I have also added a few more - ok, many more - paragraphs to the section "monitoring of daily performance" on that posting.
On second thought, I'm just going to transfer those ramblings to this post. So, here goes:
Monitoring of Daily Performance
I've always been the kind of person that hates to keep scores. I like details only when I'm looking for clues and finding answers to questions. I hate details linked to post-events. I'm a lousy book-keeper (little wonder that D's the one managing our finances and diligently keeping track of daily expenses and monthly and yearly budget...so it's baffled me for a long time why I was tasked to look after the department's budget for over 2 years when I was at my previous job)
But, after series of losing days (something I'm definitely not accustomed to), I'm adamant about doing just about anything to get back on the right track. As I've said many times before, I don't like to lose. That's a gross understatement of course. I am fully aware that the only certainty in the market is that it will open and close. I am also fully prepared for a seemingly perfect trade to turn bad due to factors that are beyond my control - which makes cutting loss as soon as the trade is no longer going as I've planned so critical. But I utterly hate multiple losing days. It tells me that something's very wrong with my psychology, or the market. But I can't do anything about the market, even if it's to be blamed. But I can do something about myself.
My best month has been the one where I traded more contracts than I should. For someone who started out with merely 28k, and who's never traded the futures market, that was more than rash. At that point, it didn't occur to me that it was an atrocious thing to do, coz I had been trading 10 GS options contracts and was used to the big swings. What's worth mentioning again here is that I was very good at running back then, and the market was not as uncertain and haphazard as today, so I managed to escape a blowup.
On the months that follow, my monthly average profit was around 2 to 3 k. Not impressive for a full-time trader. I couldn't get any better, coz my daily gains have been pretty consistent - they were capped at 1 to 2 points, sometimes 3 (which was enough to make trading 5 contracts very lucrative though). Because I scalped, I was paying a lot to my broker, and on days that I started out losing, I have to make many more trades to make up my loses, and in the process, paying more towards commission. It's like you take a loan from a loan shark, and each time you pay him back, you're just paying interest.
I'm done getting in and out of the market like a maniac. Unless the day is perfect for discarding charts for the tape, I am going to be disciplined about only entering on the setups that give me the best edge.
As I've mentioned before, I have never entered and exited (especially the exit!) a trade based on any systems or after having walked through a checklist to qualify that trade. What I did, on the days that I was more "disciplined", was to wait for my favorite setups, then get in at "market" (very stupid thing to do) when I see that price is going to break, and I get out usually before the completion of a single 5 min candle. On the days that I get a 4 to 5 point gain, I had simply gone to bed after putting on the trade. Which actually didn't happen more than 3 times, I think. And those were the days I had to be dragged away from my computer. Sometimes, D will just turn it off and literally force me to go to bed, after making sure that I've put in my stop loss and profit target of course.
Since Dec 08, I have gotten so lost that I started to wonder if I actually knew how to trade properly. What I know for a fact is that I don't have a penchant for gambling. If that's the case, I must be working towards something. And I can't know what it is if I don't document my thoughts that lead to the specific decisions I made for each of my entries and exits. What patterns have been giving me windfalls, and what are the ones that have been screwing me. What behaviorial and thinking patterns have been guiding my losing and winning days - if I make it a point to keep tabs, I could find out things about ME that I didn't know before. If I continue to be blind to who I am, I'm going to continue to let the part of me that sabotages my trading continue to sabotage my trading.
So, I'm keeping scores. I've developed a very primitive scorecard to get things started. Overtime, and with more data generated from trading, I will refine it to capture even more data.
It's time that I find out what is it about me that's hampering my progress in trading. I don't care what the market does - if it sucks, and I choose to trade, then I suck even more than the market.
But, after series of losing days (something I'm definitely not accustomed to), I'm adamant about doing just about anything to get back on the right track. As I've said many times before, I don't like to lose. That's a gross understatement of course. I am fully aware that the only certainty in the market is that it will open and close. I am also fully prepared for a seemingly perfect trade to turn bad due to factors that are beyond my control - which makes cutting loss as soon as the trade is no longer going as I've planned so critical. But I utterly hate multiple losing days. It tells me that something's very wrong with my psychology, or the market. But I can't do anything about the market, even if it's to be blamed. But I can do something about myself.
My best month has been the one where I traded more contracts than I should. For someone who started out with merely 28k, and who's never traded the futures market, that was more than rash. At that point, it didn't occur to me that it was an atrocious thing to do, coz I had been trading 10 GS options contracts and was used to the big swings. What's worth mentioning again here is that I was very good at running back then, and the market was not as uncertain and haphazard as today, so I managed to escape a blowup.
On the months that follow, my monthly average profit was around 2 to 3 k. Not impressive for a full-time trader. I couldn't get any better, coz my daily gains have been pretty consistent - they were capped at 1 to 2 points, sometimes 3 (which was enough to make trading 5 contracts very lucrative though). Because I scalped, I was paying a lot to my broker, and on days that I started out losing, I have to make many more trades to make up my loses, and in the process, paying more towards commission. It's like you take a loan from a loan shark, and each time you pay him back, you're just paying interest.
I'm done getting in and out of the market like a maniac. Unless the day is perfect for discarding charts for the tape, I am going to be disciplined about only entering on the setups that give me the best edge.
As I've mentioned before, I have never entered and exited (especially the exit!) a trade based on any systems or after having walked through a checklist to qualify that trade. What I did, on the days that I was more "disciplined", was to wait for my favorite setups, then get in at "market" (very stupid thing to do) when I see that price is going to break, and I get out usually before the completion of a single 5 min candle. On the days that I get a 4 to 5 point gain, I had simply gone to bed after putting on the trade. Which actually didn't happen more than 3 times, I think. And those were the days I had to be dragged away from my computer. Sometimes, D will just turn it off and literally force me to go to bed, after making sure that I've put in my stop loss and profit target of course.
Since Dec 08, I have gotten so lost that I started to wonder if I actually knew how to trade properly. What I know for a fact is that I don't have a penchant for gambling. If that's the case, I must be working towards something. And I can't know what it is if I don't document my thoughts that lead to the specific decisions I made for each of my entries and exits. What patterns have been giving me windfalls, and what are the ones that have been screwing me. What behaviorial and thinking patterns have been guiding my losing and winning days - if I make it a point to keep tabs, I could find out things about ME that I didn't know before. If I continue to be blind to who I am, I'm going to continue to let the part of me that sabotages my trading continue to sabotage my trading.
So, I'm keeping scores. I've developed a very primitive scorecard to get things started. Overtime, and with more data generated from trading, I will refine it to capture even more data.
It's time that I find out what is it about me that's hampering my progress in trading. I don't care what the market does - if it sucks, and I choose to trade, then I suck even more than the market.
The template for my scorecard can be found in the post from where the above paras were hijacked.
2 comments:
Hi Jules,
After a LONGGGGGGGGGGGGGGGGG time I got a chance to surf and you know what I would jump to first - my favourite blogs...
When I checked this one (yours) I found it changed !!! nice one and better !
But, there is one thing to consider - extras on left side can make delayed open of you blog page on slow connections...
Happy blogging...
Hey Harry!! :-)
I know, I'm being logged out of my own blog several times a day!
Yes, am definitely considering removing some those items there.
Thanks for dropping by!
Muak!
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