Keep Calm and Don't Move Your Stops.....

A little risk management saves a lot of fan cleaning!

The Purpose of Life is Joy!!

Tuesday, January 17, 2017

+.50%+ .50% for 1.0% on the day.

One trade this morning well before the open. Bought 53.04.....Small risk, less than .125% exited for a nice .50% gain.

I will wait around for the open and see what happens but I'll be gone shortly thereafter.

Today was a case of waiting for smaller risk. Opportunities presented prior to this but risk was greater. Just have patience and sure enough, the right trade with smaller risk showed up. Before I would have tried to take the first opportunity with the higher risk and try to use a fixed stop not appropriate for the risk. That almost always got stopped out. Now, just wait. It pays off.

Cheers.


EDIT:
 8:25AM

Another opportunity presented itself just before the open with minimal risk. It wasn't super clean in terms of how the trade progressed but it worked out ok in the  end. Was almost stopped out, missed me by two ticks but ended with another .50% and that makes me happy. Bought 53.10 and exited at +.50%.

Went took a shower, did my morning exercise routine, grabbed some food, came back and edited the blog post and now ready to hit the books for the day. Should be exciting!!! NOT.






4 comments:

  1. it feels, from afar, that there is less drama in your trading lately...
    this is exciting, it should be,.....boring. cruise control....

    ReplyDelete
  2. Exactly. Reducing both size and the physical number of ticks I would accept as risk coupled with a conservative exit combined with requiring a specific set of circumstances to be present prior to considering a trade made a HUGE difference. Further, I eliminated a lot of external noise, stopped caring what other people think about me or how I trade, stopped trying for the home run everyday and decided YouTube would be my friend during trading hours to help pass the time. (thank you for that suggestion), I'm mostly watching travel videos right now but that will pass and I'll move on to something else.

    I also decided to create a side hustle from this. So I wrote an e-book detailing how I trade, etc. I will actually self publish it sometime in Q2 after cleaning it up a bit but writing the book was immensely fulfilling and really revealed how much random trading I actually did. Even if I never sell a single copy, it was worth the exercise to see how random my behavior actually was. The point of the side hustle was to demonstrate once and for all how a nobody could take up trading and with a few simple rules, make a few ticks a day. As it turns out, it is pretty simple and so I just followed my own advice.

    At some point, I will increase size but for right now, tiny risk combined with a meaningful reward is working. I think it was Ed Seykota that said, "risk only what you can afford to lose and if you win, the reward is meaningful. If either of these two conditions are not present, don't take the trade". I am trying to live by this rule. Risk meaningless amounts for meaningful rewards. Risking ~.125% for ~.50% is enough in my book for right now. If I can do that day in and day out, I can compound my account by enough so the .125% risk is several contracts per trade. Same exercise, different size. That should be the only variable.

    ReplyDelete
  3. Panda,
    I appreciate you taking the time and effort to journal your trading, and then making that effort public.

    Also, I find it very interesting to see Sandy posting on your blog.

    As just a casual, and usually always silent observer of blogs, I have been seeing some similarities between your attitude and Sandy’s regarding trading. At least from what I saw when Sandy had his blogs public, and for a little while private. I don’t mean that comment to be bad in anyway, as I have always assigned value to Sandy’s comments / insights.

    I have been finding the same kind of value in your posts Panda.

    Thank you.

    I will end this post with a quote from Sandy, which I have found very enlightening over the years, and I would like to share. Thank you Sandy.

    “We learn from sharing, because it comes back. One never knows at which moment, which little nugget clicks that makes the wheel turn. That's true of everything in life. So I want to keep the blog public. Unfortunately just as positive energy has a snowball constructive multiplier effect, negative feedback can do the opposite - negative multiplier. Although naysayers can be used as tremendous motivation to disprove them.

    I am at a point in my life where I simply have no patience for naysayers and negative energy. Life is short, and as you get older, the less you tolerate the distractions - because too many things need to explored, achieved, enjoyed.” …..Sandy

    Panda I wish you the best, and I will continue to send positive thoughts and comments your way.

    Shenan

    ReplyDelete
    Replies
    1. Shenan, Thank you for your posts. Yes you will find similarities between my posts and Sandy's. I consider him a friend and mentor and while we don't trade the same, I find his mental approach to the markets worthwhile and important. However the most important thing for me is his humility and lack of superiority when pointing out my faults as others have done. I find that off putting.

      I will take it as compliment that my posts sound similar to his.

      I'm glad you find some value in the blog. I will continue to post as often as I can. These next couple of months may find that diminished somewhat as I try to finish my degree but rest assured, I will at least post a weekly recap if I don't post every day.

      Take care and thanks for the well wishes.

      Delete