Quick background info: I started trading full-time three years ago and quickly became profitable, attributing much of that to a generous market and a great mentor. I enjoyed healthy profits my first year and second year. I began to "push it" this year, and quickly banked six-figures in the first quarter of 2010. Then I hit a big loss...and another...and another. I couldn't handle the losses, 2/3rds of which were caused by my own lack of discipline, lack of experience with large losses, etc. In six months, I have dropped my account to almost 10% of what it was, but I still have more than what I started with. My confidence is thoroughly shot now, I seem to enter nothing but wrong trades, and I have a number of expenses I've acquired since my success. My strategy does not work near as well as it used to, and I need a complete overhaul of my risk management structure. I am working on a number of new ideas at the moment, which is daunting. I cannot afford to lose anymore out of my account (due to dumb trading, at least). The loss was quick and caused a large spike in my anxiety. How can you manage this to get back on the horse? I am seeking the advice of career traders who have been to the edge and back. I am trying to re-invent myself and make it over this hump, but I am afraid I may have dug myself too deep a hole. If you have been in my shoes before, it is harrowing. I still want to be a lifetime trader, if that makes any difference. All comments are appreciated, thanks in advance.
It's a confusing post. If his account is 10% of what it was, that would mean he lost 90% of his account value. But he still has more than what he started with.
I have but it takes time. You need some time off tho and get your head in the game. You have a lot of work ahead of yourself and idk if it's worth it for you esp. with your increased expenses
Get back on the horse, follow your rules, trade with smaller size the first month, Look at it like a book, those losses were the last chapter, label it and move on to the next chapter. Dont look back,,,,, the best qb in the NFL have a short term memory problem, they dont remember the prior recent plays in a game. They cant, because they know it has nothing to do with the next play. (sounds like trading) Example of concurrent plays:, 5yrd pass, 10yrd pass, sacked, loss 15 yards, pass 40yards touchdown. Stop looking in the rearview mirror, the future is ahead of you not behind. EF
Disclaimer: I had a lot of trading experiences over a number of years but I am not a trading guru. So, take it for what it's worth... I think your problem is you got over-confident. Hence: 1) You enter a trade before you have a confirmed signal. For this reason 2) You have larger than usual number of losing trades 3) You are so confident about yourself that you can't say: "I have had enough losses for this day (or week), I am gonna have a break to recuperate." 4) You don't exist a profitable trade early because you believe you can predict a larger move.
It's simple, * Trade small (stop trying to push it) until your confidence returns. * Markets are forever changing via volatility. Simply, your entry signal may be OK but your trade management after entry most likely needs to be adapted to the changed market conditions. * Reduce your personal expenses to better manage your stress level when losses do occur. * Contact your mentor is things continue the wrong direction. Mark
I started with a decently funded account but blew it away almost in one year trading everything from stocks, futures and forex. There was no beginners luck for me. I learned a lot in the process but have not been able to find an edge which will allow me to make it back.