Profitable on paper, losing money live! Fear plays a big role.

[ftrexx1]

ftrexx1,

Only YOU know what the problem is. Be brutally honest with yourself and write the Fear you are experiencing.

Here is some fears while trading live you could be experiencing

1. Hesitating to take trades.
2. Not paying attention and not focus.
3. Horrible trade management
4. Trading without a stop
5. Doubting your self
6. Doubting yourself, then start chasing trades after you missed it, then trying to scalp a few ticks.
7. Not following your rules.

Stop worrying about the money, and worrying about being confident and comfortable when trades.

Try this
1. Stick to one contract, take it one trade at time, properly manage it just like you would in sim.
2. Screen shot real vs sim trades.
3. Record notes on each trade. State what you did wrong, what you did right. what you need to improve on. Why you entered and why you exited. Is this a good or bad trade.

Just be honest with yourself.

For example, one of my biggest problems is 1. Being focus 2. trade management after entry. 3. studying trading during spare time and putting in the work.

So I have to work on those things.

Thank you so much for taking the time to reply!

I have to say that I share the same fears when live trading. It appears in my case that fear results in more hesitation to enter the trade and then enter too late and tight the stop loss too soon when I'm in a profitable trade. And of course revenge trade is an issue sometime.

Being discretionary trader doesn't help because I'm not following any strict rule so psycology play the biggest role. Anyway good advices. Thanks

 

[qlai]

Being discretionary trader doesn't help because I'm not following any strict rule so psycology play the biggest role.

Being discretionary trader does not mean no rules. You should absolutely have rules as far as execution of your strategy is concerned. Discretionary means you are not rigid with your rules and use context and gut/experience to override your rules at times ... like a filter. But entries, stops, trails, money management ... all rigid rules as CURRENTLY defined, imho.

 

[murray t turtle]

Just in case all the skeptics on this site decide to attack me!!!

https://www.cmegroup.com/education/...ussell-2000-index-futures-spread-trading.html

%%
And CME noted market impact ......has proven less with CME, than ICE.Most any spread or pair trade should have some diversification , but sure could lose on both sides.......

 

[ftrexx1]

Being discretionary trader does not mean no rules. You should absolutely have rules as far as execution of your strategy is concerned. Discretionary means you are not rigid with your rules and use context and guy/experience to override your rules at times ... like a filter. But entries, stops, trails, money management ... all rigid rules as CURRENTLY defined, imho.

I understand that. It will take time come up with a set of rules that adjust well with all different market condition. it also takes time to learn when market condition are about to change before they are already in place.

 

[qlai]

I understand that. It will take time come up with a set of rules that adjust well with all different market condition.

Until then, you are to be judged by how well you execute your CURRENT rules. And stop trading live when conditions are not "familiar"

 

[murray t turtle]

Being discretionary trader does not mean no rules. You should absolutely have rules as far as execution of your strategy is concerned. Discretionary means you are not rigid with your rules and use context and gut/experience to override your rules at times ... like a filter. But entries, stops, trails, money management ... all rigid rules as CURRENTLY defined, imho.

%%
Exactly; + even system traders need plenty of discretion-money management , discretion to use the best system.......To tight a stop is very counterproductive+ as much things as we can plan[like stops] are best planned, in advance. I cant think of any better way to fail, than plan nothing, ftrex!.

The reason to tight a stop is counterproductive, is NO such thing as a business without business expences[losses].PSAR which i seldom use, but good reminder to tightens stops as the days or weeks in trade increase....................................................................................................................

 

[gaussian]

Hi,
I would like to share my frustration with my recent day trading experience.
I have been day trading the NQ for about six months and my account is definitely shrinking. Every time I go back to the paper account I make big profits. Nothing changes, same number of R/T between 50 and 100/day, same price actions rules but
when i go back to the paper account I average 2K every day consistently. With the live account it is a great day if I'm up $150. I was aware that the fear plays a big role but WTF!
Do you guys have some suggestions how to overcome the fear? Some tricks?

I'm going to guess you aren't keeping to a rigid system? If fear is playing a role my guess is you are pulling out of scary events too early and losing money.

The textbook solution to this is to lower your exposure to a level you control. If you're spending 10% of your capital on trades move that to 5%. If you're at 5%, move it to 2%. I think a lot of fear (at least for me) came from watching my money evaporate. Some of it also came from trading overleveraged with super tight stops. I also stopped trading on the hourly. I trade almost exclusively on the daily timeframe and that has fixed a lot of my fears.

Another difference between paper and live is fills. You could be getting terrible fills live if you're placing market orders (you weren't specific) whereas the simulator is giving you the best fill all the time. This has a tremendous effect on market perception.

My best advice is (in no particular order):

1. Lower your exposure to a place where you are comfortable "letting a good idea ride" in the market. This may mean leaving futures altogether for a bit and choosing something better for your desired exposure (options on ETFs holding NQ...or whatever).
2. STOP paper trading. Paper trading is worthless. I know this is probably controversial but I've never met a success story that started paper trading. Most people trade small lots ("one lotters" in the futures market) and eventually blow up and build again. To me, this "lose money learning" is equivalent to paying your tuition and you learn a lot about yourself and your hang ups this way.
3. Use limit orders rather than market orders to get more reasonable fills.
4. Change your timeframe.
5. Don't change your stops. Once set, leave them. If anything adjust them once per day (to either lock in a profit, or widen due to expected vol).

Hope this helps.

 

[wrbtrader]

I understand that. It will take time come up with a set of rules that adjust well with all different market condition. it also takes time to learn when market condition are about to change before they are already in place.

Whatever rules you start using as a discretionary trader...backtest it to determine if hypothetically profitable or loser. If you can do that, you'll be ahead of most discretionary traders.

wrbtrader

 

[ftrexx1]

I'm going to guess you aren't keeping to a rigid system? If fear is playing a role my guess is you are pulling out of scary events too early and losing money.

The textbook solution to this is to lower your exposure to a level you control. If you're spending 10% of your capital on trades move that to 5%. If you're at 5%, move it to 2%. I think a lot of fear (at least for me) came from watching my money evaporate. Some of it also came from trading overleveraged with super tight stops. I also stopped trading on the hourly. I trade almost exclusively on the daily timeframe and that has fixed a lot of my fears.

Another difference between paper and live is fills. You could be getting terrible fills live if you're placing market orders (you weren't specific) whereas the simulator is giving you the best fill all the time. This has a tremendous effect on market perception.

My best advice is (in no particular order):

1. Lower your exposure to a place where you are comfortable "letting a good idea ride" in the market. This may mean leaving futures altogether for a bit and choosing something better for your desired exposure (options on ETFs holding NQ...or whatever).
2. STOP paper trading. Paper trading is worthless. I know this is probably controversial but I've never met a success story that started paper trading. Most people trade small lots ("one lotters" in the futures market) and eventually blow up and build again. To me, this "lose money learning" is equivalent to paying your tuition and you learn a lot about yourself and your hang ups this way.
3. Use limit orders rather than market orders to get more reasonable fills.
4. Change your timeframe.
5. Don't change your stops. Once set, leave them. If anything adjust them once per day (to either lock in a profit, or widen due to expected vol).

Hope this helps.

It is really cool that people on this forum take time to write down advises and share their own experiences!

 

[ftrexx1]

Whatever rules you start using as a discretionary trader...backtest it to determine if hypothetically profitable or loser. If you can do that, you'll be ahead of most discretionary traders.

wrbtrader

That would be ideal! I use Multicharts but I don't have the skills to translate my trading rules into a Strategy using Easy Language. Observing two different volume bars charts I try to detect when a reversal is about to take place, of course i'm not always right( ah ah I wish) but it is not about following rigid rules. Stop loss are place always at different distance so no rigid rules here as well.