Trading. By Winnie the Pooh
|November 1st, 2014, 06:36 AM||#1 (permalink)|
Futures Experience: Advanced
Favorite Futures: ES
Posts: 13 since Oct 2014
Thanks: 2 given, 13 received
Trading. By Winnie the Pooh
ďDonít underestimate the value of Doing Nothing, of just going along, listening to all the things you canít hear, and not bothering.ď
This is my trading journal, which I have named in honor of my favorite character, Winnie the Pooh. Pooh, if he had been a trader, would have been a genius. His mental state was perfectly tuned to trading. Humble and present, yet self aware enough to find the honey when he wanted it. That is how I want to trade.
I have been a student of the markets for decades and I must heave studied every investing and trading technique known. From deep value investing, through to picking apart HFT models. I can price exotic options and was working with asset backed securities well before they blew up the world. I have learned technical analysis and how to work out the value of a business. But I never settled.
Possibly because I was looking for the one technique that would suit me. They say trading is 95% mental and that is more than true. The books all tell you to find a technique that suits your personality, but its taken me almost 20 years to find that one. But fortunately, I have found it. And so begins the next stage of my journey. Like Winnie the Pooh, I am now in a state where I can simply wonder along, and wonder if it is going to rain, thinking about honey and every now and then get a little worried about Woozles, or some such. Trading, like life, is a flow.
This is not the beginning of my journey and its probably not even the middle. Its somewhere between early morning and lunch time. But it doesn't really matter, cause trading is simply a journey. So, we will simply pick up the journey from here. Today. Now.
Everything about my style is built to suit my personality and my life style.
I scalp trade stock futures (ES and Stoxx). Why? Because it suits me. My personality suits hard work. I come from a family where hard work at the office was what it took to succeed. I can't break that, so I have chosen to go with it.
It suits me to sit in front of a computer screen (I can play computer games for hours), and it suits my mental mind set. I am not the sort of person who can take large swings by investing for the longer term. But I can chip away, little by little, to grow my pile. I like to sleep at night and never could if I have tens of thousands riding on some adverse news from somewhere odd in the world.
I also "get" charts. I'm a very visual person. Don't ask me to recall streams of numbers, but I can see patterns in pictures. Hence chart patterns suit me. I don't use many indicators (usually just a MA and sometimes stochastics), but I do draw lines on my charts. I control my risk via the number of contracts I trade. Not many at once, sometimes just 1 sometimes up to 5, but each one chips away and adds to the pile.
Mentally, I enter a trade with a thought (such as its at resistance, its going to retrace, it will break out this time) and place my trade accordingly. Finger is always ready to close should I be wrong.
This is my style and my way. Its neither right nor wrong. It just is. You can make just as big a fortune doing the complete opposite of me. Its about how you approach things that matter. Its mechanical. Its sometimes boring. Its how I make money.
After 20 years, I am taking a new step.
Let the journal of Pooh begin!