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Zen & the Art of The Small Account


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Zen & the Art of The Small Account

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  #171 (permalink)
 PandaWarrior 
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Its not what you think!. I had a great day today. Last night I spent some time "developing" a name and some nomenclature for what I do. Then spent the first 30 minutes of the morning talking to my trading buddy about strategy. More later about why I think this is important. But for now, just know I missed the entire first run up after the early sell off.

Then there was no man's land. No trading. I've decided there is a period of price action that deserves to be sat out. It's the transition between the moves. You'll see it on my chart.

Then started looking for the short I knew was coming. It set up earlier than I thought it would and so I actually passed on the first entry as I thought it was false signal. Two more opportunities presented. I took them both and due to there not being any real logical place to put the stop, I guessed and of course got stopped out both times. Down $224 after two trades.

Immediately after the second stop, the real entry showed itself, I entered on a sell short and my newly developed trading plan called for at least a 20 tick move and perhaps much more. So upon entering, I set the stop at its proper location, and then moved my target to the most logical place I could find. 40 ticks away. Trail stop set to kick in at 15 ticks.

All was good, prices falling like a brick, trailing stop about to kick. Prices moving lower. 14 ticks on the P&L. I am excited. Trading plan validated. Content to sit back and let the ATM do its work.

Disaster strikes. I get an "invalid order" from my broker. It fired just after my trail stop kicked in. I clicked ok to get rid of it and the trail stop moves again, same error. click. Trail stop moves again. Same error, click.....4 times this happens. I am freaking out. I decide to just close the position and figure it out. I hit the close button. Nothing happens. Oh crap! CRAP CRAP CRAP. I hit it again and again. Finally the position closes. 23 ticks of profit. I am break even for the day. Whew!

Oh HOLY MOTHER OF GOD CRAP!. There is a BUY stop on the screen. I only want to be short. Where the HELL did that come from.

Click cancel. Nothing happens. CRAP CRAP CRAP. Click click click click click............maybe a dozen times. Nothing happens. Speed dial broker. He answers on first ring. Thank god. He cancels order. WTH happened here. He says its a ninja problem. I believe him.

Decide to take my kid to her school open house then a movie. I'll deal with this when I get back.

Back home now:

Sent an email to broker to find out what the invalid order type was. Still waiting.
Sent email to Ninja with a screen shot with the BUY stop on the chart asking what the heck? Still waiting.

The good news:

I finished my first week of live trading up $55.
There was no jackhammer heartbeat and no jittery hands today. Well at least not during "normal" trading.
Trades were entered and stops taken with no anger, bitterness or remorse. Just kept looking for what I knew was the right set up.
Managed each trade pretty well considering.

Stats for the first week:

29 trades
16 winners
13 losers
Win rate of 55.17%

Had I held my winning trades to target, I would have had a great week. But overall I am extremely happy with the week. My wife thinks I am crazy to be happy over $55. But although she understands what my goals were, she doesn't really understand why cash is so much different than sim.

School starts next week. I'll have more time to study trading, write a post about distilling your method to a system, and start reading a couple of books. I am also going to work on a personal schedule with more routine built in and finalize my LLC stuff.

Have a great weekend. And be suspicious of this Ninja guy.....I think they are out to get us! ...just kidding but it sure seemed that way today.

Simplicity is the ultimate sophistication, Leonardo da Vinci


Most people chose unhappiness over uncertainty, Tim Ferris
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  #172 (permalink)
 traderwerks   is a Vendor
 
 
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aztrader9 View Post


Disaster strikes. I get an "invalid order" from my broker. It fired just after my trail stop kicked in. I clicked ok to get rid of it and the trail stop moves again, same error. click. Trail stop moves again. Same error, click.....4 times this happens. I am freaking out. I decide to just close the position and figure it out. I hit the close button. Nothing happens. Oh crap! CRAP CRAP CRAP. I hit it again and again. Finally the position closes. 23 ticks of profit. I am break even for the day. Whew!

Oh HOLY MOTHER OF GOD CRAP!. There is a BUY stop on the screen. I only want to be short. Where the HELL did that come from.

Click cancel. Nothing happens. CRAP CRAP CRAP. Click click click click click............maybe a dozen times. Nothing happens. Speed dial broker. He answers on first ring. Thank god. He cancels order. WTH happened here. He says its a ninja problem. I believe him.

You didn't happen to save your log file did you ?

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  #173 (permalink)
 PandaWarrior 
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traderwerks View Post
You didn't happen to save your log file did you ?

Yes and on the way to Ninja already. They are recommending I upgrade to b19 to solve any issues. And taking no responsibility for what happened. The invalid orders did originate from my broker, but the buy stop? Who knows. Now communicating with broker over scenario.

Will post results.

Simplicity is the ultimate sophistication, Leonardo da Vinci


Most people chose unhappiness over uncertainty, Tim Ferris
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  #174 (permalink)
 PandaWarrior 
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Currently upgrading to b19. When will NT be out of beta? Next decade sometime I suppose.

Simplicity is the ultimate sophistication, Leonardo da Vinci


Most people chose unhappiness over uncertainty, Tim Ferris
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  #175 (permalink)
 itrade2win 
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Platform: Sierra Charts, TOS
Trading: E-mini S&P 500
 
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aztrader9 View Post
Here goes....

So my account size started at $5,000. Its all I had left after a 15 year mortgage career that both made me almost "rich" and then took it all away. I got close. I made over 2 million dollars over a 6-7 year period. I owned commercial real estate, no debt other than my house, traveled a lot and gave a lot of money away.

But when the real estate collapse happened here in Arizona, it took my brand new mortgage office I had just opened with $250,000 of borrowed money and flushed it down the toilet. I lost the mortgage business, an Allstate insurance agency I owned, $1,000,000 of commercial real estate and filed a business BK to keep the creditors from taking everything else. I got off easy. Many of my friends lost their wives, their kids and one guy I know was homeless for a bit. I managed to keep those things and my health as well. I am fortunate!

I tell you this so you know where I am coming from. I know how to make $25-40K a month. I've done it once and I think I can do it again. The first time I did it, I did it in a business I knew nothing about but learned very rapidly. Just like in trading, the mortgage business was all mental.

The account size is no longer $5,000. I have refunded it a couple of times over the last year. The guy that got me into trading said it would take $10,000 and a year to "get it" and become profitable. It has taken every bit of that.

But I thought I was too smart for that. After all, I was in financial services, I traded interests daily and was very good at it. But my time horizon was always a month out, so I guess you could say I was swing trading rates. Trading against the customer that is.....so I figured I could do it in 6 months. LOL....that is funny. Shows you what being arrogant will get you. Frustration in spades.

Fast forward 16 months to today. I am finally beginning to show some consistency on sim. I decided to trade my small sim account as though it were my actual account for a month. In other words, if I could develop an edge in sim, I can do it with real money.

Even though my account is not $1,000 that is the amount I will start with for this journey. Why, because at one point, my account was down to $1,000 and that's when I decided to find out how to trade instead of chasing the holy grail. That was about 4 months ago. You can read my elite journal (aztrader's journal) if you want to read more about this. I figure some of you are at the $1,000 level and are desperate to find out how to make that $1,000 blossom into a stead income.

This post will include my daily trades, my thoughts, and a spread sheet tracking my equity curve.

I am not perfect. In fact, I'm probably not the person to have this thread. But I had the idea and just went with it. Here is my promise to you. I will be 100% transparent about this journey. Nothing held back. If it happens, you know about it. In return, please be honest with me as well. It'll be good for the thread and others will benefit from your thoughts as well.

I hope you find value in this thread.....please make sure to leave me your feedback. Its important.

Next post is about what I think are the essential rules and strategies for turning a small account into a living.

Start small but think big...thats what I say!

AZ

First of all I like to thank you for this thread it is truely inspirational and would also like to congradulate you on the successes you've made thus far. I just joined futures.io (formerly BMT) and read your entire thread before replying. We unfortunately have similair experiences. I too had some years in the marketing business. I owned a Appliance and Televison retail store, owned a commercial marketing business selling LG Electronics commerical HVAC products and a distributor. Started out of my home with only a $10k credit card and built the business in producing over $7mm in revenue in just 3 short years. I also had to file for bankruptcy. This was a nightmare, taboo in my eyes, shameful and embarrassing. There was no way that I could personally be able to pay back over $1mm of debt.

I have been daytrading the ES for only 11 months now and with many down days, weeks and months. I was fortunate enough to walk away from the bankruptcy with a sizable amount of money that my creditors did not take and keep our home. I have traded on SIM then LIve trading and back to Sim trading several times. Now back on SIM trading, unfortunatley after losing over $30k of capitol. I am fortunate enough that I still have a sizable account capitol that I can trade from once I am fully prepared and capable of being a consistent winning trader. So until then, I will stay on SIM trading until I can be profitable at the end of the month. You have inspired me to create my own trading thread. Thanks again!

Good luck with your continued success and looking forward to reading your future posts.

Cheers
itrade

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  #176 (permalink)
 sam028 
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You can be happy and proud of these $55.
I wouldn't have bet a cent on you when I saw the first posts of this journal, a $1k account for trading TF, that was just impossible to me.
I'm very happy to have been wrong, and very optimistic for your next weeks/months !!!
I'm not sure a lot of people will understand this, because it's $55 and "only" a week, but it's an amazing job, nothing is harder than trading such a small account with something like TF.

Success requires no deodorant! (Sun Tzu)
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  #177 (permalink)
 PandaWarrior 
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itrade2win View Post
AZ

First of all I like to thank you for this thread it is truely inspirational and would also like to congradulate you on the successes you've made thus far. I just joined futures.io (formerly BMT) and read your entire thread before replying. We unfortunately have similair experiences. I too had some years in the marketing business. I owned a Appliance and Televison retail store, owned a commercial marketing business selling LG Electronics commerical HVAC products and a distributor. Started out of my home with only a $10k credit card and built the business in producing over $7mm in revenue in just 3 short years. I also had to file for bankruptcy. This was a nightmare, taboo in my eyes, shameful and embarrassing. There was no way that I could personally be able to pay back over $1mm of debt.

I have been daytrading the ES for only 11 months now and with many down days, weeks and months. I was fortunate enough to walk away from the bankruptcy with a sizable amount of money that my creditors did not take and keep our home. I have traded on SIM then LIve trading and back to Sim trading several times. Now back on SIM trading, unfortunatley after losing over $30k of capitol. I am fortunate enough that I still have a sizable account capitol that I can trade from once I am fully prepared and capable of being a consistent winning trader. So until then, I will stay on SIM trading until I can be profitable at the end of the month. You have inspired me to create my own trading thread. Thanks again!

Good luck with your continued success and looking forward to reading your future posts.

Cheers
itrade

itrade,

First of all, thanks for reading. It always amazes and humbles me when anyone reads anything I write. Mostly because I know how much better it should be and to have anyone read something and then come back for more is truly humbling.

Secondly, I am so glad you found the thread helpful in some small way. Yes the thread is mostly for me to document and learn about my trading, but I did start it with the idea that many people are probably on the same journey I am and for once would like to hear the good the bad and the ugly. Hence the no BS policy in the thread. If it happens, you hear about it.

Thirdly, I am truly sorry to hear of your losses. I know how difficult this kind of loss can be. Your blood, sweat and tears went into building your business and in many ways, your identity can be wrapped up in it so much that when it fails, you ask yourself, "who am I these days"? Truthfully, our business does not define us, our life's purpose and passion should define us and our business should be a means to that end, but unfortunately, most people have it the other way around. I trust that in this time of loss and recovery, you find the true meaning of your life and work toward that with trading as the funding mechanism.

And lastly, your commitment to start a journal is an important one. I can honestly say that my trading did not improve at all over the last 18 months until I started to journal. I would also recommend you read the posts I recommend in a moment and I also recommend you spend far more time in the psychology and money management section of the forum than anywhere else. Trading is all about the mental game. Its probably a 90/10 split in favor of the mental side.

Be sure to post your charts, tell us what you were thinking, tell us about the ups and downs and most importantly of all, you must be brutally honest with yourself, your family and with us. Trading punishes the dishonest very harshly.

Thanks again and I look forward to seeing your posts as you journey down this crazy road toward trading success.

Here are the posts I recommend the most. Some of them are in the elite section. Please pay the amount you think the forum is worth to you and become an elite member if you are not already.





My other journal: Yes I do recommend it for the mental stuff.

This journal for simplicity.

Pretty much every thing here: Psychology and Money Management - Big Mike's Day Trading Forum

After that, I recommend you search out Dr. Brett Steenbarger's books on Amazon. Buy them all and devour them. Mark Douglas, "Trading In The Zone".

Ok, I'm preaching now....good luck and glad to have you aboard.

Simplicity is the ultimate sophistication, Leonardo da Vinci


Most people chose unhappiness over uncertainty, Tim Ferris
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 PandaWarrior 
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sam028 View Post
You can be happy and proud of these $55.
I wouldn't have bet a cent on you when I saw the first posts of this journal, a $1k account for trading TF, that was just impossible to me.
I'm very happy to have been wrong, and very optimistic for your next weeks/months !!!
I'm not sure a lot of people will understand this, because it's $55 and "only" a week, but it's an amazing job, nothing is harder than trading such a small account with something like TF.

I am laughing out loud here. Two months ago, I would have bet against me too. Today, I think its about a 50/50 shot. I do have more than $1000 in the account, but I wanted to make the challenge as hard as I could. So $1000 is pretty easy to chew through and I knew if I could trade it for a whole month, I could trade my real account just as well.

Thanks so much for the encouraging words. I need them!

Simplicity is the ultimate sophistication, Leonardo da Vinci


Most people chose unhappiness over uncertainty, Tim Ferris
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  #179 (permalink)
 PandaWarrior 
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Finished my upgrade to NTb19. So far so good. One good by product of the upgrade. All my non standard indicators got trashed in the process. I only re-imported the ones I use. No more temptations.

Seems to load faster as well. We will see next week.

Simplicity is the ultimate sophistication, Leonardo da Vinci


Most people chose unhappiness over uncertainty, Tim Ferris
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  #180 (permalink)
 PandaWarrior 
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Been thinking a lot about having a daily game plan. One that is essentially the same every day but has flexibility built in. In the military, they have a saying; its called the 7P's. Prior Proper Planning Prevents Piss Poor Performance. Every battle fought was first fought on paper. This focuses the units actions toward the correct objective. Its a known fact the first live rounds fired in battle essentially negates the paper battle planning done back at HQ. But the soldiers depend on the basic framework of the plan. They use it to stay focused on the objective, regroup, co-ordinate rescue extractions, re-supply,etc. But the fine details are almost always modified on the fly in the heat of battle.

In the same way, I think a daily game plan is essential. For me, it starts with a daily chart. Where are we in the larger picture. Then look at a 30 min or 12 range chart with at least 5 days on it and see where we are in the intermediate picture and then to my trade chart, how might today play out in context of the larger time frame?

Within the trading chart, the larger picture should play out. Short continuation, long continuation, consolidation day? Breakout day. And then be prepared with a plan to execute should any one of these present itself. Be flexible with the details but execute toward the larger picture if at all possible.

In context of the daily range, is today likely to be a narrow range day, a trend day, are we going to test the recent highs or lows? If so, where are logical targets for exiting positions? My entries are defined by my trading chart but the larger time frame could lend clues to good exits.

I am working on this concept. Not at a place to formalize or execute on this type of battle plan yet but getting closer. My method works regardless of whether or not I look at my trading like this but I suspect it would get better and I could potentially capture larger trades if I did.

What are your thoughts regarding this type of thinking?

Simplicity is the ultimate sophistication, Leonardo da Vinci


Most people chose unhappiness over uncertainty, Tim Ferris
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