Let's not forget the most important part of trading, psychology, that cannot be taught. Godspeed Neke.
Neke, I just joined the forum. Yours was the first and possibly only one that I will view today. I also have an Ameritrade account. My concern here is that I believe it would be prudent to buy puts on positions for "insurance." I've been studying poweropt/webinars.asp for over a week, now. I have never used this method and my account reflects it. I plan on using it, though. Right now I am upsidedown in FAZ and I am just idling and planning ways to turn my account around. I wish you the best.
What many fail to realize is that just one good trade will bring him back into the black. In fact, one good trade can make him reach his goal within a few weeks. There are many single digit stocks on the move up all the time everyday doubling and tripling. He just needs to get on the train and ride it up like most ET traders do all the time.
This is the kind of thinking that brings gambling addicts to their darkest days. Neke doesn't need this kind of bullsh*t on his journal. He's had $60K trades in the past and knows that a home run or two can "bring him back". He puts on big trades expecting big profits; that's his style. Sadly he's stayed in losers far past the point of invalidation, and exited with a huge loss close to the capitulation point, only to see the trade reverse to break even or possibly even a profit. This lack of risk management causes a trader to think ANY trade will eventually become profitable with enough patience, averaging, etc, and the trader continues to repeat the same mistakes until the account is gone. A professional, successful trader will rack up the singles day after day, and now and then hit home runs with the bases loaded because they've trained well and are prepared when the big game is on.
Well, if he bets heavy (even not with margin) on those dollar stocks, he could lose 50% of his account value overnight as well. If betting on those stock were so rewarding without much risk, I guess everybody would do it. Reward and risk are always tied up together. You mean "if......", that is a big IF. Yes, he could get his account back on one good trade (betting really heavy), but what if he bet a wrong horse or wrong direction? There is no such thing called free lunch i the world. Basically you suggest him take more risks to get his account value in one trade. Pretty scary in my mind.
That observation is right. I've had a tough time adjusting to the fact the market sentiment has turned, which was not helped by bad habits. It is such a temptation trying to keep doing what used to work. I think one's success as a discretionary trader is proportional to ability to adapt to changing market conditions without big bias. Definitely yes. I'm yet to find the time to compute exactly how much, but I believe averaging down has cost much both this year as well as last year. The good overall performance last year obviously masked the amount lost to that bad habit.