RM's occasional market calls...
- Thread starter Rearden Metal
- Start date
The same combination of reasons why J. Livermore died with no liquid cash and not much else- at least compared to the fortunes he once held at his various peaks. While I have much better taste in women than Livermore ever did, we both suffer from an identical flaw; Taking trades we know we shouldn't. When the idea for UVXY (and every other trade posted here) came to me, I got this special warm fuzzy feeling about the trade- Like the feeling a typical mooselimb guy gets right before he murders a restaurant full of innocent civilians. I just <b><i>knew</b></i> the trade was rock solid. If only I had the discipline to watch the market inactively while waiting around for those occasional 'warm fuzzy', very high-confidence ideas, I'd have probably surpassed entry level rich a long time ago.
"If only I had the discipline to watch the market inactively while waiting around for those occasional 'warm fuzzy', very high-confidence ideas, I'd have probably surpassed entry level rich a long time ago."
Your big calls have been great. If you have been struggling with it for a long time, "sitting on your hands" is likely not a viable approach.
You need some bread and butter stuff that keeps you occupied while you wait for the big ideas. All it has to be is break-even or a bit better to be worth it.
Your big calls have been great. If you have been struggling with it for a long time, "sitting on your hands" is likely not a viable approach.
You need some bread and butter stuff that keeps you occupied while you wait for the big ideas. All it has to be is break-even or a bit better to be worth it.
And that is the answer we must give ourselves when we ponder why we are not as successful as we would be without this flaw. While penury is likely not in your future, it must become eventually suffocating to live with the consequences of this self imposed issue knowing that the solution was always available with a little more effort and willpower. What will be your catalyst for change?
Snap.
I now understand what you were trying to communicate to me in your emails, which I was too thick headed to recognise the first second and third time!
I get those warm fuzzy feelings too. Almost never take any heat on those signals. My strike rate for those subset of trades is massively greater than the others. I believe that with enough practice, effort, and understanding the majority of trades could eventually be "warm fuzzy" trades. That was my plan all along but I wasn't sufficiently diligent and disciplined in sticking to it. Instead I like to think I'm cleverer than I am and play where there isn't sufficient opportunity or clarity, or where I'm not skilled enough to use the opportunities (fast markets etc) and would be best staying out. This one flaw has cost me well into the seven figures. The worst aspect of this is when you tolerate, or give permission to some degree, because you are only giving back profits you have made in other markets. Money is money and this sort of mental accounting and rationalisations does nothing to kill the problem. I've concealed cumulatively millions worth of "losses" in this way.
Hubris, complacency, lapses of discipline, inattention to detail...I sometimes wonder if some of us suffer from...how to put it...some sort of mental block against a bigger level of success, which results in forms of self sabotage (what else would you call this issue)?
This is why I was interested in garachen's contributions to the other thread, moving up into different categories of wealth/income generation, and the barriers which must be overcome to "move up" to the next level. Unfortunately the peanut gallery, who are dreadful bores, derailed the discussion.
I hope you have the personal realisations necessary to overcome this debilitating problem. I think the solution may be similar for others similarly afflicted, but the process to discover it will be unique to the individual. Whatever the solution, I believe such crutches as workplace discipline, being in the company of other or more successful people (eg. at a top firm etc) can be massively helpful in raising your game. However, these are crutches, and the goal is to improve yourself to where you do not need them. It takes a special sort of person to be able to generate consistent energy,motivation, etc working from home. But we mustn't use the difficulty as an excuse to stop trying or for failing to achieve the goals we set for ourselves.
When our day is over, only we know whether we truly did everything we could to advance our personal growth and progress towards our goals. No use lying to ourselves. We will live with the consequences of our decisions. No wonder many or most avoid, blame, deny, etc.
This problem ranks below not having a +ev strategy, being unable to pull the trigger, quitting when ahead for the day...but its still pretty high on the list of "things you can do to yourself to stop you getting where you want to go".
I was dumping UVXY on the way down there. Some was sold near the top at my limits, and some was sold at significantly less awesome prices. Current price is 6.29, and I'm down to small size. I may or may not re-enter, but I don't need piggybackers holding on here and hoping...
Fine post, Blotto. Glad you get it now!
From past experience I know I'm probably setting myself up for a PM box full of useless shariah* and absolutely nothing will come from this, but if someone out there has a perfect idea for what that 'bread and butter stuff' would be for me, my mind is technically open to buying/leasing it from you.
*Try replacing curse words with Islamic terms some time, it's fun!
I'm such a bigot, but at least I have a good excuse for it- considering my background and the fact that I lost my mental stability somewhere in a hot sweaty desert P.O.W. camp full of thousands of Palestinian terrorists. Besides, opposing a defective philosophy like Islam (or communism) isn't at all the same thing as racism- which isn't my bag at all.
From past experience I know I'm probably setting myself up for a PM box full of useless shariah* and absolutely nothing will come from this, but if someone out there has a perfect idea for what that 'bread and butter stuff' would be for me, my mind is technically open to buying/leasing it from you.
*Try replacing curse words with Islamic terms some time, it's fun!
I'm such a bigot, but at least I have a good excuse for it- considering my background and the fact that I lost my mental stability somewhere in a hot sweaty desert P.O.W. camp full of thousands of Palestinian terrorists. Besides, opposing a defective philosophy like Islam (or communism) isn't at all the same thing as racism- which isn't my bag at all.
what a great way of describing the situation blotto. I would add this: someone once asked me how i stay disciplined working from home. we got to talking and one of the paths our conversation took was me discovering/expounding that sometimes discipline means sleeping til noon, then going to play golf - the beach whatever then coming home having some burgers and beer and watching movies.
Of course, a regular civilian had a tough time understanding what I was saying. But I still think this way and think it is very important to just DO ABSOLUTELY NOTHING if that is what the market tells me. If the market is dead and doesn't lend itself to my style of trading, I am better off 'wasting time' or however you want to put it. I would get a voice in my head telling me I had to work and stop being a bum but I learned to ignore it and I think it has saved me money. When you try to force a trade to happen when the conditions for it are not met (ie market sucks - market is slow or whatever) you are going to lose over time. I probably get around 2-6 times a year where I get that feeling. I should learn to restrict my trades to around those periods. If I can't do that, I should at least only put on my biggest size when that happens, and just have a small amount of contracts when I don't get that feeling. It definitely requires a unique mindset to be a speculator.
Of course, a regular civilian had a tough time understanding what I was saying. But I still think this way and think it is very important to just DO ABSOLUTELY NOTHING if that is what the market tells me. If the market is dead and doesn't lend itself to my style of trading, I am better off 'wasting time' or however you want to put it. I would get a voice in my head telling me I had to work and stop being a bum but I learned to ignore it and I think it has saved me money. When you try to force a trade to happen when the conditions for it are not met (ie market sucks - market is slow or whatever) you are going to lose over time. I probably get around 2-6 times a year where I get that feeling. I should learn to restrict my trades to around those periods. If I can't do that, I should at least only put on my biggest size when that happens, and just have a small amount of contracts when I don't get that feeling. It definitely requires a unique mindset to be a speculator.
thks RM and rest.
receipe that works for me:
trade size 10x to 100x larger than normal designed that win makes material difference to NAV whether win or lose.
For these trades use very aggressive compounding so that net 10 wins will make me in independent category.
Above ensures I do not play this size except when warranted. Non complying trades are lost with much smaller sizes.
Gave up on trying to prohibit myself from trading when not warranted. Can't do.
receipe that works for me:
trade size 10x to 100x larger than normal designed that win makes material difference to NAV whether win or lose.
For these trades use very aggressive compounding so that net 10 wins will make me in independent category.
Above ensures I do not play this size except when warranted. Non complying trades are lost with much smaller sizes.
Gave up on trying to prohibit myself from trading when not warranted. Can't do.