2011: Rebuilding My Battered Account

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Quote from neke:

Weekly Update for week 39/50 ended 10/07/2011


Bad week, down 6.7K (3.8%). Painful to report another low in equity. Took too many long mechanical trades on Monday, beyond the number of trades limit my automation should have taken and lost on a lot of them. Couldn't make that up the rest of the week.


Code: 
Opening Balance:                	176,073
Net loss for the week 		          6,713
-------------------------------------------------
Net Balance:                   		169,360


Since Inception of Thread   01/8/2011 - 10/07/2011

Opening Balance:                   	335,899
Net loss (Less Margin Interest)		166,539 (Down 49.6%)
------------------------------------------------
Net Balance				169,360
More...

hi neke

Bad week, down 6.7K (3.8%)..... SO WHAT ARE YOU GONNA DO ABOUT IT TO MAKE IT A DIFFERENT OUTCOME FOR YOURSELF, PLS....?

Painful to report another low in equity. YES, MANY HERE WERE ONCE UPON A TIME IN THE SAME EXACT BOAT.... always painful to experience losses....

and my humble repeated question to you, neke, is....

WHAT ARE YOU GONNA DO ABOUT IT TO MAKE A DIFFERENCE, PLS?

WE are all empathetic with you, with you pain and with your continuous losses....

but you are the captain of your ship, what are you gonna do about it, pls?

you were at the apex once not too long ago and you know exactly how it felt to be on top.... right?

do something that you know how and that you knew best that led you to the apex before....

again, only you, neke, and you alone.... who can turn things around in your favor..... and we all are cheering for that day to come soon.... K?
 
Quote from neke:

Weekly Update for week 39/50 ended 10/07/2011


Bad week, down 6.7K (3.8%). Painful to report another low in equity. Took too many long mechanical trades on Monday, beyond the number of trades limit my automation should have taken and lost on a lot of them. Couldn't make that up the rest of the week.


Code: 
Opening Balance:                	176,073
Net loss for the week 		          6,713
-------------------------------------------------
Net Balance:                   		169,360


Since Inception of Thread   01/8/2011 - 10/07/2011

Opening Balance:                   	335,899
Net loss (Less Margin Interest)		166,539 (Down 49.6%)
------------------------------------------------
Net Balance				169,360
More...

Half? And, you know, if you were to endure another 50% drawdown would most likely another be 75% so if you could hold it to 65% drawdowns in 25% simulated runs you'd be able to recover if your system ever displayed returns on account in excess of 10 million percent?
 
hi neke,

tough to see someone go through a drawdown like this. experienced a 50% drawdown once in 2008, but was luckily able to make that back in 2 months after the drawdown. learned to control my losses since.

but, you have to be in your A game to make that back. do your strategies/edges still work? if not, then a viable way to recovery would be difficult. try to learn as much as you can from your mistakes. clearly you have to adjust what you are doing.

a fellow trader once said "Focus on your set-ups that have the highest probability of success and master it."

i myself have had a string of losing months recently, but seemed to have finally gotten back to the flow of things this month. had my best week since march this week.

good luck.

mgarc





Quote from neke:

Weekly Update for week 39/50 ended 10/07/2011


Bad week, down 6.7K (3.8%). Painful to report another low in equity. Took too many long mechanical trades on Monday, beyond the number of trades limit my automation should have taken and lost on a lot of them. Couldn't make that up the rest of the week.


Code: 
Opening Balance:                	176,073
Net loss for the week 		          6,713
-------------------------------------------------
Net Balance:                   		169,360


Since Inception of Thread   01/8/2011 - 10/07/2011

Opening Balance:                   	335,899
Net loss (Less Margin Interest)		166,539 (Down 49.6%)
------------------------------------------------
Net Balance				169,360
More...
 
i dont trade stocks/options so i cant give so much advice in that regard. But your down 50% man.You need to stop trading. Take out some money in cash 100, 1000, 5000, hell 25k etc. and put it on your desk/ night stand. Some where you can see it everyday while you go through neutral. Hopefully you will actually see that it is real cash you are burning not just numbers on a screen. You have had success but you have not adapted whats so ever to current conditions. Go back to the drawing board, dont think falling sub 100k is impossible that some how you are invincible. Secondly order the book when super traders meet kryptonite. Its a book compiled on dozens of traders who went bust with accounts MUCH larger than yours. Bust=$0 USD. You have to learn a lesson when you lose money. I hope 50 percent was your lesson. GL
 
This thread is a constant reminder why I avoid draw-downs like the plague. Whenever I have a losing streak it's usually because the market is not conducive to my strategy. I'm a long only swing trader and this year has been dismal. I am down just over 4% YTD. At my peak, I was up 15%. My worst drawdown was 12%. I close shop if I ever draw down 20%. The drag from a large draw down is exponentially harder to overcome the bigger it gets.

And then when you're in that huge drawdown, you'll think to yourself that you were better off not trading at all! The market is heartless, and I never trust anything when it comes to the market.
 
The number one problem (out of many) is that Neke has no defined risk management system in place.... none whatsoever. He has proven he cannot limit his losses.

Furthermore it is clear with his discretionary trading that on more than one occasion he has been on full tilt. Disciplined? Please....

These reasons alone will prove to be the ultimate catalysts for Neke's downfall... unless he does something to address these issues immediately.

Strategies that work or don't work are secondary and frankly moot at this point.
 
I find myself agreeing a lot with most of the above posters, it's obvious that something egregiously bad is happening here.
Although I disagree that getting more emotional regarding the loss is the answer (as CollegeTrader mentioned regarding visualising the money). In a very unemotional and objective way something very bad is happening here.
Even if you go on to double the size of your starting account now you have to realise that any system that allows you to weather a 50% draw down has got to be bad, and goes against the old 'protect your capital' rule.
Given the recklessness I'm still trying to figure out if the situation is one of three things 1) this is a paper trading account and this is some kind of hobby (therefore there's no real emotional component to it) 2) this is real account for neke representing a significant amount of his capital and he's revenge trading/gambling to avenge for previous losses (both capital and egotistical) or 3) neke is some kind of multimillionaire and this is play money (poker account) and that losses don't really matter so much.
While theres never really a sure thing, these kinds of losses come from betting the ranch on a hunch type approach.
I think if you want to grow this account you have to play a lot more defensively, only using 10-20% capital max for derivitive plays and doing boring old fashioned stocks, ETFs etc with the rest with minimal/no leverage.
 
Dear Neke,

It seems as though you have a string of good pieces of advice in this thread from our ET friends, who all happen to be serious and competent traders.

You need to stop trading today and take a break, take a shower, then outline plans for coming up with new strategies and read a book or two. Even more effective, check out all of the FREE information on the web. Although we were all losers in the beginning, day trading is NOT difficult. If you can't make a gain, then just GUESS and cut losses fast! Follow the ES Journal thread, copy what everybody else is doing, have tight stops, and let your good bets/guesses run. On a bull day, be inclined to go long on dips and be even more briefly short on rips. What is so difficult about this?

12 trades this week? Is your margin account not working properly? Are you throwing darts at the S&P heat map and buying which ones they land on? You should be making more frequent trades with tighter stops when you lose gains, to be more conservative.

Insanity is repeating the same thing over and over expecting a different outcome. Bottom line: if you keep whatever you are doing (including panicking by going to other strategies), your account will go from $175k to $125k to $75k to $40k to $3k.

Also consider going to a different broker. The time it would take to do that (couple of days - one week) would be enough time to get yourself together and would be a good new foundation for getting back to seven+ figures.

I know we only talk over the internet via text, but my God, you WILL lose all of your money forever if you don't follow my and our suggestions. I'm glad we all can call each other friends, and enjoy reading your chronicles. Now get off the computer and get on the path to gains! :):eek:
 
Hey, on the positive side, he isn't yet 50% down!! So it's not that bad!!!

It's options trading, a few really good trades and he's back on track.
 
Quote from traderslair:

Hey, on the positive side, he isn't yet 50% down!! So it's not that bad!!!
More...

His draw down figure is YTD, not from his 2009 peak equity, which is sadly much more than 50%.

Quote from traderslair:
It's options trading, a few really good trades and he's back on track.
More...

I think that is what got him to this point.
Going in heavy, works great when your account has already been going up.. not so well when you are on the down slope.
 
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