Giving up on my dream of trading for a living

[Laissez Faire]

Thanks for sharing. I'm sure we all see some parts of that story in our own trading journey. I also have given up on the "full time trading dream". My issue was and is undercapitalization. I usually start with 10-20k, grow it to close to 4-5x quickly, then blow it. Every, single, fucking time.

Do you have any theories on why this pattern repeats itself? I mean, if you were consistently able to 4-5x your account before blowing it?

Is it due to complacency or were you simply trading extremely high risk initially and finally the risk of ruin/law of averages catches up with you?

Lesson is, automate your strategy, reduce your risk, and live your life.

Being fully automated is ideal for many reasons. If a lower percentage return is inevitable, surely one has to factor in the benefit of not having to spend time at your trading desk on a daily basis.

Curious, though. From what I hear from algorithmic traders there's still a lot of time involved in maintaining the system, improving it, monitoring it, solving new issues that arises, new market conditions and so on.

So, are you still spending less time with your algorithmic trading compared to discretionary manual trading?

 

[rb7]

Do you have any theories on why this pattern repeats itself? I mean, if you were consistently able to 4-5x your account before blowing it?

Is it due to complacency or were you simply trading extremely high risk initially and finally the risk of ruin/law of averages catches up with you?]

I don't want to answer for hilmy, but usually this is poor or nonexistent risk management.
Risk management is as important as picking the right entries/exits.
But most of wannabe traders want to get rich fast and they risk too much until they blow out.

With the same system/model, the outcome/result can be very different (from blowing to very profitable) if the risk management parameters are different.

 

[Businessman]

Ed Seykota once famously said “win or lose, everyone gets what they want out of the markets.” I no longer believe this quote to be true…I really wanted to win in the financial markets, I just was not able to find a way to do so in a way that I could support myself relative to my dwindling bankroll.

When you started out you had no concrete plan on how to make money. So what you got out of the markets, for the last seven years, was the experience of trying out different trading methods.
Hopefully all the experience and opportunity costs were worth it and you have found a method that is viable plus you have developed the discipline and maturity to follow it.

 

[rb7]

Curious, though. From what I hear from algorithmic traders there's still a lot of time involved in maintaining the system, improving it, monitoring it, solving new issues that arises, new market conditions and so on.

So, are you still spending less time with your algorithmic trading compared to discretionary manual trading?

From my own personal experience of automated trading:
Maintaining: When your system has been well thought and developed, there isn't so much maintenance required.
Improving: Well, manual or automated, don't you want to improve all the time?
Solving new issues: Same as 'maintaining', but once in a while it could happened.
New market conditions: Reason for improving

FWIW, my automated system requires manual intervention only once a week, when I need to re-login to IBGw on Monday mornings. And that takes like 30 seconds.

 

[vanzandt]

but then I'll have a few losing days which throw me off balance and which can cascade into a losing streak wanting to make it back quickly to equity highs only compounding my mistakes.

.

You wrote it, you know it, > quit doing it.

 

[NCC1701]

Not sure how old you are but my life had a similar trajectory, I quit trading for a while it turned out fine, now I am back to trading but this time under much less pressure. Hang in there Steve, sounds like you gotta a lot of life ahead of you and you can make good things happen for yourself.

 

[Laissez Faire]

EliteTrader seems like a harsh and unfriendly place a lot of the time, so it's refreshing to see the vast majority of replies to this topic actually being helpful, considerate and with good intentions.

You wrote it, you know it, > quit doing it.

Easier said than done? I'm creating a thread on the subject. Stay tuned if you'd like to chime in.

 

[SteveH]

OP,

You should have focused on the NQ, YM and/or RTY e-mini futures. You can't beat them for consistent volatility in the first few hours of RTH and that's all you ever needed to make a living.

 

[vanzandt]

Easier said than done? )

Definitely. But so is eating to excess, drinking to excess, and smoking cigarettes.
No difference really. Just self-discipline.
Yet look at the annual revenues of companies that feed into those short-comings.
Says a lot about human nature really, and wanting to get it all back at once when you lose some money trading... as human as it gets.

 

[Businessman]

I am wondering if the OP giving up full time trading could be a contrary signal that the (stock) markets are about to get volatile within the next few months.
And if so, i hope the OP will catch some of that action if he continues to trade on the side.

First six months of last year were great, the last eight months have been ok, but not nearly as good.