Another one hangs it up

Quote from Broken dreams:

Adaptation is a very obvious solution, and that's not wisdom but common sense. But it's really easier said than done. To consistently be able to predict and figure the market out every time for a long period is an extraordinary feat that few get ot achieve. One may be able to do it for a few years, or even more than five years. But the probabilities of being able to do it over an extended duration just aren't in favor of anyone in this uneven game where there's always hidden yet vital information that aren't for public access.



I agree. I'm scared of the idea of having to adapt on my own. Makes the idea of remote trading very daunting.

But you cashed in for 5 years. I'd think that a market environment would return that favors your edge. (some edges are all gimmicks like the stuff I did at HLV. The other day I heard they might allow nxing the entire bid/offer, not just up to 1099. Wonder what that'll do for some nyse scalpers.)

But if a market/your edge returns, you'll cash in! (guy in the office works for a think tank and only trades the open with a program he made. Dunno what he makes. But if its an extra 40k a year, thats still an awful good skill to have.)
 
newguy,

Well, you obviously have much higher exposure to competitive tennis than I, but I just used that sport as an example. But my point was really just that in most activities, if you try hard, stay committed, put your work into it, you're pretty much going to see productive results or some kind of progress. The muscle memory and reflexes that an athlete acquires during practice or in scrimmages should probably help him in real competition. Sure, there's still a mental aspect to all sports like dealing with pressure, but once technical skill levels are acquired, they're generally pretty consistent.

Having a proper mindset may be a strong factor in tennis, but I'm not sure if it really applies to trading. It's not like profits will start rolling in if I get fired up in the bathroom, stare in the mirror, give myself a Lombardi pep talk, and say to myself, "You go get 'em, Tiger! You're the man today! You can do it! Believe in yourself! And money will come." =)

A certain mentality is obviously needed for most athletes. The mental drive might inspire a basketball player to fight through pain, grab offensive rebounds, play hard defense, dive for lose balls, or whatever, but I don't really see how that sense of motivation or mental strength carries over to trading since, at the end, you really do need a strategy that works to make your money. It doesn't really matter what's in my head if the system is failing.

As for SATs or any kind of academic work, there's usually a formula to achieve success. One basically has to study, memorize a bunch of words we never use, go over materials, and one should be better prepared. It's something that should guarantee some progress if one is dedicated to the process of learning.

But is that also how it works in trading? I think you probably know my answer by now.

Having right strategies is really what helps people make money, and having the ability to know when to switch to new methods is what keeps them in the game. But how long can they realistically keep on doing that? For me, I guess it's about five years. Does that mean it's not possible to do it longer than that and have lasting careers? Of course not. When I bring up the odds, it's not used to suggest that you or anyone cannot do it; it's merely used to indicate that only a tiny fraction probably ever will. But you don't really have to look at numbers. Just observe around and see who's really made it, then wonder how come there are so few. I did that and then finally realized I was in the wrong business.
 
Quote from Broken dreams:

[Having a proper mindset may be a strong factor in tennis, but I'm not sure if it really applies to trading. It's not like profits will start rolling in if I get fired up in the bathroom, stare in the mirror, give myself a Lombardi pep talk, and say to myself, "You go get 'em, Tiger! You're the man today! You can do it! Believe in yourself! And money will come."

I agree with everything you said except this. Like I said before, in football all you had to do was try. Probably same for track.

But the point with tennis is that it just isn't enough. Theres something else going on in your head apart from nerves/strategy that requires some feel...and its obvious by now that technical skills (physical abilities/strokes) aren't enough. (think johnny mac...worst technicals, phenomenal tennis ability)

I just like the one example you gave above, because its exactly what doesn't work in tennis, but works in just about every other sport i've played. You don't really get an A for effort in tennis.

But thats just side chat. (on a different side note, I talked to the manager at altea trading 15 months ago, and he said his best traders were amatuer golfers and tennis players. Good trader in the office (8 years) is also a tennis guy. Theres a saying that all tennis players are crazy/mental. I've heard that about traders once or twice. Must be all the stress/torment any activity that focuses soley on individual performance places on someone.

Good luck, and good health!
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Quote from FuriousInvestor:


I do have a two questions to ask you if you don't mind.

Why exactly did you fail at trading? (was it money management, was it your system, etc)

What is your method/style of trading?

.
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FuriousInvestor, my biggest failure was my inability to keep on finding systems to keep up with the market. Strategies don't last forever. If you have good methods right now, savor them, enjoy them, and don't take them for granted.

Oh, things like money management, discipline, etc. really stop being an issue after you have already learned them. I never stayed up at night worrying about how big of a risk I had put on. I usually stayed up worrying if my edge even existed or if it was going to continue to work.

As for methods and styles, they were relatively conservative. You can pm me if you really want to know. It's not like they work too well anymore anyway.
 
Trade strategies based on sound principles such as Market Profile and Auction Market Theory do continue to work because they adapt to the changing markets (i.e., it’s the way markets work). In general, most traders start and end with trade setups and never learn how the markets work, who the players are, and what the players are doing in the market. Trade setups are such a small piece of this game. Most traders trade the same way whether the market is in a trading range or in a trend! Using trading models based on AMT is not too popular because it takes time to learn and requires people to think, as opposed to following a “wiggle” of an indicator using a mechanical system. In addition, these strategies are followed by too many traders who are all trying to get in and out of markets at the same time. A lot traders use market information that is obvious to everyone else. Since this is what everyone else is doing, it makes sense to me that most fail.

It is also important to diversify and follow several markets, because every market runs into a dry spell where there is not much profit potential or trading opportunities (i.e., low volatility/daily range). For example, the average true range of the S&P is a third of what it was a few years ago, but still very tradable. Actually, the S&P has been great for day trading lately. But I do think it would be extremely difficult to trade for living by following a single market.

Just my 2 cents. Back to lurker mode.
 
Well, HispaTrader, you seem to have figured this thing out pretty well.

What do you plan to do when your strategies based on Market Profile and Auction Market Theory stop working?

Do you think UVA and LVA will always be reliable? Do you trust POC is that important? Do you think you've found the magical secret to trading in Support and Resistance? No trader's ever looked into that breakthrough stuff before.

Or a better question - do you even know anyone who has been successful for ten years (not only a short string of months) and ready to retire from trading on soley principles based on Market Profile and Auction Market Theory?

Just asking because you seem to have this trading thing all figured out. Feel free to share your gifted knowledge and teach everyone how easy the game is to you. So how do the markets work?

=)
 
they work this way: sentiment (as in real money flow, not retail, they are the last to react) changes direction - be it because of news or the lack of them, in which case, based on technicals, actualized risk assessments etc - often enough. as long as i manage to detect or even better 'anticipate' those changes and act upon this fast enough and be right often enough, i have a business... if not, leave me yr number and perhaps we'll catch up for drinkies someday...
 
Quote from Cheese:

You've got yourself completely f**ked up the butt from a trading life that is not for you.

Relax.

Take it easy. Check if you have any arms or legs missing. Yup, all intact. OK, nothing is seriously wrong.

Here comes your biggest opportunity ever.

Rethink your whole life. Take a break. Go do a humdrum job somewhere else in the country until you work out a new compass for yourself.
:)
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This is really good advise.
I spent four years as a broker and was completely burned out. I just got to a point where I couldn't pick up the phone anymore. A friend on mine who managed a tennis proshop at a local resort hotel, suggested I come work there whilst I got my head together. Next day I walked into the office, said "cheers" to all the guys, got a pat on the back from the boss and when to the shop. So at 27 years old, I spent the next 18 months working, meeting people and playing all the free tennis I wanted. Frankly it was one of the best times of my life and it gave me time to sort out my head.
 
Quote from Broken dreams:


Do you think UVA and LVA will always be reliable? Do you trust POC is that important? Do you think you've found the magical secret to trading in Support and Resistance? No trader's ever looked into that breakthrough stuff before.

Just asking because you seem to have this trading thing all figured out. Feel free to share your gifted knowledge and teach everyone how easy the game is to you. So how do the markets work?

=)
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I'll voice my opinion.
Support and resistance is almost never used in my system.
Trading is a continuous process. You're always learning, always evolving... The most important thing is to limit your risk and exposure. That way, you'll know when your system doesn't seem to work anymore, and will further whilttle down on the positions.
If I traded now like I did when I first started, I'll prolly be broke a few times over. Luckily I added risk management and don't lose too much when I am wrong and am stopped out. (A gap down of 20% won't hurt me too much in most cases... other that short term trades ;))
I base my system on fundamentals, technicals, intermarket, sentiment and macroeconomic analysis(I always do my own macro analysis... the news is usually reversed and used as contrarian stuff) I limit most positions' risk to 2-3% of portfolio, maybe less on trades I'm not confident in. I've bet 5% of equity on some trades I was really sure of though. Never really bet the house...
What can I say? My system is very simple(I actually have a few in mind, but this refers to my main one), probably takes a few weeks of reading to understand and grasp(It did take over a year to form after reading dozens of books and losing money and making money and so on). Is it working? For now, yes. Will it continue working? I have no idea. But since human nature never changes, I expect that I won't do too poorly trading my system.
But then again, I've never reallly thought of getting really rich trading only with my own money, since I know that's quite improbable. Lower expectations, lower risk, less gambler attitudes and trades and more consistency(I hope) And I don't trade for a living :)
I also believe a positive winning attitude and other psychological/mental/discipline aspects are more important when it comes to trading. Entry systems? Just have one that makes sense and has a positive expectancy with risk under control and exposure limited. Heh,I don't consider myself a trader, prolly won't do much daytrading later on in life either. The profits from daytrading are limited in relation to risk. In fact, that's the same for any short term strategy. The profits from an intermediate term/long term trading plan may be unlimited(think HANS...) If things go very bad and my system goes haywire I do have fundamental investing in bear markets to fall back on :cool:
 
Quote from Broken dreams:

...In sports, it's much easier to locate specific areas that need improvement (perhaps it's serving, volleying, returning, conditioning, footwork, etc.) Every player or coach can evaulate a game and pinpoint where to correct the errors. If one is fully commited on this improvement, one should at least be able to see some continual progress.

But in trading, after the learning stages of figuring out and even mastering all the fundamental skills (discipline, money management, risk management, etc.), the road to continual improvement is uncertain because trading involves so much more ambiguities. How does one work on something when one doesn't even know what needs to be improved on other than that he just needs to have a better system to stay in the game?

If a tennis player's backhand is weak, he can easily pop some balls, be out under the sun or in the rain, and work many hours on that. If his serve is a little bit weak, he can work on that as well. If he has stamina issues, there are programs to improve that. The focus of weak areas are known. A player can know exactly where to attack to get better.

But in trading, after a certain point, that process for improvement is much harder to identify. It's not like one can improve on disicpline when discipline wasn't the cause of money loss. And it's not like one can work on better management when things like that weren't the issue neither.

When a trader starts losing money due to simply having used a strategic method that has stopped working or has lost its probabilisitic edge, it's a much more complex problem to solve.

Sometimes, no amount of hard work, practice, dedication, or experience will guarantee that a trader can fix that or rediscover new edges because the markets are always changing, and one has to always have the knowledge of knowing what methods are applicable to current and future conditions.

Adaptation is a very obvious solution, and that's not wisdom but common sense. But it's really easier said than done. To consistently be able to predict and figure the market out every time for a long period is an extraordinary feat that few get ot achieve. One may be able to do it for a few years, or even more than five years. But the probabilities of being able to do it over an extended duration just aren't in favor of anyone in this uneven game where there's always hidden yet vital information that aren't for public access. Working hard, having passion, being driven relentlessly, and being fully dedicated to achievement are things that one can do or have to improve in sports or in most endeavors. But unfortunately, that's just not the case in trading. Or else probably more than a fraction of a fraction of 1% would be able to succeed in it at the end.
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First of all, if you've done trading...

I recommend you stop hanging out at trading forums unless this is a way for you to eventually let go (your in the final stages of moving on to better things).

In addition, I almost disagree with everything you've said in your comparison with Sports versus Trading.

Mainly because I've played sports on an international level and know a few other traders that have played at a top level on the collegiate level or Jr. national level.

Also, when you asked this question (rhetorical)...

How does one work on something when one doesn't even know what needs to be improved on other than that he just needs to have a better system to stay in the game?
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Anyone unable to answer that themselves are approacing trading in a way they will never be able to adapt when the market changes...

A market that's always changing.

Regardless, thanks for sharing your story and giving us a look into how some traders interact with the markets.

Hopefully, someone is reading your words very carefully.

Thus, now its time for you to move on and I wish you the best because trading is not for everyone...

Just like any sport.

Last of all, someone made the following comment and is completely wrong...

Quote from newguy1:

Theres no burnout in football...

Football players are never good at tennis...
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http://en.wikipedia.org/wiki/Arthur_Ashe

I've met a few good tennis players (never met Arthur Ashe...I was just a small kid) and I lived next door to one while in college...

A few of them were darn good football players and were either captain of their football team or help lead the team to a state championship.

In fact, most star athletes I've ever met have also starred in other sports...

Tennis is no different.

Also, I've met a lot of football players that just burn out from the sport (high school, collegiate and professional)...

Guys that just suddenly one day shut down...walk away drained with very little warning regardless to the position they played.

To see a star athlete break down mentally...

It's something you never forget.

Mark
 
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