Quote from actionzip54:
I hope you or lescor, if he is reading, didn't take any offense to my post where I said that your slower years were because of complacency. If that is the case, I don't blame you as it's obvious you made more than enough during your "better" years to allow for a little complacency. I'm sure it's hard to stay motivated when you have accomplished quite a bit. Best of luck to you too. I can't wait for the fed to stop holding the market hostage either.
No offense taken whatsoever, and I am certain Lescor feels the same way. I should, however, point out that complacency is not a primary factor in my declining trading performance (and I suspect that Lescor would say the same).
There are two issues at play here. First, there is the market environment (volatility specifically). Also, there is how the trader responds to a new environment (adapting, creating new strategies, evolving, etc).
Personally, my trading has always tended to perform better in higher volatility environments. I've essentially traded the same way for a decade. During that time I've continually improved and refined my trading by using improved order routing methods and other small enhancements. However, I would say that my trading is 90-95%+ identical to how I traded a decade ago. During that time, I have seen my trading go from very good, to exceptional, back to good and now to what I'd describe as poor (low six figures). Note that this was all with roughly the same amount of annual effort and focus on my part.
My point is that during that time, I have NOT continually evolved in my trading style. Instead, I have merely tweaked an already successful method to incrementally improve it. I have continued to tweak my methods over the past couple of years (of declining performance) and have no doubt that my trading strategy is more capable today that it has ever been in the past - for the same volatile conditions. If 2008 was repeated next year, I suspect that I'd be able to double my performance from that year.
During the past decade, I have never needed to restart from the beginning and develop entirely new strategies. Currently, a restart from the beginning is probably warranted, assuming I want to profitably trade in a low volatility environment. Instead, I simply choose not to trade in this environment and will wait until conditions improve (if that occurs).
In regards to complacency, I would argue that I have been no more or no less complacent that I have been during the last decade. My self described laziness is associated with my current refusal to invest substantial time and effort into creating new strategies for a low volatility environment. Note, however, that this is not a change for me, as I've not taken on this sort of major overhaul in the past 8+ years.
To summarize, I don't believe that the change in my trading performance in recent years is due to complacency. Instead, I would say that the change in my trading performance is due to the changing market conditions and that my complacency may be preventing me from potentially reversing my profitability decline in this environment.
Please note that this response is in no way to 'defend' myself again the word complacency. I'm simply trying to clarify that while I may be guilty of complacency and laziness, that this is not a large factor in my declining profitability in recent years. The primary cause has been the declining volatility of the markets.