Why I am A loser

J

James3313

I am about to sell my losing trade that I have been in for 35 days. My unrealized loss is -$1,260 (soon to be realized).

This isn’t the first time I lost money; my last trades included total loss of -$2,300.

You see, I work a shitty job. I get paid minimum wage plus commission (8.75+ commissions).

My average weekly paycheck is $380.00; I am 23 years old and a college dropout.

Bottom of the American society barrel.

NOTE: Parents feel free to show your kids this post to show them what life is like when a person decides to drop out of college.

I have been trading options for the last 8 months with a total loss of -$3,695 and counting. Here is a blog where some, not all, of my trades have been recorded. http://jsochi.blogspot.com/

How did I get to this place, read on…

Rewind a year back, I was a college student on my way to attend Sac state. Given my ambitious personality I wanted to be rich. I started reading articles on investing and over and over again kept hearing that the best time to start investing is in the 20s. With time on your side, it will compound of the years.

So I started doing research on investing. My friend told me that he made 1000% almost every month trading Google options (this was when Google was making its run to $750 a share) and that’s how I discovered options.

Given my extreme personality I jumped right in and started researching options. Soon I didn’t have time for school anymore (didn’t register for next semesters) , no social life, just work and researching. Cut expenses to the bone. Nothing except necessities. Save, save, save.

My schedule is this;

Get up at 6:30am (pacific time) watch market until 1pm
2:00pm go to work
10pm come home do research, read books, online articles etc, analyze charts, discover indicators, etc..
12am go to sleep
6:30am get up

In the mean time save, save, save.

Now its 8 months later and I’ve lost a total of $3695.

I am currently saving up again.

This time I have plan. My plan is -10% stop loss on any trade (no matter what you undisciplined retard!!!!)

I watch XLF Spy on 10 day 60 minute chart with 12ma. Go long short whenever with 10% stop loss.

AAPL, ACH, QQQQ on 1 year daily chart with 30 MA. Go long short when price crosses MA with 10 stop loss.

I want to grow my account 25-35% per month, which is reasonable with options. I have been paper trading (yea yea I know…) my strategy this time it really seems like its got some potential, according to results.

I hope this time will be different. Armed with my stop loss and strategy I feel like its going to a lot easier from here on. I have clearly outlined my rules for this strategy.

They say that doing the same thing over and over again and expecting different results is the definition of insanity. I consider myself ambitious and determined to succeed no matter what.

My goal is to be a consistently profitable options trader. I will either spend my whole trying to succeed at it, or achieve my goal. I have given up everything to be good at this, I don't want anything else in life but this, I want to be a successful options trader.
 
Not too far. Used to live in Davis in 2005 (Davis/Sac City) also making minimum wage. This is not the case any more. It also took me a little over a year and $10,000 in losses before I figured it out. I am just going to be blunt so here it goes...

1. You are out of your league. You simply don't make enough money to warrant trading. Be it resourceful and/or psychological.

2. Why are you trading options? I've always viewed options as a hedging tool. Also, all the institutional quants have these instruments on lock. Consider playing stocks.

3. Re-focus on minimizing risk, instead of maximizing profit. Don't waste any more of your money until you get this through your head.

4. Leave Sacramento. That place is the ghetto.
 
Whoa, easy with the words buddy.

Before trading the markets, learn to develop a sense of "measure", 4000$ lost and a few months of your life "wasted" hardly qualify you as a "loser" as humbling as the experience might have been.
You probably know by now that there is no easy way to get rich, some people take 40 years just to learn that.
 
I was in your situation

I AM TALKIN EXACT your situation

let me tell you something from the heart

it took me 4 years,

I stayed away from options,

I focused on futures (huge money in it)

I focused on trading a single chart, no picking setups on many charts

I focused on day trading only

I focused on keeping loses short and damage control

do what I did, this is a must

I told myself, I am going to give it my best, nothing but my very best, if I ultimately fail I won't have regrets, because I gave it my best
 
A loss of 4k does not qualify you as a looser. As a matter of fact considering that you are 23, on the right track, still trading etc. I have to say 4k must've got you more education than most colleges will ever provide.

Though considering you are trading options, what is your current capital. Are you writing options too? I wouldn't go that way for the sheer disadvantage that creates for smaller accounts. And the beauty of options is how brilliantly you can manage your money (if you only buy to open and sell to close).

when you say 10% stop is it 10% of your account or 10% of the trade amount. If its the latter I would assume you are going to get killed by time decay and it is a great setup for revenge trading which inturn is not at all great.

To keep it simple, take high-probability trades, stay in a trade anywhere between 1-10 days ideally. If you are up for a challenge (for yourself) only trade the current month contract, and you can stay longer in the trade depending on how close are you to expiry.

Also, try keeping you investment in a trade = the amount you are ready to loose in the trade = i.e. the trade in essence is a stop-loss as you would'nt loose a penny more than you intended.

Cant comment on a 60min chart as I havent used that in ages. will leave it here, dont even know if you need the suggestons.

Good luck n Cheers!!
 
I have no appetite for self-help crap but I can honestly speak from experience that self-respect does matter in this game because, in the end, positive attitude will make or break you. Please do yourself a huge favor: Don't demean yourself every time you find yourself down and under.
 
Dropped out of college some years ago for similar causes (I found business administration to be a waste of time), now 24 and have pretty much found my place in the markets - only took about 5 years, lol :/
Your problem seems to be (as someone already mentioned) looking at reward instead of risk, when you refocus on minimizing risk then you'll know you're on the right track.
Keep in mind this is a marathon (again, i'm quoting someone else), call your buddy who dealt with GOOG options and ask him where is he now and try to get an honest answer. Some people only seem to like the boom and bust the market has to offer, ignoring consistency.
 
Quote from James3313:

I am about to sell my losing trade that I have been in for 35 days. My unrealized loss is -$1,260 (soon to be realized).

This isn’t the first time I lost money; my last trades included total loss of -$2,300.

You see, I work a shitty job. I get paid minimum wage plus commission (8.75+ commissions).

My average weekly paycheck is $380.00; I am 23 years old and a college dropout.

Bottom of the American society barrel.

NOTE: Parents feel free to show your kids this post to show them what life is like when a person decides to drop out of college.

I have been trading options for the last 8 months with a total loss of -$3,695 and counting. Here is a blog where some, not all, of my trades have been recorded. http://jsochi.blogspot.com/

How did I get to this place, read on…

Rewind a year back, I was a college student on my way to attend Sac state. Given my ambitious personality I wanted to be rich. I started reading articles on investing and over and over again kept hearing that the best time to start investing is in the 20s. With time on your side, it will compound of the years.

So I started doing research on investing. My friend told me that he made 1000% almost every month trading Google options (this was when Google was making its run to $750 a share) and that’s how I discovered options.

Given my extreme personality I jumped right in and started researching options. Soon I didn’t have time for school anymore (didn’t register for next semesters) , no social life, just work and researching. Cut expenses to the bone. Nothing except necessities. Save, save, save.

My schedule is this;

Get up at 6:30am (pacific time) watch market until 1pm
2:00pm go to work
10pm come home do research, read books, online articles etc, analyze charts, discover indicators, etc..
12am go to sleep
6:30am get up

In the mean time save, save, save.

Now its 8 months later and I’ve lost a total of $3695.

I am currently saving up again.

This time I have plan. My plan is -10% stop loss on any trade (no matter what you undisciplined retard!!!!)

I watch XLF Spy on 10 day 60 minute chart with 12ma. Go long short whenever with 10% stop loss.

AAPL, ACH, QQQQ on 1 year daily chart with 30 MA. Go long short when price crosses MA with 10 stop loss.

I want to grow my account 25-35% per month, which is reasonable with options. I have been paper trading (yea yea I know…) my strategy this time it really seems like its got some potential, according to results.

I hope this time will be different. Armed with my stop loss and strategy I feel like its going to a lot easier from here on. I have clearly outlined my rules for this strategy.

They say that doing the same thing over and over again and expecting different results is the definition of insanity. I consider myself ambitious and determined to succeed no matter what.

My goal is to be a consistently profitable options trader. I will either spend my whole trying to succeed at it, or achieve my goal. I have given up everything to be good at this, I don't want anything else in life but this, I want to be a successful options trader.
More...

Options is not what you want to be trading when just starting off..... anyone that tells you otherwise is a lying sack of shit.

Your expectations are unrealistic 25% to 35% a month...... its easy only in the sense that its mathematically possible.

Put together a business plan.... a well planed business plan with stages and expectations. If you meet a girl and move in with her..... your business plan must be rewritten to reflect it..... if you move in with mom and dad..... your business plan must be rewritten..... any change at all in your life, must be reflected in your business plan.

Put together a trading plan. Not just a 1 page sheet of paper with basic rules for entry / exit, but a detailed plan that takes into account every nuance of trading. When, what, why, how, etc.... you should never feel "lost" in a trade or in a trading day because of an event that wasn't taken into account in your trading plan.
My opinion, your current trading plan needs work.... just by the simple fact when you say 10% loss is going to be your max..... 10% of what??? Your account? Your risk amount? What if someone has 3 losers in one day... all 4% losers, thats 12% loss for the day!
Although you do have a set schedule... which is very good, what does your trading plan say when you dont stick to your regiment?
All these little details must be written into your trading plan.

Stay away from options when new to this (cant say that enough)

Paper trade first. Paper trading wont make you a better trader, but if you dont have the discipline to stay focused, use proper money management, follow your own rules..... while paper trading with no stress......... then most likely, when under pressure from the market with real money on the line, you wont have the discipline to keep a cool head to follow your plan... your fear or greed will get the best of you.... and you will make a mistake.

Alot of people have no idea what role paper trading has.... since it cant make you a better trader.... well thats true, but paper trading is a great litmus test on your personality and patience to follow through. Again, I repeat, if you can not follow your trading plan while paper trading because its too boring or you get impatient.... then forget about the stock market.

$3695 loss in 8 months is not bad at all (although i don't know what that is percentage wise) but the important thing is to look at the trend of your loses. Are they getting bigger? smaller? staying about the same?
I have a spreadsheet in excel that I programed my self...... it keeps track of every single statistic and aspect you can think of, in my trading.... both for month to month, year to year, and a running average of everything. You can always go back a compare trends with issues that go on with your life..... there are correlations!

When you are going through long term tough times and just constantly think about throwing in the towel..... DO IT! Quit trading altogether.... focus on your job or education, family.... dont think about the market. A year or 2 later, begin to get back in.... lo and behold, you will have a different outlook and perspective altogether! Quitting doesn't mean quitting for ever.... its not a race.

Lastly..... do not listen to gurus. It will save you lots of head aches. Gurus only want 2 things from you, to feed their wallets, or to feed their egos. You can spot them a mile away..... dont waste your time with them..... believe me, i learned that the hard way when I started off.
 
I think the vast majority of current consistently profitable traders have paid for their education in the terms of initial losses. My first go around saw a 15k blow out in four months.

The advice on defining a strict system that focuses on money management is huge. Having proper capitalization relative to your strategy is also important. Without proper capitalization your "risk of ruin" is just too high.

Hang in there and do a lot of reflecting on what worked and what didn't.
 
Eh, A little under 4k is all you've lost? I watched $13,000 in "discretionary" savings evaporate first before I traded my way to profit.

A few bits of advice. Don't get frustrated you will dig yourself deeper chasing losses and wonder why the market is cursed against you.

You may not have a proper edge developed. If your system is constantly wrong then it's time to go back to the drawing board.

Keep it as simple as you can. Stop trying to trade multiple stocks. Focus on one thing first and learn it like the back of your hand. Every stock or index has a personality.

There are some stocks I won't touch with a barge pole simply because of the strange way they move.
 
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