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Psychology of going from Sim to Real money
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Psychology of going from Sim to Real money

  #11 (permalink)
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motowater View Post
Does anyone take a month or two off when they feel they are losing?

Whenever it's needed, sometimes to develop a fresh approach, or review current state or just to get some rest and recuperation. Then plan to get to a point where you don't need to actively screen trade for more than a few hours. Some only do a few minutes, some do all day, find your own sweet spot.

Travel Well
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  #12 (permalink)
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motowater View Post
How do I make a losing day a winning day? It is hard to trade for so long.

motowater,

do you have a trading plan that deals with stuff like that?
Specifically a daily loss limit and what to do when it's hit. What if you hit the daily loss limit on two days in a row.

Regards,
ABCTG

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  #13 (permalink)
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motowater View Post
I recently have been having huge breakthroughs in my chart reading capabilities. For the past few weeks I have been hitting 70% accuracy in my trades. I am debating when how long to wait before I trade with real money. I'm thinking a minimum of two weeks.

The thing is the past 3 times I have tried trading with real money I have lost... and now I am fearful I will lose again. Its hard for me to get past that. Does anyone have any tips on how to psychologically make myself believe I can do it with real money?

Normally I'd give you a whole break down of what you could be doing differently but I don't have the time. One thing that sticks out is that you're changing strategies which usually is indicative of not having a fully practiced system. With that being said, I think you're on the right path. Most of what you're talking about is only learned with experience. It's very hard to tell someone how to prepare for a boxing fight without training with them and that's why I believe my, or anyone else's specific advice at this point may conflict with your system(s).

If I lose my third trade of the day I just stop because I know if I lose my fourth or fifth trade it will be too uncomfortable for me to continue trading without digesting the internal conflict and residual resentment that it stirs up. Just like when you get into a serious argument with someone it takes time to cool off psychologically which may take a couple days. know yourself first and foremost. Know your tolerance to loss or excitability. That's the heart of psychology.

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  #14 (permalink)
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Trading with real money vs sim is like driving a car vs playing a racing game. Nothing alike. Ever seen a 16 year old try to drive for the first time? Not quite like PlayStation, is it?

Sim trading is good for observing how markets move, but otherwise is a waste of time. In much the same way the market said to me last week as I got my ass handed to me a couple of days, I say to you, "welcome to trading." All those twitter people are heroes of trading--ever wonder why? Well it's easy to lose, win, and always be level-headed when it's all on paper. Real traders lose, win, and everything in between. Best of success to you.

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  #15 (permalink)
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Itchymoku View Post
Normally I'd give you a whole break down of what you could be doing differently but I don't have the time. One thing that sticks out is that you're changing strategies which usually is indicative of not having a fully practiced system. With that being said, I think you're on the right path. Most of what you're talking about is only learned with experience. It's very hard to tell someone how to prepare for a boxing fight without training with them and that's why I believe my, or anyone else's specific advice at this point may conflict with your system(s).

If I lose my third trade of the day I just stop because I know if I lose my fourth or fifth trade it will be too uncomfortable for me to continue trading without digesting the internal conflict and residual resentment that it stirs up. Just like when you get into a serious argument with someone it takes time to cool off psychologically which may take a couple days. know yourself first and foremost. Know your tolerance to loss or excitability. That's the heart of psychology.

Three losing trades in a row is a good stopping point. After two losing trades in a row I will cut my position size to a minimum. I will sometimes stop at two if clearly I am totally out of sync with the market rhythm.

On those days when something doesn't feel right or my method is not working, I shut it down and come back the next day. Sometimes if I am in the mood and have the free time, I may switch to the sim trading account and keep taking signals for an hour or so just to get back into sync with the market and restore my confidence.

One key to all this is to have absolute and unwavering confidence in your trading method / system, you accept some day's it doesn't work, but you know it does work most days (you even mentioned yourself 80 % of the days were profitable). You trust your method and come back the next day knowing it will work today. If you lack that level of trust in yourself and your method, your not ready to trade live.

One thing you have to analyze is, on your live trading days, how many trades did you take as compared to the average number of trades you took per day in the simulation testing phase. If those two numbers are widely disparate, then your sim trading may not be realistic enough to be of any meaningful value in evaluating the system for live trading. ( As they are really two different systems ). You might also look at your average win and average loss, and see if there is a significant difference there as well indicating additional stress related problems.

Be Patient and Trade Smart
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  #16 (permalink)
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josh View Post
Trading with real money vs sim is like driving a car vs playing a racing game. Nothing alike. Ever seen a 16 year old try to drive for the first time? Not quite like PlayStation, is it?

Sim trading is good for observing how markets move, but otherwise is a waste of time. In much the same way the market said to me last week as I got my ass handed to me a couple of days, I say to you, "welcome to trading." All those twitter people are heroes of trading--ever wonder why? Well it's easy to lose, win, and always be level-headed when it's all on paper. Real traders lose, win, and everything in between. Best of success to you.

I would say sim trading is only good for learning your platform and how to place orders. Not for any type of performance oriented or goal oriented trading, or even learning order flow or just being an observer. I say that because what you observe when you have no money on the line is not like what you observe when you do have money on the line.

I see traders on futures.io (formerly BMT) that have been on sim for years and post all kinds of charts, changing their methods every few weeks or months. To me it's an enormous waste of time to see such a thing, I don't think for a moment these people are any closer to being good traders. The real learning experience starts when you begin trading cash. That is why I recommend you start with micro FX currency futures, or spot forex, or whatever it takes to put a little bit of your money on the line and learn from it.

Mike

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  #17 (permalink)
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Thank stinky sweat...


motowater View Post
I recently have been having huge breakthroughs in my chart reading capabilities. For the past few weeks I have been hitting 70% accuracy in my trades. I am debating when how long to wait before I trade with real money. I'm thinking a minimum of two weeks.

The thing is the past 3 times I have tried trading with real money I have lost... and now I am fearful I will lose again. Its hard for me to get past that. Does anyone have any tips on how to psychologically make myself believe I can do it with real money?


I agree with Big Mike and the other's on this...

Having traded at large firms using OPM, and staring at large losses because you had to take on customer positions that you didn't want... and trading my own measley sums in comparison... Sim is only good for as Mike states, learning the mechanics, and the mechanics you learn while you are simming, may not hold up under pressure. And when you start losing, no one likes it, our brains do weird things to our psyche, like well if I take this 10 lot on and get 2 tic's I make my loss back... guess what happens 99% of the time? flush...

That stinky sweat comes when you're trading your own money, and that's the only way to know how you're going to hold up. It's like a great minor league prospect or Heisman trophy winner... who knows...

Now outside of Monday, the market's at least the ES has not been easy sledding this week, so don't be to quick to change your methods... the set up's have been fast and often times erratic and not very consistent in their behaviors... The market's will make you question every fiber of your being at some point. And if you are not committed to your beliefs, it WILL break you, financially and most likely mentally.

Go over some of FT 71's videos, not neccessarily to change your methods, but his psychology is very straight on how to approach winning and losing... It helps to massage the self inflicted wounds.

All the best,

Joe

In alcohol's defense, I've done some pretty dumb shit while completely sober too.
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  #18 (permalink)
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That is what my strategy has relied on for the past 6 months though. I think I just have to find a way to stay cool.

That day that was negative. At about 10:00 CST I was thinking you know that I got this and I would do fine. I was telling myself I was under control and I kind of was, kind of wasnt. It was after the day closed I kept thinking about the negative end to my day and those thoughts persisted.

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  #19 (permalink)
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motowater View Post
That is what my strategy has relied on for the past 6 months though. I think I just have to find a way to stay cool.

That day that was negative. At about 10:00 CST I was thinking you know that I got this and I would do fine. I was telling myself I was under control and I kind of was, kind of wasnt. It was after the day closed I kept thinking about the negative end to my day and those thoughts persisted.

In a lot of ways, it is sort of like baseball... you have to have a short memory, but remember how the pitcher got you out... then you forget the immediate failure, as striking out is part of the game, but remember the situation and the pitch you got... it does no good to dwell on failure, as FT 71 and others will tell you, it's 50/50 and you have to let it go...

In alcohol's defense, I've done some pretty dumb shit while completely sober too.
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  #20 (permalink)
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Well its a good thing I need a short memory because I have possibly the worst memory out of anyone here.

Honestly, I am probably bottom 5th percentile in memory.

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