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Account blown up
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Account blown up

  #71 (permalink)
Trading for Profit
Kansas City, MO U.S.
 
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I think it's just bad money management. For instance, a futures trader who is on the /ES only needs $500 at most boutique brokers for intraday margin. To bring an account to zero from that balance while having on contract on the table, your position would have to go against you by 10 points. So I think at that point, you are being self-sabotaging. If you aren't cutting your losses well before that 10 point mark, you better be trading longer term positions, because that would take a while to come back from for an undercapitalised day trader. Anyone with a large account that blows it up is probably stretching an account just as thin as the undercapitalised guy.

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  #72 (permalink)
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JacLau View Post
I lost control and blew up my trading account 3 times.

I started trading SGX derivatives full time from mid 2004 with S$200K capital after being retrenched at age 42 from my Engineering job with Chevron in Singapore. 1 USD = 1.37 S$ (SGD).

I made money 7 out of the last 10 years. My total net profits from 2005 to 2014 is about S$1,288,000.

On 15 Feb 2007. I lost S$191K trading SGX MSCI Singapore Index futures. After trading for 2 years, I had zero profits and about S$70K of savings left to support a family with 2 young kids. Lowest point in my life.

On 30 Apr 2009, I lost S$224K trading SGX MSCI Taiwan Index futures and another S$116K the next trading day on 04 May 2009. Total S$340K in two consecutive trading days. I surrendered my life insurance policy the next week, and an investment condominium a month later, to raise additional trading capital after the loss.

On 16 Nov 2012 I lost S$570K trading SGX Nikkei 225 Index futures. Although my trading account was not completely wiped out, unlike the previous two major losses, I forced myself to take a temporary break from trading to reassess my situation. As a result of this major loss, my net trading income over the last 6 years, from 2009 to 2014 is next to nothing.

There were two other "near miss" trading days where my trading account had floating losses that exceeded my trading capital but the market recovered and I had profits at the end of the trading session.

On Tuesday 15 Mar 2011, after Japanese Prime Minister Naoto Kan said a “substantial amount” of radiation was leaking from a nuclear power plant affected by the Mar 11 massive earthquake and tsunami, the floating losses on my Nikkei 225 long positions touched S$2.5 million, roughly twice more than what I had in my trading account. At the end of the trading session I made S$120K. It was the most frightening day in my life, more scary than the time I got robbed at gun point in Phnom Penh a few years earlier.

I continue to trade daily, with a S$100K account presently, focusing mainly on Nikkei 225 Index futures. My daily profit seldom exceed S$500 per trading day, nowadays.

I am 100% certain I can lose every cent in my trading account again.

Can I ask what sort of risk control you were employing at the time(s)? What were your position sizes like comparative to your account size?

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  #73 (permalink)
Always Learning
Tampa, FL, USA
 
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I have blown my account twice, both times trading forex. The amounts were $500 and $300.

I have also lost some money trading a cryptocurrency called Nxt. I bought around $1500 worth of Nxt and saw my investment go up to $4500 but did not sell out greed. I fell for all the hype that the price was going to sky rocket (think bitcoin). Of course there was a huge dump and the prices tanked. My initial investment was down to $600 when i sold.

Recently i opened up a futures account with $2000. I started to scalp, by the 3rd day i was up $280. Last Friday i screwed up, i experienced the same thing @Malthus mentioned. I had no control over myself and i kept making losing trades. I had told myself i would limit loses to $100/day, i ended up losing $900 in 20 minutes (trading CL).

I didn't take any trades this week and i won't be scalping anymore.

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  #74 (permalink)
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purveyor View Post
Recently i opened up a futures account with $2000. I started to scalp, by the 3rd day i was up $280. Last Friday i screwed up, i experienced the same thing @Malthus mentioned. I had no control over myself and i kept making losing trades. I had told myself i would limit loses to $100/day, i ended up losing $900 in 20 minutes (trading CL).

I didn't take any trades this week and i won't be scalping anymore.

Your first mistake was thinking you can trade futures with only 2k.

Your second mistake was trading crude. Seriously wtf...

Third mistake was trying to scalp.

Basically you did everything wrong so obviously you will lose money.

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  #75 (permalink)
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dark pool View Post
Do you personally know any successful traders(years)who have never blown an account? I've been reading/studying for half a year now, and it seems that blowing up an account is an active choice on the part of the trader. You have to willingly ram your face into a streak of losses to actually end up at 0 or below. I really don't understand that. Or is there just several trades where the trader decides to risk it all?

Yes many successful traders and investors that I know have never blown an account, these aren't full-time intra-day futures traders. To me it really comes down to money management, diversify risk across different asset classes, and most of all defining risk before a trade.

The equities and options market is complex with many different players with many different agendas. The percentage of retail traders trading the equities market daily is minuscule so I think the advantage is not from anticipating or predicting novice or rookies traders but more from trading a plan, finding value and longer term context for the equity. Besides that the amount of computer and brain power with gazillion PhD's at these institutional firms do I really think that I have advantage trading from my retail platform in my underwear, no not at all

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  #76 (permalink)
Always Learning
Tampa, FL, USA
 
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Thanks @Big Mike, I appreciate your comments. The three things you pointed are basic things that every trader should follow but it didn't seem to register in my head until it was clearly laid out in front of me.

For someone who's starting out i feel this experience gives me an clear indication of what assets to steer away from and that scalping does not suit my personality.

i hope my post will deter other beginners like me from making mistakes like these.


Last edited by purveyor; March 28th, 2015 at 02:09 PM.
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  #77 (permalink)
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Singapore Singapore
 
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dark pool View Post
Can I ask what sort of risk control you were employing at the time(s)? What were your position sizes like comparative to your account size?

You can ask and I will try to answer to the best of my recollection.

On the days or times that I blew my trading account or suffered huge losses, I have no risk control as I lost control.

Basically I am a day trader who scalps the futures markets with no hard stops.

On the days or times that I blew my trading account or suffered huge losses, my position size increased to the maximum limit that I am allowed to trade, with the available capital in my account.

On 15 Feb 2007, the day I lost S$191K trading SGX MSCI Singapore Index futures, I remembered I started shorting that contract after lunch when it started to move upwards one way, way beyond its normal range. I added to my small losing short position as prices moved higher and added more and more as I see bigger floating losses, until it hit my maximum limit. After the cash market closes in the afternoon, futures continue to move higher and my losses ballooned to more than I can stomach and I surrendered all my shorts in the T+1 (after cash market close, futures trading session) market which has not enough liquidity to absorb all my shorts, so I paid more for my losses which wiped out my trading account and made me a net loser after 2 years of hard work.

15 Feb 2007 was the day the Singapore budget was announced in the afternoon, and I was not aware of it. It caused the MSCI Singapore Index futures to move one way up, without meaningful pullback. My shorts that day would have given me S$2,000,000 profits about 2 weeks later, had I been able to hold on to them for that long.

On 30 Apr 2009, the day I lost S$224K trading SGX MSCI Taiwan Index futures, I remembered I started shorting that contract the previous night when I saw it moving so much higher than the cash market close. I carried my losing shorts to the next morning open on 30 Apr 2009 and had about US$10K floating profits which I did not take right after the cash market opens. When my floating profits turned into losses, I added more and more shorts until I ran out of bullets. I surrendered all my shorts as the cash market closes and lost S$224K. I revenge traded the next trading day and lost another S$116K and my trading account has a small negative balance.

On 16 Nov 2012, the day I lost S$570K trading SGX Nikkei 225 Index futures, I remembered the range for the OSE Nikkei 225 large futures contract was only 12 ticks, low 8910, high 9030. SGX Nikkei 225 futures contract which I traded that day had twice as many ticks (24) after the Japanese stock market opens at 8 am Singapore time. How could I have lost S$570K that day? Well, I traded about 10K lots (bought & sold) that day. I had about S$1.3M in my trading account and I have 1,200 lots limit for SGX Nikkei 225 contract on my X-Trader trading platform. I remembered holding 1,172 lots short at one time. I remembered seeing around S$100K loss in the beginning, and then around $200K loss later in the day and S$570K loss as I liquidated all my shorts at the close of the day trading session.

I remembered how I traded that day but I have no explanation why I traded the way I did. I find it extremely hard to accept that the person who traded that day was my true self.

Hope I answered your question.


Last edited by JacLau; March 28th, 2015 at 06:02 AM.
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  #78 (permalink)
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In every situation you were short. I'm wondering what percentage of trades and overall profit is from shorts?

Sent from my phone

Due to time constraints, please do not PM me if your question can be resolved or answered on the forum.

Need help?
1) Stop changing things. No new indicators, charts, or methods. Be consistent with what is in front of you first.
2) Start a journal and post to it daily with the trades you made to show your strengths and weaknesses.
3) Set goals for yourself to reach daily. Make them about how you trade, not how much money you make.
4) Accept responsibility for your actions. Stop looking elsewhere to explain away poor performance.
5) Where to start as a trader? Watch this webinar and read this thread for hundreds of questions and answers.
6)
Help using the forum? Watch this video to learn general tips on using the site.

If you want
to support our community, become an Elite Member.

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  #79 (permalink)
Elite Member
Neuwied Germany
 
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JacLau View Post
You can ask and will I try to answer to the best of my recollection.

On the days or times that I blew my trading account or suffered huge losses, I have no risk control as I lost control.

Basically I am a day trader who scalps the futures markets with no hard stops.

On the days or times that I blew my trading account or suffered huge losses, my position size increased to the maximum limit that I am allowed to trade, with the available capital in my account.

On 15 Feb 2007, the day I lost S$191K trading SGX MSCI Singapore Index futures, I remembered I started shorting that contract after lunch when it started to move upwards one way, way beyond its normal range. I added to my small losing short position as prices moved higher and added more and more as I see bigger floating losses, until it hit my maximum limit. After the cash market closes in the afternoon, futures continue to move higher and my losses ballooned to more than I can stomach and I surrendered all my shorts in the T+1 (after cash market close, futures trading session) market which has not enough liquidity to absorb all my shorts, so I paid more for my losses which wiped out my trading account and made me a net loser after 2 years of hard work.

15 Feb 2007 was the day the Singapore budget was announced in the afternoon, and I was not aware of it. It caused the MSCI Singapore Index futures to move one way up, without meaningful pullback. My shorts that day would have given me S$2,000,000 profits about 2 weeks later, had I been able to hold on to them for that long.

On 30 Apr 2009, the day I lost S$224K trading SGX MSCI Taiwan Index futures, I remembered I started shorting that contract the previous night when I saw it moving so much higher than the cash market close. I carried my losing shorts to the next morning open on 30 Apr 2009 and had about US$10K floating profits which I did not take right after the cash market opens. When my floating profits turned into losses, I added more and more shorts until I ran out of bullets. I surrendered all my shorts as the cash market closes and lost S$224K. I revenge traded the next trading day and lost another S$116K and my trading account has a small negative balance.

On 16 Nov 2012, the day I lost S$570K trading SGX Nikkei 225 Index futures, I remembered the range for the OSE Nikkei 225 large futures contract was only 12 ticks, low 8910, high 9030. SGX Nikkei 225 futures contract which I traded that day had twice as many ticks (24) after the Japanese stock market opens at 8 am Singapore time. How could I have lost S$570K that day? Well, I traded about 10K lots (bought & sold) that day. I had about S$1.3M in my trading account and I have 1,200 lots limit for SGX Nikkei 225 contract on my X-Trader trading platform. I remembered holding 1,172 lots short at one time. I remembered seeing around S$100K loss in the beginning, and then around $200K loss later in the day and S$570K loss as I liquidated all my shorts at the close of the day trading session.

I remembered how I traded that day but I have no explanation why I traded the way I did. I find it extremely hard to accept that the person who traded that day was my true self.

Hope I answered your question.

My stomach starts aching when i read this....with all respect, but this sounds like self destruction. I know this, too, but never in that dimension. I don´t think that this is the question of using a hard stop or not. It´s obviously more the question to admit to be wrong in that special moment. But finding oneself in a "bubble" stops acting adequatly...
Is this solvable?? Have you find a way already?

Waiting, Discipline and Patience Pays!

Last edited by pipandrun; March 28th, 2015 at 06:12 AM.
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  #80 (permalink)
Trading Apprentice
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Big Mike View Post
In every situation you were short. I'm wondering what percentage of trades and overall profit is from shorts?

Sent from my phone

For the 2 "Near Miss" situations where my floating loss exceeded my trading capital before the market recovered, I was long.

I am more comfortable being short than long when I trade.

I do not track what percentage of my trades and overall profit is from shorts or longs.

I started trading futures in mid 2004 as a retail trader and became an SGX local around end 2004. I started tracking my daily profits from 2005 but I do not keep records of each trade.


Last edited by JacLau; March 28th, 2015 at 08:25 AM.
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