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SoftSoap's NQ Journey - from SoftSoap to SoftGold


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SoftSoap's NQ Journey - from SoftSoap to SoftGold

  #291 (permalink)
 
SoftSoap's Avatar
 SoftSoap 
Canada
 
Experience: Beginner
Platform: NinjaTrader
Broker: InteractiveBrokers
Trading: NQ
Posts: 594 since Aug 2015
Thanks Given: 347
Thanks Received: 1,227

My current broker is InteractiveBrokers and they have a portfolio analyst tool that provides me with some metrics. I don't use this as often because I want data that helps me identify where my problems are so I can fix them, and this just doesn't do the job for me.

However, seeing as how we are at the end of the year, I thought I would share because it is good to review this every now and then.

Something to note - The numbers in my FIO journal might be slightly off from what the broker has, but the right data is from the broker. I check my data every day / week / month for any discrepancies and try to fix them. However, sometimes it's hard finding where the $12 different in 100 trades was, so I don't bother. The numbers should be pretty close though.

General overview


  • Cumulative return @ 42.16% return, I'm obviously very happy about that.
  • Best return was the day after election night where I made 16%, just insane.
  • Worst day was August 25th on the week I started my journal, and I'll get into more detail about how this one day, led to my huge drawdown on a future post

Time period performance
This is my day-to-day returns



I've been going back and reading my old posts and I figured that breaking it into 'periods' %-wise, would help me connect the qualitative part of my journal (FIO) with the quantitative piece (IB)



Cumulative Benchmark Comparison

This is the cumulative performance using the 3 major indices
I'm not sure if I chose the 3 right indices, so if I'm supposed to benchmark vs another one, please let me know so I can change it in the future.

Similar to the picture above, I start out strong, get into a prolonged drawdown, and then break out and trend




Risk Analysis
There's some interesting stuff here. I'm a person that puts risk management at the forefront of my trading so I would expect that my results would show that.


  • Max drawdown @ 17.59%, wow that is big. This is something that I need to work on. If i had a sub-20% drawdown with a 70%+ ROI then I would be ok with that, but honestly 17.5% but with a 40% ROI seems like a big ratio.
  • It took me 26 days to recover from my biggest drawdown, and that's not calendar days. That is a pretty long stretch and honestly I don't want to have a drawdown that long ever again. It felt like an eternity! This was very taxing on me and I want to understand it more so that I can prevent it in the future. I will dedicate a post strictly to analyzing this drawdown in detail.
  • Sharpe Ratio 2.63. Doesn't mean much to me, to be honest. Investopedia says over 2 is really good, but why? I know that the election skewed this so is that even worth taking into account?
  • Sortino ratio, again doesn't mean much to me. 6.81, is that good? I haven't read up on this one as much and didn't find information too easily. It's out there, but honestly I just haven't bothered to look past the first google results page
  • Calmar ratio. I'm seeing that 6+ is excellent, and I have 13? But what about my trading is excellent? I'm also seeing that this is a 36month+ indicator, so maybe I shouldn't put any emphasis on this. It's probably like expectancy where 1 day can net you an expectancy of 500 but over a year your expectancy might be 10.
  • Standard deviation and downside deviation, I know what a standard deviation is, but what what does it mean in this context? Is this a deviation from my ratios? my VAMI? My mean return? My trading account?
  • Mean return aligns with what I have on my spreadsheets
  • Positive periods vs negative periods. Wow this is a surprise! I honestly thought I lost more days than I won, seeing as how I win ~30% of the trades I take. But that isn't the case, I actually have more positive days than negative days, neat!

So with all these ratios, do I even have enough data? It's about 5 months and ~500 trades, but do I need years worth of data for these to be meaningful? What do they tell me? Am I good at risk management? I think I am and these numbers sound like they show that, but that's as far as I get. Either way, I'm not going to put too much emphasis on these. If they are good then great, it's something to benchmark myself with for the next 5 months.
If someone who is more comfortable with these type of ratios could chime in, that would be amazing!


Risk Analysis vs S&P, DOW, and Nasdaq



  • I obviously had a much higher drawdown than they did, about 3-4 times as large. However, my net ROI% was ~ 4-8 times as large
  • Recovery compared to the Nasdaq was very similar, 26 vs 27, but during very different periods
  • Sharpe ratio is better than 2/3
  • Sortino is better than all 3
  • Calmar ratio is better than all 3
  • Standard deviation and downside deviation, I don't know if it's better or worse than all 3
  • Mean return is better than all 3
  • Positive/negative period ratio is better than all 3

Does this tell me that from a risk/reward standpoint I performed better than the 3 major indexes? It depends on what is important to you I guess.
If it's the Net ROI % then yes, if it's the Max drawdown% then no, if it's one of the 3 ratios then yes. But why? What should I be doing more? What should I be avoiding? The only thing I get from this is that my risk/reward ratios pay off, and that my drawdowns can be long and big.
However, I think as time goes by and I learn more about these ratios and what all of the data really means then I can say whether or not I performed better than them from a risk/reward standpoint.

My thoughts on the report
If I'm going to look for investors at some point in the future, these are probably the type of numbers they are used to seeing. They don't help me pinpoint where I need to improve, but they are a good snapshot of past performance. Overall, I think there's enough good information on these reports that they are worth analyzing every 3-6 months. Also, the effort to run them is minimal, so why not?

Cheers!

Yesterday's excellence is today's standard and tomorrow's mediocrity
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  #292 (permalink)
 
SoftSoap's Avatar
 SoftSoap 
Canada
 
Experience: Beginner
Platform: NinjaTrader
Broker: InteractiveBrokers
Trading: NQ
Posts: 594 since Aug 2015
Thanks Given: 347
Thanks Received: 1,227


Blash View Post
I find thoughts to be like waves on an ocean or the current of a river, never ending, always coming at you, a force of nature. Meditation as I practice/understand it is the taming of this force. Turning the field over run with weeds into a garden. Harnessing the rivers current.

Developing the ability to still these thoughts and focus/project them onto a singular "thing", entity or hold still one idea.

Communing with self you can put questions to it (your essence) and get back the answer in time. Whatever you concentrate on you draw to yourself. If you force your energies on your debt in a unhealthy way you get more of it. Focusing on generosity gives you what?

Ron


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Inspiring words.
Thanks Ron!

Yesterday's excellence is today's standard and tomorrow's mediocrity
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  #293 (permalink)
 
SoftSoap's Avatar
 SoftSoap 
Canada
 
Experience: Beginner
Platform: NinjaTrader
Broker: InteractiveBrokers
Trading: NQ
Posts: 594 since Aug 2015
Thanks Given: 347
Thanks Received: 1,227


In case anybody is wondering, I plan to start trading again as of January 9th. I might take some swing trades in the next few days if the jobs report or FOMC minutes call for it, but that would be out of plan. I'm currently working on creating 2017 spreadsheets, doing some 2016 analysis, putting my goals together, and catching up on sleep.

I'll be sharing some of the analysis on FIO, so stay tuned!

Yesterday's excellence is today's standard and tomorrow's mediocrity
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  #294 (permalink)
 
SoftSoap's Avatar
 SoftSoap 
Canada
 
Experience: Beginner
Platform: NinjaTrader
Broker: InteractiveBrokers
Trading: NQ
Posts: 594 since Aug 2015
Thanks Given: 347
Thanks Received: 1,227

If you follow my journal you know that I like to do some more in-depth analysis on a monthly basis. It was time to do my first fiscal-year end review!

I'm a big believer in continuous improvement, and I don't think you can continuously improve as much if you don't look at your past in a meaningful way. This is my attempt of looking at things in a meaningful way, so that I can improve.

The posts are usually long (and even longer this time), but I promise you it's worth it!

Overall stats


  • ROI % dropped a little from the time I posted the broker information as some of my trades after that didn’t work out , but not by too much
  • Win % is lower than I would like it to be, but it gives me a starting point
  • Payoff Ratio is something I’m happy with as it’s more than 2.5
  • Expectancy is relatively low to be honest. My account size is small so I expected it to be small but I would like it to be much higher than this
  • Talked about Avg R on broker information
  • Max Risk was 2.01%. This was on election night and OUTSIDE of election night my risk has not gone above 1%. Yes it’s a big mistake to go over and it did break my golden rule of not risking more than 1% per trade and I made a ton of mistakes that night
  • Average R/R is quite high, I wonder how this is hurting my win %. Do I aim for too high of wins? Or is this good and I’m just taking too many bad trades? Not sure to be honest, but something I will focus on next year to find the answer. The question is how? Any suggestions would be greatly appreciated
  • Max DD I’ve already talked about
  • Average DD seems quite high. But I don’t know to be honest because how much did my prolonged drawdown influence this? Not a metric I’m too comfortable with on a longer-term I guess
  • SQN I just use it because it’s tracked on my spreadsheet, but I haven’t dug into the details of it
  • # of trades is quite high though, I would like to take less trades in 2017. Keep in mind that this is an average of 115 trades a month. Yikes

Something that isn’t above but I found interesting was the Average win and average loss $-wise. These numbers are net so they have already taken commissions into account.
  • Average win is $243.71 or ~12 pts
  • Average loss is $92.39 or ~4.5 pts
This is very close with what I ‘aim’ for, and while not exciting to look at. It shows that my trades are relatively consistent with what I’m aiming for. Good thing I guess?

Overall stats – Month over Month

  • 4/5 months were positive, I gotta be thankful for that
  • Win% fluctuates between 22% and 36%, again something I’d like to work on
  • Average R/R never drops below 3.36
  • However, Payoff Ratio does drop below 2 on the month where I did bad. Meaning my wins weren’t able to compensate for my losses. This is due to me being in ‘drawdown mode’. I get comfortable taking losses, but I start taking smaller wins in case the market turns around on me, so I go against my edge. Making a big difference ROI and expectancy wise
  • December wasn’t that great for me, but I managed to still end positive, so I can’t complain there as I still learned a decent amount about myself in the process.





Just going to highlight key things from these charts. If you spot something that you think I should highlight please feel free to comment!
  • November is an outlier in regards to ROI %. This is due to the high volatility during and after the election. High volatility goes well with my system because I can aim for much bigger wins while still keeping my risk low. I just need to have really good entry points for that strategy to be successful though
  • The losing month was much bigger than my non-November winning months, something to watch out for in the future
  • Average of trades per month is ~115 which is much higher than I would like it to be. The trend was moving down as I focused on my FOMO but after the high volatility in November I was like a kid the first time trying candy. It was hard to ground myself after so I will have to keep working on this as I don’t want it to carry on for much longer. I need to press the buy/sell button less
  • Despite only winning 25% in December, I managed to stay above ground but I was 3-5 losers in a row away from that. This tells me that a minimum of 25% can be do-able, but is by no means what I want to aim for. However, it will be a good reminder for the days where I get a subpar win% so that I don’t spiral out of control

Overall in detail

Some of these numbers might not add up as my data quality isn’t @ 100%, but for the most part it should be quite close.
Long VS Short



This shows I’m slightly more of a bear than I am a bull, not what I expected
Since August the market has been mostly bullish so I guess I should be happy that I managed to make money mostly shorting on a mostly bull market. Can’t wait until I short more in a bear market, or long more in a bull market
Apart from that, the numbers are pretty close, win% difference is only 2 between the 2, and payoff ratio is only 0.08 difference.

Day of the week


Tuesday was election night and I took ~100 trades then so although it’s the day I traded the most, it would be an average day if the election wasn’t that night. However, Friday is the day I trade the most outside of that, which is actually very surprising.

Expectancy-wise my best days are Monday and Thursday, but why? Anyone have any input as to what I should consider to get the answer? Thursday there are usually more news reports so that adds volatility, so that should make sense. But Monday? Monday is usually not that volatile is it?

HOWEVER, this is purely anecdotal and I have no evidence to back it up. I think in the future I would like to do a ‘day analysis’ on the NQ itself.

Direction of trade


Well, at first I thought I was the best at trading against the trend and expecting a reversal. My numbers show that I’m not as good as I thought on this

Also, this shows that I should never trade in a sideways market. 14% win ratio and 1.03 payoff ratio leads to an expectancy of -56.49. Yeah no thanks. I think I will add this to my daily psychology goals in the future.
24% of the trades I didn’t include which direction, so I also need to get better with my data quality

Decision Type


If you have ever asked yourself “I wonder if SoftSoap makes money when he trades with his emotions”. Wonder no more, the answer is absolutely not

As to rational/mixed, this is a metric I’m going away with in 2017. Sometimes you gotta try something and see what works. Tracking emotional trades will stay because it’s something that I clearly need to avoid. However, as time went by and most of my trades became deliberate, I found it very difficult to decide whether a trade was ‘rational’ or ‘mixed’. So why track something that you don’t even know if you’re inputting properly? I’ve got something in mind in terms of what I will replace this with, but nothing set in stone just yet.

Time of Day



This was a bit of a surprise. I expected to do better in the morning, but I did NOT expect mostly lose money in the afternoon. Wow. I should probably consider throwing in the towel @ 12 EST and only come back if a strong area has been hit. A reason as to why I don’t do well could be because I create a detailed plan every morning on what I can expect on first contact. However, 3 hours after the market opens the plan might not be as relevant as it was 3 hours prior. Also, the volatility and volume is lower in the afternoon, and my numbers show that I do better on higher volatility environments. Something to note and keep track of in the future, as I will need to tweak something up if I want to trade the afternoon.

Something else I want to highlight, is that I’ve done a similar table in the past and it showed that I did bad from 9:30-10:30. Since then I added a psychology goal that states I need to be more cautious during the first 60 minutes of trading, and it seems to be paying off. 9:30-10:00 is still when I take the most amount of trades, but I’m positive on those now. 10:00-10:30 is when I have my highest expectancy. This is likely because the market has settled enough that you can get a good gauge of where the trends will go, and there won’t be as much volatility as during the first half hour. Good thing to note as I should be watching the market around that time

As for the high number of Overnight trades, most of those were from election night


Trading Errors


The 5 biggest contributors to my losses are
  • Bad Read- I’m wrong. I thought something was going to happen and the market proved me wrong. These are the errors that you should expect and as you improve as a trader you should make less of these.
  • FOMO- Fear of Missing Out. The market is moving fast one way and I NEED to get in there.
  • Bad Entry Points- My hypothesis on the trade was correct, but if my entry point was modified slightly (usually within 2.5pts), I would’ve walked away with a win instead of a loss
  • Forcing- “The market is going to go my way because that’s the only logical thing. So if I’m bullish I will keep on buying because the market should be bullish”. That’s pretty much what that is to me lol.
  • Too Early- I see the market environment changing and a decent move about to happen. But I can’t wait for the market to stabilize so I just get in right now, usually with a market order or I move my limit order to the price level. This might sound similar to ‘bad EP’, but the key difference is that this is TIME-bound, while bad Entry point is PRICE-bound.



I wanted to show a pareto chart excluding Bad Read as that is something I feel will improve with my experience. Whereas the rest of my errors I can do things to prevent them. Ex, I can’t just become a master at reading price action from one day to the next, but I can set systems in place so that if I shorted 3 times after the market keeps going up, I stop so I don’t dig myself into a deeper hole (forcing error).

The top 4 errors account for almost 70% of my $-losses. This is where my time will be better spent mitigating these errors.


Trade Grade
This was the most difficult thing to find a way to show in a meaningful way. It’s also a metric that I didn’t track in August so it doesn’t have as much data as the others.

Here’s a reminder of what my trade grades represent. You can call it Really bad – Excellent, or you can call it 1-5, but the details is what matters.


Quoting 
Trade grade – Really bad
  • Not in plan
  • Knew I shouldn’t have entered or Past my trade limit
  • or I made some execution mistakes on a ‘bad’ trade
Trade grade – Bad
  • Not in plan
  • Bad entry point or target
  • Feels like a gamble
Trade grade – Ok
  • It may or may not have been part of my setup plans but at least aligned to my scenarios
  • Some signs were there
  • Decent (but not good) target and/or stop
Trade grade - Good
  • It was in the plan
  • Observed signs of entry
  • Good target and stop
Trade grade – Excellent
  • It was in the plan
  • Observed signs of entry
  • Good target and stop
  • Everything a good trade has but also adapted to the market either by modifying entry for better potential, and exited early/late depending on the market conditions

I want to emphasize the fact that this has no correlation to whether I won a trade or not. I won’t turn a trade where I knew I shouldn’t have entered, and made some bad executions into an ‘Excellent’ trade just because it made me money. I have really bad trades which make me money, and I have excellent trades which lose me money.





The correlation from how well I trade to how much $ I get back is a lot stronger than I thought it was going to be.

Excellent trades make sense that they have a high gain%. These are trades that were ‘Good’ but became excellent because I either got a better entry point, I got out of the market as conditions changed, or I moved my target up for a much bigger win. However, what surprised me about this is that I made more money than all the other trades, despite only accounting for 6% of my overall trades.

Now, I’m not aiming for all my trades to be excellent. Excellent shouldn’t be the norm because it’s me taking advantage of an out-of-norm situation. Good trades need to be my norm.





I found this data so difficult to show in a meaningful way. So I decided to just show the 3 best charts I could come up with. If anyone has any suggestions, they would be greatly appreciated


Less than 25% of my trades are Excellent/Good. That’s not a good trend. While 44% of my trades are either bad or really bad. I need a lot of focus on this so that I can improve my trading.
I think this is how I would like my performance to look in the future.
  • Excellent – From 6 to 10%
  • Good- From 17% to 50%
  • Ok- From 33% to 30%
  • Bad- From 23% to 8%
  • Really bad – From 22% to 2%



Clearly, I have a long and treacherous road ahead, but hey that’s good right? It just means I have so much room to grow as a trader!!!

Overall thoughts
I’m so young into my trading career that I don’t have anything to benchmark this 5 months to. However, this gives me a good starting point for next year, and it will be something I reference a lot in the future.

It takes a lot of work to put this together, specially because you guys are just seeing the things that made sense. You aren’t seeing all the things that didn’t add much value or just didn’t show anything worth talking about. There was a lot of effort put into things that ended up just being a waste of my time lol. However, I believe that to improve as a trader, you MUST conduct these types of analyses on a regular basis. Broker information as what I have above is nice and easy, but it doesn’t help you pinpoint WHERE you need to focus to improve. This data does.

Past performance analysis is nice, but how will you improve from this?
So as part of my ‘improvement’ process, once I identify what my trading weaknesses and strengths are, then I can set proper goals to improve my trading performance. This takes some thinking on what the best way will be to do it, but my 2016 Goals and Objectives should list plans in place to address most of my issues, while leveraging my biggest strengths. So stay tuned!

Cheers.

Yesterday's excellence is today's standard and tomorrow's mediocrity
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  #295 (permalink)
 WOW CO 
Toronto, Canada
 
Experience: Beginner
Platform: Ninjatrader
Trading: ES
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Thanks Given: 1,712
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SoftSoap View Post
If you follow my journal you know that I like to do some more in-depth analysis on a monthly basis. It was time to do my first fiscal-year end review!

I'm a big believer in continuous improvement, and I don't think you can continuously improve as much if you don't look at your past in a meaningful way. This is my attempt of looking at things in a meaningful way, so that I can improve.

Interesting analysis, thanks for sharing.

A couple of questions
- the 44% total for 'bad and really bad' trades - did this percent get better over time once you started engaging in deliberate thinking for your trades and tracking psychological goals? Although 5 mths is probably a bit short for meaningful data to determine the trend

- if you take the few days after the election out of the count for the 'bad and really bad' trades percentage, does the percentage change a lot? I seem to recall that right after the election you were off your game for a few days, expecting volatility to continue and trading as such.

Edit -
Forgot to mention 'decision fatigue' could be a factor in your afternoon results. I have heard the same thing from other traders - morning is great, afternoon not so great.

@SoftSoap

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  #296 (permalink)
 
SoftSoap's Avatar
 SoftSoap 
Canada
 
Experience: Beginner
Platform: NinjaTrader
Broker: InteractiveBrokers
Trading: NQ
Posts: 594 since Aug 2015
Thanks Given: 347
Thanks Received: 1,227


WOW CO View Post
Interesting analysis, thanks for sharing.

A couple of questions
- the 44% total for 'bad and really bad' trades - did this percent get better over time once you started engaging in deliberate thinking for your trades and tracking psychological goals? Although 5 mths is probably a bit short for meaningful data to determine the trend

- if you take the few days after the election out of the count for the 'bad and really bad' trades percentage, does the percentage change a lot? I seem to recall that right after the election you were off your game for a few days, expecting volatility to continue and trading as such.

Edit -
Forgot to mention 'decision fatigue' could be a factor in your afternoon results. I have heard the same thing from other traders - morning is great, afternoon not so great.

Interesting question, and I'm glad you asked. It showed a gap in my analysis which in retrospect is so obvious, so thanks!

I don't have a lot of data before I started adding deliberate thinking to my psychology goals unfortunately. Here's what I was able to put together with the data that I did have.

Before my post on September 19th
  • Looking back I only have 16 days of data prior to my post as the first 4 weeks I did not grade my trades
  • 2/16 days were perfect days, where I had 0 bad or really bad trades (12.5%)
  • In those 16 days I took 76 bad or really bad trades, out of 124 trades taken during that time. Crazy right?
  • Meaning that 61% of the trades before were "bad" or "really bad"

After my post on September 19th
  • I have 54 days of data where I traded, and graded my trades
  • 27/54 days were perfect days, where I had 0 bad or really bad trades. This means that half my days were perfect, which is 4x as large as before I started tracking deliberate thinking in my psychology goals
  • I took 70 bad or really bad trades, out of 230
  • Meaning 30% of my trades were bad or really bad. This is half the percentage, and it is also less "bad or really bad" trades #-wise with more than 3x the days.

Keep in mind that the number of trades here does NOT include election night, as I was trading so fast that I did not sit down and grade my trades as things were happening. You could say that because of the number of trades I took that night (~100), all of them were 'really bad', but all that would do is skew the rest of my data and tell me something that I already know (I traded really bad during election night).

So with the data you could come to the conclusion that engaging in deliberate thinking before my trades, led to less "bad" and "really bad" trades, which is what I was aiming for.

But one thing I want to add is that taking more deliberate trades made a big impact in the number of trades I took. Looking at my journal posts, I started passing up a lot more trades once I started engaging my deliberate thinking. Some of this was due to the fact that I missed a short window as I was consciously thinking about whether or not to enter, and some of it was due to the fact that I consciously made the effort to pass up on "bad" and "really bad" setups.

Having said that, I think that if I didn't start putting a high emphasis on my psychology goals, that my % of "bad and really bad" trades would've been much higher. How many "bad" and "really bad" trades did I avoid by doing this? How much money did it save me? Honestly I don't know because that isn't something that I tracked, but I sure wish I did

Your 2nd question also sparked me to dig in deeper around this topic, but I'll have to post the answer and analysis later as I'm a few hours in and really tired.


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  #297 (permalink)
 
SoftSoap's Avatar
 SoftSoap 
Canada
 
Experience: Beginner
Platform: NinjaTrader
Broker: InteractiveBrokers
Trading: NQ
Posts: 594 since Aug 2015
Thanks Given: 347
Thanks Received: 1,227


SoftSoap View Post
Interesting question, and I'm glad you asked. It showed a gap in my analysis which in retrospect is so obvious, so thanks!



I don't have a lot of data before I started adding deliberate thinking to my psychology goals unfortunately. Here's what I was able to put together with the data that I did have.



Before my post on September 19th
  • Looking back I only have 16 days of data prior to my post as the first 4 weeks I did not grade my trades
  • 2/16 days were perfect days, where I had 0 bad or really bad trades (12.5%)
  • In those 16 days I took 76 bad or really bad trades, out of 124 trades taken during that time. Crazy right?
  • Meaning that 61% of the trades before were "bad" or "really bad"



After my post on September 19th
  • I have 54 days of data where I traded, and graded my trades
  • 27/54 days were perfect days, where I had 0 bad or really bad trades. This means that half my days were perfect, which is 4x as large as before I started tracking deliberate thinking in my psychology goals
  • I took 70 bad or really bad trades, out of 230
  • Meaning 30% of my trades were bad or really bad. This is half the percentage, and it is also less "bad or really bad" trades #-wise with more than 3x the days.



Keep in mind that the number of trades here does NOT include election night, as I was trading so fast that I did not sit down and grade my trades as things were happening. You could say that because of the number of trades I took that night (~100), all of them were 'really bad', but all that would do is skew the rest of my data and tell me something that I already know (I traded really bad during election night).



So with the data you could come to the conclusion that engaging in deliberate thinking before my trades, led to less "bad" and "really bad" trades, which is what I was aiming for.



But one thing I want to add is that taking more deliberate trades made a big impact in the number of trades I took. Looking at my journal posts, I started passing up a lot more trades once I started engaging my deliberate thinking. Some of this was due to the fact that I missed a short window as I was consciously thinking about whether or not to enter, and some of it was due to the fact that I consciously made the effort to pass up on "bad" and "really bad" setups.



Having said that, I think that if I didn't start putting a high emphasis on my psychology goals, that my % of "bad and really bad" trades would've been much higher. How many "bad" and "really bad" trades did I avoid by doing this? How much money did it save me? Honestly I don't know because that isn't something that I tracked, but I sure wish I did



Your 2nd question also sparked me to dig in deeper around this topic, but I'll have to post the answer and analysis later as I'm a few hours in and really tired.






One thing I want to add is that correlation does not mean causation!




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So with the data I have we were able to come to this conclusion


Quoting 
After my post on September 19th
• I have 54 days of data where I traded, and graded my trades
• 27/54 days were perfect days, where I had 0 bad or really bad trades. This means that half my days were perfect, which is 4x as large as before I started tracking deliberate thinking in my psychology goals
• I took 70 bad or really bad trades, out of 230
• Meaning 30% of my trades were bad or really bad. This is half the percentage, and it is also less "bad or really bad" trades #-wise with more than 3x the days.

However, that was looking at things on a day-to-day basis. I wanted to dig in further and see if this also added up on the ‘big picture.

So I looked at things on a week-to-week basis, and as a % of my overall trades, and I was honestly surprised.





The picture doesn’t show a big improvement on this issue, so have I actually improved?
I know that being more deliberate meant taking less trades, so if I'm taking 8 trades instead of 50 in one week, and 4 of those are bad then the % is going to be a lot higher just due to a lack of data.

Let's see.



So here you see a lot more blue than orange as time goes by, and it makes sense. But still, on a week-to-week basis the ratio is high. Let's try to graph things differently and see if anything else becomes apparent.




Here I add some time periods so you can see the changes.




Looking at this, the answer is yes @WOW CO, if I took out the period that you are referring to, my ratio would be better. But does the overall trend points a bleak future?




So you can see that the overall trend decreased big time, then started going up, with having 2 days near the end of the year where things peaked. Now I know I didn't do as well near the end as volumes starting significantly dropping, but I didn't feel I did as bad.


And then it hit me. On December 5th I made a change to how I grade my trades, whereas any trade that was over my “trade limit of the day” would be classified as a really bad trade regardless if it met the characteristics of “good” or not. This is because I found that there are a few days that wreck my months and I want to avoid those.

So naturally the number of “really bad” trades will go up as I struggle to improve this.


Some graphs and lots of words, so what does tell you?

Again we can say that engaging in deliberate thinking had a strong positive correlation to my trading. However, the week-over-week data shows little improvement on that basis, although the data points might be too small for things to be statistically significant. However, I need more consistent data to measure how well I have improved. I made changes recently and that's going to have an impact on the number of "really bad" trades recently. Due to that, I can't confidently say that I am improving over time, or not. I'll have to wait a couple more months to truly get an answer on this

One thing I'm also noticing is that half the time I have "perfect days" in regards to my trade grades, and on most days I take less than 3 bad or really bad trades. However, there are those few days in a month where I struggle with my emotions and I take bad trade after bad trade after really bad trade...

Those are the days I have to avoid, and those will have the biggest impact on my overall trading.

This puts a higher emphasis on my "silver risk management rules", as they state the following in regards to "bad" and "really bad" trades.


Quoting 
  • If you execute a 'bad’ trade, walk away for 5 minutes
  • If you execute 1 ‘really bad’ trade, walk away for 15 minutes

I might need to consider drawing a limit of 2 bad and/or really bad trades in a day and walking away if that happens.

You've given me more to think about
Cheers!

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I should add that I'm hitting a bit of analysis paralysis so I might've not mentioned everything or wrote things in a way that didn't make sense. If there are any questions to my post above just let me know, but I think I'm done with analyses and graphs at least for now

Now to work on my performance improvement plans based on those analyses!

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Sorry about the late reply @Mtype, was out for the weekend.

The tracking part itself is honestly very easy and it doesn't take a lot of time. What takes longer is the analysis part, but for something simple like trading errors it shouldn't add more than seconds per trade to your daily routine.

The practical implementation would be that it allowed me to see the "big picture" when it comes to my trading. By doing that, I can see where I need to focus my attention on in regards to performance improvement.

For example, when I started trading I noticed that FOMO was one of my biggest issues (due to tracking this on my spreadsheets). I did a brief Root Cause Analysis (RCA) to try to understand better why I suffer from FOMO so much. There were many reasons of course, some are obvious and some are not. For example, I found that because I'm used to "being busy" at my old job, if I wasn't in a trade I felt that I couldn't be productive so I must always be in a trade. This is obviously a very flawed way of thinking, and it's not one that becomes obvious as I'm trading. However, once you can understand things then you can improve your trading!

This led to me changing 2 on my trading:
  1. Adding a daily reminder that I don't need to be in a trade to feel productive while trading. This is part of my psychology prep which I don't post on FIO, but it's just a list of things that I want to remind myself of every morning.
  2. Setting a daily psychology goal to avoid taking FOMO trades. This puts a heavier emphasis on not just the 'why', but the 'what' as well.

As I went by and I kept applying these 2 'changes', FOMO was no longer my biggest error and I have not lost as much money due to FOMO as I did during my first few months.

Hope that helps.

Cheers.

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