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2011 Lessons Learned / 2012 Goals Set


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2011 Lessons Learned / 2012 Goals Set

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  #1 (permalink)
Orlando, Florida
 
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I can see a lot of growth and understanding that took place inside myself this year. I can't quite put a time and date stamp on any one drop of wisdom, guessing they'll rarely be that obvious as most are only drops in a bucket. But over the course of a year, I have seen the water in the bucket rise. Some of the things I can put to words that I have either learned or reinforced;


ONE - I have learned to look beyond and outside of the trade itself. I can have an incredible trade and still have traded it poorly. I can also have a terrible outcome but have traded it flawlessly. And by trying to understanding that I gain as a trader.


TWO - Trading out of fear is wrong. I have taken many profitable trades this year where the exit was based on the fear of letting go of where I was in the trade. Trading out of greed is wrong. I have seen trades that I felt “had” to work and I was going to make some money, only to go in heavy and then see that completely alter the psychological dynamics of the trade. Win or lose, I was not in a balanced state of mind. It is possible to trade without the effect of either fear or greed, and that at the absence of those lies logic, reason, strategy, acceptance.


THREE - I've learned that it is good to be driven and make sacrifices in my personal time so that I can study trading, but I have the tendency to get tunnel-vision, where nothing exists but the markets. I have seen how that takes away from the people around me. I have become actively conscious of maintaining balance to my best ability.


FOUR - Watching the market can make more money than trading the market. At least on some days. Learning the patience to wait for the market to show it's weakness, whatever that may be at the time, can have far better results than trying to keep up with it's sometimes bipolar fury.


FIVE - Less is more. At the beginning of the year I maintained a view of four monitors and multiple markets. By mid year I had paired that down to two markets. Shortly thereafter, one market at a time. Then one less monitor, one less chart, one less indicator, etc. Knowing what I am looking for helps.


SIX - I learned to have a more structured routine to my trading that incorporates life outside of trading. Like, I started taking a yoga class on Thursday nights. While I am there, in my mind I have found a quiet place in my mind to improve my trading clarity. I also run my dog around the lake in the middle of downtown some evenings, with people and other dogs everywhere. Besides being good physical exercise, it brings back the reality that there is a whole big world outside my computer monitors.






I can also see things that I want to be my focus for trading in 2012;


ONE - I want to let my winning trades ride a little further. Maybe not all the way, but give it a little more breathing room. I may have to give up some win percentage points to do that, which psychologically means being wrong more often.






Unfortunately, this is how the year begins. A single goal, that hopefully by the end of next year will produce a longer list of realizations.

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  #3 (permalink)
Legendary Market Wizard
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Great insights Gary, many of which mirror my own observations and goals for next year. Hoping your holiday is well, and look forward to following along in 2012 while trailblazing my own path even further.

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Legendary Data Wizard!!!
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GaryD View Post
I can also have a terrible outcome but have traded it flawlessly. And by trying to understanding that I gain as a trader.

The majority of new traders and even some experienced traders never get this; it is possible to do everything right and still lose the game.


GaryD View Post
THREE - I've learned that it is good to be driven and make sacrifices in my personal time so that I can study trading, but I have the tendency to get tunnel-vision, where nothing exists but the markets. I have seen how that takes away from the people around me. I have become actively conscious of maintaining balance to my best ability.

Those who have passion for what they do fall victim to this. I have the same passion and at times have tunnel vision toward trading. I am working toward the same goal to live a balanced life.


GaryD View Post
FIVE - Less is more. At the beginning of the year I maintained a view of four monitors and multiple markets. By mid year I had paired that down to two markets. Shortly thereafter, one market at a time. Then one less monitor, one less chart, one less indicator, etc. Knowing what I am looking for helps.

Right on! To quote Steve Jobs: : “That’s been one of my mantras — focus and simplicity. Simple can be harder than complex: You have to work hard to get your thinking clean to make it simple. But it’s worth it in the end because once you get there, you can move mountains.”



GaryD View Post
SIX - I learned to have a more structured routine to my trading that incorporates life outside of trading. Like, I started taking a yoga class on Thursday nights. While I am there, in my mind I have found a quiet place in my mind to improve my trading clarity. I also run my dog around the lake in the middle of downtown some evenings, with people and other dogs everywhere. Besides being good physical exercise, it brings back the reality that there is a whole big world outside my computer monitors.

I started practicing mindfulness a couple years back. Being aware of what you doing when you doing it is a experience to be experienced. It helps me realize when I am ignoring those around me and brings peace and order to an otherwise chaotic world.



GaryD View Post
I can also see things that I want to be my focus for trading in 2012;

ONE - I want to let my winning trades ride a little further. Maybe not all the way, but give it a little more breathing room. I may have to give up some win percentage points to do that, which psychologically means being wrong more often.

Less is more. This one the most difficult concepts I have had to wrap my mind around regarding trading; that is leaving ticks on the table is ok. In the long run it is actually more profitable. Why? Because you are trading within a set of boundaries, the sweet spot if you will, where you have the highest consistency and success. This is like compounding interest. It builds slowly in the beginning but grows more swiftly as time progresses. When you are outside the boundaries your trading becomes erratic like a 401k. Up 10% one month and down 15% the next; its all over the board. A few years ago my trading was like a 401k. I have since come to terms with leaving ticks on the table.

Its interesting how I view a 150 tick run in my automated strategy. In the past if I made 20 ticks and the market continued for another 130 I would have been having a anxiety attack over all the money I lost.<-- this makes me laugh.. My calculator would be up the screen counting missed profits... what could of been. What I failed to realize at the time is my strategy was set up to gain 20 ticks nothing more. I was expecting it to be de facto strategy for all market moves in all market conditions when in actuality it was only setup for one type of market move under very specific conditions. Not knowing the obvious caused me to go back and change the strategy over and over again trying to capture every tick. All this did was take a simple strategy and make it very very complicated. Its kinda funny looking back on it.. Once I simplified it and removed the clutter and complexities it started to work better than I could have ever dreamed. Now, I get my ticks and wait for the next entry to happen.

Excellent observations Gary! Putting wisdom into words is tuff but you make it look easy!! Thanks for sharing!

SD

nosce te ipsum

You make your own opportunities in life.
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  #5 (permalink)
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SD, awesome post and thanks for taking the time to write it.

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  #6 (permalink)
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Mine's a little more arcane, a bit more harsh and has little to with indicators but much to do with my biggest weapon - my mind.

But first, a foreword from one of the creators of our generation.


  1. I will continue to make mistakes in 2012, those do not worry me.
  2. I will push harder this year, not because it's a regimen, but because I love this game. I become it.
  3. I have thick skin, I can take abuse, failure, doubt, criticism. I do not need to retaliate, I just push harder, harder than the other guy. Look at yourself as a creator, a provider, a protector. Screw the new age, egalitarian BS. Be an alpha.
  4. I will continue to not predict things, not have any opinions, not watch TV, not listen to anything but my instincts, simply watch price, watch how others get into pain. I will continue to not have a clue about what the future holds.
  5. I will keep doing the small things right, and my profits will continue to grow. Just as they did in 2011, and 2010.
.


Out of 53posts that I have made, none have been on any of my trading approaches, so here is one (of many). DO NOT listen to how the indicators are used. What matters is the perception of risk. This is not a how to, or the right way, or the wrong way, It has flaws, it has it's good points. It is one way to trade (of many). This vid is about a month old, and the only one I have ever made. Likely never to be made again.

I don't pay much attention to trading approaches, because approaches change, get tweaked, refined, overhauled over time. They are less important. However, if my mind is is the right place I will continue to evolve postively and it will show in my profits. That is all I can do. That is my battle.



Remember this, the year is over, you have survived, while many have not.

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  #7 (permalink)
Orlando, Florida
 
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Posts: 6,462 since May 2011

I love this website! The honesty, the sharing, the insights, the pain and the glory, the give and take. It's most often a discussion of much deeper issues than trading. It weaves in a story of understanding and personal growth, of pain and emotional breakthroughs. Ultimately, our profits will matter less than our life experiences, and I am thankful to be involved in these moments. Thanks for some great comments. My favorites are below.



Silver Dragon View Post

"The majority of new traders and even some experienced traders never get this; it is possible to do everything right and still lose the game."

"Simple can be harder than complex: You have to work hard to get your thinking clean to make it simple."

"Being aware of what you doing when you doing it is a experience to be experienced."

"Less is more....Once I simplified it and removed the clutter and complexities it started to work better than I could have ever dreamed."

SD




Deucalion View Post

"... my biggest weapon - my mind."

"I will continue to make mistakes in 2012, those do not worry me."

"Look at yourself as a creator, a provider, a protector. Screw the new age, egalitarian BS. Be an alpha."

"I will continue to not predict things, not have any opinions, not watch TV, not listen to anything but my instincts... I will continue to not have a clue about what the future holds."


"I don't pay much attention to trading approaches, because approaches change, get tweaked, refined, overhauled over time. They are less important. However, if my mind is is the right place I will continue to evolve postively and it will show in my profits. That is all I can do. That is my battle."


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  #8 (permalink)
desert CA
 
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Thanks for the thread GaryD and thanks for the comments and educational video Deucalion. I've noticed you have some emini-watch indicators. I use some of them too in my own way. Interestingly Barry Taylor, the creator of the indicators uses his indicators exclusively , but I still haven't got a precise idea of how he uses them. So I just use them as another tool and in your video, you seem to use them very well with your own risk management methods.

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  #9 (permalink)
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What I learned in 2011:

1. Take it easy. This is simple, not easy but simple. Don't over complicate anything.
2. Just wait. The market will come to you. If you press, you will end up kicking yourself over it.
3. Risk control is king. Preserve capital above all else.
4. When market conditions are favorable to your trading method, commit to the trade with as much size as you can afford without violating your risk parameters.
5. Don't be greedy.

My objectives for 2012:

1. Trade less with more size as I can afford it.
2. Trade less overall.
3. Journal better. In other words, each trade should have a journal entry that details set up, market condition, trade expectations and result along with emotions as I remember them. This alone will probably lead me to trade less as I hate this kind of detailed journaling.
4. Keep better records of all trades. This year I have been maybe 50% in keeping a detailed record of each trade. What I want to do is keep a track record of each kind of trade set up and its overall win rate, profit ticks, etc. This will mean setting up a new spreadsheet. I haven't done this yet so it may end up on the cutting room floor.
5. Take more time off. The last couple of months, I have taken time off several times. It has been really good for me. So I think I will resort to something I used to do. I will divide my year into three categories. Trading Days, Buffer Days and Off Days. Buffer days are days where I work ON my trading business. This would include looking at new platforms, tax planning, trade tracking and analysis, etc. Off Days are no trading related activities allowed. No charts, no reading about trading, no forum, etc. Just time with family or perhaps time for me to do things I enjoy with no schedules.
6. Begin thinking about the concept of Legacy and what that means to me both now and in the future and concrete action steps I will take to address each idea that comes from thinking about Legacy.

I have other objectives but they are in the realm of to personal to list here. Suffice to say, trading is important to some of them and irrelevant to others.

Simplicity is the ultimate sophistication, Leonardo da Vinci


Most people chose unhappiness over uncertainty, Tim Ferris
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  #10 (permalink)
Northern Germany
 
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PandaWarrior View Post
4. Keep better records of all trades. This year I have been maybe 50% in keeping a detailed record of each trade. What I want to do is keep a track record of each kind of trade set up and its overall win rate, profit ticks, etc. This will mean setting up a new spreadsheet. I haven't done this yet so it may end up on the cutting room floor.


You will probably kill me for annihilating your best excuse for perhaps not journaling too rigorously in 2012, but anyways, you might want to have a look at this journal template, perhaps it can save you some time...


vvhg

Hic Rhodos, hic salta.
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  #11 (permalink)
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nice!
thanks for the thread gary.

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