2011: Rebuilding My Battered Account

[jedwards]

Quote from scorpion:

What Real Trader can lose over 100k in 1 month & still continue to work a full time job . that is a red flag.. real traders would not trade the way he does with real money? If someone earns 25 k in 1 week. Why work a full time job? Any real trader is going to devote all your attention to trading full time it's their livelihood.. easy to do if your using monopoly money. He is in fantasy land with this journal. always good for a laugh

For what it's worth, I have a co-worker that trades a great deal. He makes on average about 2-3k/day, and has made 30k+ on some single trades. He, of course, has some large losses as well, but makes a lot more than he loses day trading, sometimes while at work. I've watched him trade with my own eyes so I know this to be true.

We asked him the same question, why he doesn't just quit, and he said that it was boring to sit around all day and watch the markets. He will keep an eye on the markets, but the responsibility to do work that drags him away from the markets gives him the ability to step back and get perspective. It keeps him from overtrading, and gives him something else to think about besides just watching ticks day-in-and-day-out.

As to neke, I've looked back to verify the trades that he's posted, and they all seem legit, so I believe he is telling the truth. He has been consistent logging both his great weeks and his bad weeks, and doesn't really engage the people who respond to his blog, so there really isn't much to gain from making this all up.

 

[newguy05]

Quote from nonlinear5:

This is like watching a zombie movie, or hearing a story of someone encountering a real zombie -- it's good for entertainment, but you are not going to become a good zombie fighter after watching a movie or hearing a story.

Speak for yourself, after watching zombieland i consider myself an expert zombie killa!

 

[oraclewizard77]

This is the dumbest post here. There was a previous post that was right on the money.

A trader is not a fighter in the ring. It would have been better to either set a target and stop and go away, or go away before putting another 50 contracts on the line.

If I could punch someone and make money I would. Instead I know that the market is right and stronger than me, and I look for clues on where it wants to head before it gets there.

Quote from Red_Ink_inc:

Surprised that in all the pages of commentary no one commented on this.....

"Cancelled the order and went away"? Are you serious? If you were a boxer your corner man would have thrown in the towel long ago. You're not even defending yourself. Just standing there taking punches until your face hits the canvas.

"Why I haven't stopped I am not sure."

I know why, as does everyone else.

 

[Roark]

Actually, I thought that post was of the most insightful. It's time for Neke to hang it up and trade with a simulation account until he starts showing consistent profitably.

 

[illiquid]

What I'm wondering is: how does neke trade with such abandon, throwing caution to the wind on so many occasions -- and yet has never held any position overnight? From what I see he is almost always long options, so I don't believe margin is an issue here.

To be so reckless at times in averaging down against the grain, and yet simultaneously having the discipline to always exit by the close -- it's a little odd, don't you think? He's not trading at a prop firm, he doesn't have a gun to his head at the bell. He's got this near impossible goal he's been struggling with all year, combined with a gambler's taste for risk -- wouldn't he have taken at least one shot overnight by now? I know I would have

 

[john12]

noji talks a good game . A 5-3 coach can be a good coach and not play a lick of ball. As i recall noji was making $200-$600 a day a year or so again. She's always giving advice so i think we need to see her 5-10k a day p@l's.

 

[Millionaire]

I think neke has hit a wall in his trading, his account may have grown to a point where he is psychologically effected by the size of his draw down in dollar terms.

Consider a draw down from $5000 to $2500.

Or from $50000 to $25000.

Neither of those draw downs will effect a trader like Neke.

However a draw down in the 100's of K is a different issue, especially one that lasts months and months.

I think Neke should forget about compounding and concentrate on taking 10K a month (average) out of the market, and take it out of his account when he makes it, after he has hit that goal for several months he might consider making and taking out more.

 

[NoDoji]

Quote from john12:

noji talks a good game . A 5-3 coach can be a good coach and not play a lick of ball. As i recall noji was making $200-$600 a day a year or so again. She's always giving advice so i think we need to see her 5-10k a day p@l's.

What do you think would be of more benefit to a struggling trader, John? If I posted a daily P/L of $5-$10K, or if I took information based on three years of full time day trading experience that can help a trader net a daily P/L of $5-$10K and handed it to everyone here on a silver platter?

Lescor generates an annual profit of a million dollars or close to it trading a 100K account, allegedly confirmed by fellow traders at the prop firm he trades with. Did reading Lescor's thread help me improve my trading in any way whatsoever? No.

I have no clue if Al Brooks has ever traded. Did reading his book help take me from "confused" to "consistently profitable"? Yes.

 

[neke]

Quote from illiquid:

What I'm wondering is: how does neke trade with such abandon, throwing caution to the wind on so many occasions -- and yet has never held any position overnight? From what I see he is almost always long options, so I don't believe margin is an issue here.

I do not have any instinct to carry anything overnight, in spite of sometimes seeing such positions could have worked in my favor. The peace of mind that comes from knowing I am not sweating over what might happen overnight is important. At the end of the day I can walk home to my wife and two kids, and not have to wake up in the night with nightmare of what might happen. Whatever happened during the day, I accept by the end thereof. Yes, I have said I might incorporate more swing strategies but have not had the will to implement that. Maybe with an expected new found discipline when my new automated/mechanical combo goes into effect tomorrow, I might give more thought to longer time frames. Like I said I might end up having only about 60 discretionary trades the rest of the year (about 120 trading days). That works out to a trade every couple of days. A typical distribution of the number of trades per day could be below: (did some probability simulation).

Number of Trades
For the Day			Number of Days
0				76
1				31
2				10
3				 3
				------
Total				120
				------

With an expected 76 idle days, it is quite possible to go a week without a discretionary trade. That is where my discipline is going to be tested. But I believe I will get used to it. There is a provision for an 'experimental' size to be allowed for trades that fall outside the automated/mechanical parameter: those would be about 20% of the regular size, which at the moment might mean a stock purchase of just $22K worth - not much to worry about the potential gain/loss. That is the plan. Now let's see how it goes from tomorrow.

 

[Roark]

I think there is something you need to admit. You have a problem. You are an addict. Each morning before you start trading you need to have an anonymous losers meeting for one. You have severely damaged your account. Unless you put together a solid plan and stick to it you will do further severe damage to your account. Rule number one of your plan should be never add to a losing position.