- This topic is empty.
-
Last week … what a week !
Flood waters in Brisbane are predicted to have peaked this morning …. stopping 3 doors down from our home.
Getting back into my usual daily trading rhythm now we know our home is safe.Had a session this morning with my coach working through my “oh fuck” moment last week. My biggest learning was that taking that night off allowed me the space to honour and grieve my friend who had passed away. Had I participated in the big win, I wouldn’t have remembered all the business wisdom and lessons he taught me. I would have covered up my grief with money.
In a few years, I’ll be much more detached from monetary gains & losses, but right now I’m still a new trader and stumbling along. Being able to make over 10%+ in a night wasn’t in my reality 6 months ago. I am still learning elation management, especially for those extreme winning days.
Another realisation from my session is that creating a system and trading it each day can be quite mechanical. With the timing of my friends death and the impact he had on my life, I’ll be naming this new system after him and trading with him in mind (from a legacy perspective). He told me his children were “managers and not entrepreneurs”. He wanted to pass on some of his entrepreneurial lessons and wisdom, so he did so with anyone who showed interest.
It might sound silly to some, but to me, trading with meaning and a purpose in mind makes us better traders.
So, other than Nick having a wee jab this morning
(joking) I’m all good with missing out on the profits last week.ASX momo 0% – CASH
Growth Port 0% – CASHUS TLT -1.56%
US Momo +2.38% (about to go 100% cash)MOC systems
TB -4.27%
WP -9.87%All longer term systems will be cash for March.
Great lessons with the MOCs this month. They would have achieved a much healthier return if it wasn’t for blondie here! Been discussing the lessons at length with my husband today, so definitely getting value from it in and will be banking that value later. Took about 2 days to fully get over it, feeling no remorse or guilt now.One insightful thing my husband shared is that if you have certainty with your system and back testing performance etc, then you are more likely to stick to trading it even through the volatility. If you are uncertain with your system then you are more likely to over ride it. So the initial back testing & research period is critical to gain that certainty and trust.
A while back I printed out the daily non compounded P & L and put it on the fridge. We have been discussing that a lot today.
I can also see that during periods of volatility, like now, the day trade systems thrive while long term strategic holds and longer term systems lose money. So you are being tested with your non day trade strategies and in a way need to have your head “in the right place” even more so than “normal times”.
In the future I will be even more ruthless with distractions that take my focus & attention away from my trading game, especially during periods of volatility.
Have also come up with a potential solution for day trading during holidays or personal leave. Mum said she is willing to learn to run explorations and load the trades. In 3-6 months I’ll set up video instructions for her and see if this is a feasible option to try for short term periods.
Onwards and upwards.
March update
ASX Momentum – CASH
Growth Defensive -0.11% (missed two signals due to being overseas)US Momentum +0.75% (missed dividends added to records)
TLT +1.5% (missed dividends)The Buffett +7.84%
White Pocket -5.24%Been a productive month overall. Really enjoying the process of trading.
Have launched phase I of the White Pocket remodel, which saved brokerage costs. So far, so good.
Currently working on Phase II of the remodel and will launch the beta mode next week on a reduced account size.Once this is done, I’ll do the same for The Buffett, with the goal to launch both phases by early May.
I have also been reading “The Psychology of Money” book that Nick recommended. It is a great read. One of the chapters talks about single points of failure in business, which really got me thinking about our trading business.
Last year our mobile and internet provider, Optus, upgraded a tower in our area, which led to verryyyyyyyy slooooowwww / non existent internet for 6 weeks. And we live near the Brisbane CBD! Since that bad experience, we got Telstra mobile internet for our home, and as a backup, I kept my Optus phone plan with 125GB of mobile data. Since the floods last month, the Telstra internet has been playing up and I am hotspotting off my mobile. Bloody Murphy’s Law!
After reading the book, and reflecting on how disruptive losing the internet was, I looked at other single points of failure in the business.
I upgraded my laptop and kept my old one as a spare – in case a laptop dies. Having two laptops has been very handy during the MCS and optimizing stages, has saved so much time, and its been handy having a laptop to refer to for the correct AB settings.
I have also set up AB and Norgate on my VPS for emergency situations.
Then I looked at data backups. I use onedrive, but heard of a business friends experience … they were hacked and lost all their documents on onedrive. It took Microsoft a month to restore their documents. Quite scary.
So now I have a secondary backup with idrive, who back up documents and also do disk imagining. The cost is minimal and I consider it cheap insurance. I also have a hard drive that I back up once a month and store in a safe.I have also started rewriting my brokerage access documents in more detail, including setting up two trusted people with logins with the broker. The process with IB has so far been very easy.
What other single points of failure have you identified in your business and what steps have you taken to over come them?
Here is todays head f*ck / lesson from the market.
System one is my first system. I made all the rookie errors, over optimizing too many parameters, changing the rules a lot between the R1000 & R2000 versions. Low trade volume. etc etc. I will be reviewing this system as my next project.
Despite all the errors, system one is profitable.
System two, got a bit better. Applied new learnings. More trade vol. System is nearly back to breakeven.
If I followed what made money, I would stick to the first system and potentially dump or tweak the second system. The problem is that over optimized systems are not sustainable. So measuring success purely from financial results would be naïve.
Another lesson – there is nothing like real world experience. Last year in October Nick suggested I start trading. I was nervous and wasn’t 100% happy with my system. But it was the best feedback he could have given me, it got into the market and with experience comes (eventual) wisdom.
Confessions from a recovering over optimizing addict.
In the past, I defined the below area as a flat spot.
Then I learned it was best practice to zoom out, chuck a line down and pick the middle (as below).
I have had a tendency to aim for the best results without understanding the long term ramifications of making those decisions. I’ve had to rewire my thinking to look for what is sustainable long term VS what is the best return I can make now.
For fun, I ran an experiment using MCS and the above two parameters.
What I noticed is that the second param produced average results in the MCS that were more aligned with the backtest. Also the difference between the high and low return/max DD was a lot smaller (compared to when I tested the first parameter).
This concept probably sounds so simple to the more seasoned traders. But I’m still in newbie phase and before November I didn’t know who or wtf Russell (1000) was.
Step by step, day by day, working on improving skills & knowledge
- You must be logged in to reply to this topic.