Losing days

[wrbtrader]

So far this year i have had 2 losing months.

Feb: -1800 GBP (-2300 USD)
May: -19000 GBP (-25000 USD)

Ok...so January, March, April and June are your profitable trading months even though you're only discussing your losing days and losing months.

The issue that's a little confusing (maybe not for you) is that you're only discussing your losing days even though the month itself may be profitable.

What happen in May although you do not provide any details about the losing days beyond just saying it was a losing day and its loss number ?

I don't expect you to answer that considering you have only mentioned that the day was a loss w/ number.

Reality, this is just a one sided journal because you've removed the critical elements from any typical journal discussions although privately you know exactly the statistics of each of your specific trades.

Oddly, although you're only willing to discuss the number of a losing day and the number of a losing month...you're not willing to discuss specific losing trades on a trade day that has resulted in profit or loss.

Essentially you're maintaining two different journals. To me...that will open the door to a confused performance in your head in which you will "react" differently and then be force to review your entire performance...privately to see the big picture. Simply, privately you have the entire picture whereas publicly your only showing a part of that picture.

Maybe that's intentional by you. Your journal is a mental game to you or your journal is just some sort'uv of twisted mental exercise you're trying to get others (the readers) to participate in for your pleasure.

This kind'uv reminds me of the day my girlfriend fell in the pool with all of her clothes on while trying to clean it. She got soak n wet from head to toe but only complained about her shirt getting wet.

 

[Millionaire]

Oddly, although you're only willing to discuss the number of a losing day and the number of a losing month...you're not willing to discuss specific losing trades on a trade day that has resulted in profit or loss.

The profitable trade entries are the same as the losing ones.
There is no difference in the entry and setup for the trades.
Obviously some trades get stopped for a loss. But the market decides if a trade will be stopped out or not.

My trading is completely quantitative and also fully automated so i don't want to give away the edges which i have developed over the last 15 years of very hard work. That is why i do not go into trade specifics. Im sorry if it is annoying for readers.

This journal is probably more beneficial to me, although i still think newbie traders can benefit by seeing how a disciplined trader is able to take losing days without losing emotions.

I started this journal in May and to date i have not had any emotional issues or lack of discipline in my trading eg jumping signals or taking profits early..

Although to be honest the market has not really tested me. The largest drawdown since i started this journal has only been one third the size of the largest drawdown ever seen in my back test results. In theory there is no reason why you cant get a bigger drawdown in live trading compared to what you saw in the back test. And that is the time when traders really get tested.

 

[wrbtrader]

...My trading is completely quantitative and also fully automated so i don't want to give away the edges which i have developed over the last 15 years of very hard work. That is why i do not go into trade specifics. Im sorry if it is annoying for readers...

Thanks for the clarification and apology not needed.

Now that I know this is really a partial journal (the losing side) involving an automated trading system.

Yet, I still don't understand how discussing specific losing trades will or can possibly reveal your automated trading system or your edge.

In addition, you think doing such can benefit newbies without mentioning until now that you're using an automated trading system. Yet, you did mention a few specific metrics in this journal.

You mentioned that you're trading 10 - 30 Emini contracts.

Out of curiosity, do you think the typical newbie trader is trading via 10 - 30 Emini contracts ?

Another metric mentioned today is that this is an automated trading system. Yet, you did use the words "trading system" in prior messages but I've seen discretionary traders use the same words in their description on their trade strategy here in the journal threads after someone ask them is it an automated trading system.

Do you think the typical newbie trader is automated or eventually will become automated ?

The thing that confused me was the fact that you've described your emotions via using words like the below...

I have been doing well so far, trading my plan without any errors or negative emotions (fear, anger etc), i think this journal is helping me do this.

If i start failing at executing my trading plan 100% flawlessly, i will mention the issues i am having.

Maybe its me but the typical discretionary trader talks like that. They use words like their "trading plan", "trading without errors", "negative emotions" (fear, anger etc).

That leads me to my next question. It doesn't seem like you're using a completely automated trading system. Thus, some aspects of your trading system is automated and other aspects are not ?

Simply, you can not walk away from your automated trading system and let it work on its own after you connect it to your broker trade execution platform. Therefore, you're either manually entering trades or manually exiting trades or manually managing a trade after entry.

I know I'm being picky but you actually don't even discuss each losing trading day on the day they occur except only in your losing day summary list of numbers without mentioning the date. Thus, some listed losing days...were not even discussed in the journal since you've started this "journal".

In fact, you don't even mention your emotions on specific losing trading days or level of errors except for one particular day although the quote above implies these issues are important to you. Then you stated you will mention the issues if you fail at executing your trading plan 100% flawlessly...

The latter is clearly discretionary talking. Thus, another indication you're not using an automated trading system but some parts of it are automated due to the fact you have now stated its "automated".

Last two questions...have you viewed ETs automated trading threads here at the forum ?

https://www.elitetrader.com/et/forums/automated-trading.48/

When i trade 30 lots my Stop loss is 3 times closer than compared to when i trade 10 lots. This means the $ risk is the same for both trades.

My losing days vary widely in dollars, this is because i can get between 1,2 or 3 signals per day. And for each trade i scale in my entries...

I'm a discretionary trader that puts a ton of emphasis on position size management. I strongly doubt that your number of trades in a particular trading day is the reason why your losing days vary widely in dollars...

Reality, its the difference in position size when comparing one trading day to another trading day that's the reason for the variance in your daily profits/loss results not the number of trade signals.

Another variable is different stop placements from trade to trade or day to day. Yet, we can keep going...different profit targets will also have impact.

However, lets pretend you really believe the number of trade signals in a day is the reason for the variance in your losing trading day numbers.

Why not mention for each losing day the number of trades ?

Surely, you don't think that doing such will reveal your edge.

 

[Millionaire]

Yet, I still don't understand how discussing specific losing trades will or can possibly reveal your automated trading system or your edge.

Actually i dont even want to mention which markets i trade. As even the balance of markets i trade is part of my edge.

Out of curiosity, do you think the typical newbie trader is trading via 10 - 30 Emini contracts ?

Of course not, i would expect between 1 and 5 lots for a newbie. Livermore suggested scaling in with 20% on each scale in. So a newbie might want to start with 5 lots if they plan to trade that way.

Another metric mentioned today is that this is an automated trading system. Yet, you did use the words "trading system" in prior messages but I've seen discretionary traders use the same words in their description on their trade strategy here in the journal threads after someone ask them is it an automated trading system.

Do you think the typical newbie trader is automated or eventually will become automated ?

The thing that confused me was the fact that you've described your emotions via using words like the below...

Maybe its me but the typical discretionary trader talks like that. They use words like their "trading plan", "trading without errors", "negative emotions" (fear, anger etc).

That leads me to my next question. It doesn't seem like you're using a completely automated trading system. Thus, some aspects of your trading system is automated and other aspects are not ?

Simply, you can not walk away from your automated trading system and let it work on its own after you connect it to your broker trade execution platform. Therefore, you're either manually entering trades or manually exiting trades or manually managing a trade after entry.

All trading involves emotions, automated trading does as well.

I like to use high leverage, that means i use about 4% position sizing risk. If i risked 0.5% then emotions would have less of an effect.

So if i have a 15R drawdown at 4% risk then i have lost 50% of my account. That will trigger emotions.

A big emotional temptation is say the biggest drawdown in the back test was 15R and you get a 20R drawdown in real trading. There will be a temptation to turn the system off until it becomes profitable again. But you could end up missing a massive winner if you do that.

Also you cannot walk away from an automated trading system. Some monitoring is always required.

Orders can sometimes fail to go live because of:

1) Software errors in my own code.
2) Hardware failures/electric outages.
3) Connection errors between you and the broker.
4) Connection errors between the broker and the exchange.
5) Exchange outages. (Less common these days).
6) Software errors in your brokers latest software update (has happened twice to me in the last 15 years).
...

So while monitoring the orders sometimes you see a big quick windfall profit on your existing positions.
If you have been giving back big profits often in the last few trades there might be a temptation to book todays profits manually. I rarely make this error, but it is alway an emotional temptation especially if you have a very strong feeling the market is going to retrace and wipe out your paper profits.

I know I'm being picky but you actually don't even discuss each losing trading day on the day they occur except only in your losing day summary list of numbers without mentioning the date. Thus, some listed losing days...were not even discussed in the journal since you've started this "journal".

Since i started this Journal. All losing days have been mentioned on the date they occurred, or if i posted a day late i have said the losing day happened on the previous day.

In fact, you don't even mention your emotions on specific losing trading days or level of errors except for one particular day although the quote above implies these issues are important to you. Then you stated you will mention the issues if you fail at executing your trading plan 100% flawlessly...

As mentioned in my previous post, i have been trading well (not showing much in the way of emotions) and taking losses in my stride because i have not suffered a large drawdown since starting this journal.

The latter is clearly discretionary talking. Thus, another indication you're not using an automated trading system but some parts of it are automated due to the fact you have now stated its "automated".

Automated traders can fail to execute their plan flawlessly.
Turning a system off during a big drawdown or perhaps overriding and reducing position size.
Also there is always the temptation to modify a system on the basis you are making it better, when in reality you are making it worse eg. Lets say you have been trading EUR/USD and it has been slow over the last six months and generated lots of losing trades but GBP/USD has been having amazing moves. So you might switch the automated trading system to GBP. What happens is that original market has its biggest winner of the year just after you switch!
Then there are things like being very tired and oversleeping or just getting distracted. You wake up and see that your system failed to send orders automatically because of one of the error condition listed above. And you find you missed a big winning trade.

All emotional issues become heightened when you trade large size even with an automated system.

I'm a discretionary trader that puts a ton of emphasis on position size management. I strongly doubt that your number of trades in a particular trading day is the reason why your losing days vary widely in dollars...

Reality, its the difference in position size when comparing one trading day to another trading day that's the reason for the variance in your daily profits/loss results not the number of trade signals.

Another variable is different stop placements from trade to trade or day to day. Yet, we can keep going...different profit targets will also have impact.

You are correct, many factors go into the size of a losing day.
But the total (largest) risk for the day is to assume every trade will be maximum sized loser.
So if i take 3 trades and they all lose the full amount ie 4%. I will lose 12%.
If i take only one trade at 4% risk i can only lose at most 4% that day.
I am always thinking about the worst case for each day.

 

[Millionaire]

Lost -5353 GBP (-7000USD) today

List of losing days for this year (organised as losing day streaks):

-5530
-3130
-756
-4379
-265
-2732
-4187

-2058
-4974
-103

-2807
-2766
-3243
-4107
-3778

-5209

-3513

-8699
-4668

-4920
-1842
-1988
-3402

-7001

-3063

-3710
-1787
-5353

Currently losing day streak is 3
Current drawdown is 18000GBP from high watermark made in May

 

[Millionaire]

Lost -3560 GBP (-4500 USD) Today

Currently losing streak is 4 days
Current drawdown is 21500GBP from high watermark made in May

 

[Millionaire]

Lost -2187 GBP (-2800 USD) Today.

Current losing streak is 5 days
Current drawdown is 23,750GBP (30,000 USD) from high watermark made in May

 

[Overnight]

Lost -2187 GBP (-2800 USD) Today.

Current losing streak is 5 days
Current drawdown is 23,750GBP (30,000 USD) from high watermark made in May

Why don't you post your positive trades as well? Just posting losing days, and drawdowns beyond what many people can stomach (or afford), is not inspiring.

On Tuesday last week you posted you lost 7K USD that day. Losing lots of money each week is not a rite-of-passage.

Are you netting positive? Please post the good news WITH the bad. Most traders here have had their balls sheared off with bad days. But the constant blather about loss after loss after loss is not something anybody can learn from.

 

[Millionaire]

Please post the good news WITH the bad. Most traders here have had their balls sheared off with bad days. But the constant blather about loss after loss after loss is not something anybody can learn from.

The point of this journal was/is for me to publicly journal my losing days with the hope that this should help me better accept them emotionally.
I started this journal in May feeling a large drawdown was imminent in my trading. This has borne out to be the case.
This drawdown could have several more months to go.
I hope i can continue to trade with discipline if more losses occur and the drawdown gets worse.
And not abandon my system (ie lose discipline) just around the time my account equity curve bottoms outs.
Perhaps in a few years i will give an update on profits.
But not at this stage. Pride comes before the fall and all that...The market has a habit of taking back profits with a big drawdown.

 

[themickey]

My fear and beleif is, if you focus on the negative you will achieve what you are focusing on.
An example, if you would like to live in a nice house, don't walk the streets gazing at old houses, because you will surely end up buying an old house.
The subconcious mind will lead you to what you intently gaze at.