Oil’s Journal

[Nick Radge]

Well deserved. Great effort.

[OliverBenson]

January 2022

MOC Long 1 +1.22%

Wild month. MId month, I got crushed about 5 days on the trot and was at about 10% drawdown. Then out of nowhere +11.5% day. Biggest equity swing day (in either direction) so far.

I must confess to feeling a bit of FOMO reading some other people’s MOC returns! Well done all. I am keen to try and replicate those same numbers, not necessarily in order to change my own system but to understand why the variation. I know (from conversations and twitter posts) that Nick runs a lot more positions and I think on a wider universe (My system is R1000 only). I will experiment with different position sizes and universes.

[OliverBenson]

February 2022

MOC Long 1 +3.42%

Firstly, I feel I should preface this post by saying that it feels wrong to even think about moaning given the flooding in Queensland (I hope none of you are too badly affected) and the disgusting events unfolding in Ukraine. That said, I have just been catching up on the recent forum traffic and I have one that I hope will make Kate feel a little bit better about the events of 24th Feb….
I loaded my trades as usual in the morning. Given the events unfolding that day I checked the markets (indexes only on line – not the VPS) and noticed the initial big gap down (this was around 3pm UK time which is 10am US). I got home at around 6:30pm (1.30pm US time) to a house full of loud, dis-satisfied humans (2 of whom are under the age of 5). I went straight to my PC much to the distain of Mrs Benson, opened the VPS and found that out of 30 orders (300% margin) I had 27 fills. Something had gone wrong though as the only 4 MOC orders were live. I was up about 4.5% and the market was kind of going sideways at that point. Bear in mind that this was the highest number of fills I have ever had and the 2nd highest daily return I had ever seen. I hit the ‘close all positions’ button. The market then instantly rallied hard and had I held on to the close (9pm UK time) and manually set up the exit orders, I would have been up around 12.5% so I left 8% on the table.
Now I could dress this up in 2 different ways. The first (bullshit) explanation would be that I had a long day at work, I was tired, I was stressed out, I had to get the kids to bed, I was worried the VPS would crash or I could have an IT issue that would leave me stuck in my positions overnight with a war going on, I didn’t understand what had gone wrong with the API/Server etc etc… so I just exited everything ASAP. The actual truth is that yes, I was stressed out by the magnitude of the situation, was concerned about being stuck in the positions overnight etc etc. but I knew that I could hang in there and wait to exit the positions manually at the close. If I am being honest with myself, I saw the money on the table, the market looked like it could go either way, I lost my bottle and grabbed the cash while it was there.
In the grand scheme of things, I know that this event will have no real financial impact on my life. If anything, it is gratifying to know that the system ‘would have’ made the full 12.5% that day (had I not been so weak). However the big take away for me is the re-affirmation that I would make the world’s worst discretionary trader! I think it’s no co-incidence that we gravitate towards people and pursuits that fit our psychological make-up and pre-conceptions about the world and it’s contents. I’ll do my best to remember this event and if I am ever again forced to make a discretionary trading decision, I will try to take the option that would be most closely aligned with the decision that the system would have made.

[KateMoloney]

Thanks for sharing Oliver. Shame you missed out on gain, and no, it doesn’t make me feel better seeing people like yourself miss out.

Trading is such a head game, isn’t it.

Am putting up a sign in my office “tho shault not over ride the trading system” :whistle:

[KateMoloney]

Another thing that has really helped me is to not check the system during trading session.

The news can be such a distraction too, so switching it off helps. We think one piece of news means “a bad trading session” is coming, or the futures market down 2% – 3% means a bad trading session is ahead. In most cases it amounts to nothing.

I used to check my day trade strategy at 5am local time (2 hours before close) but mainly to check the tech as I had issues early on with the API and did not trust/understand TWS. Now there is certainty it works, I just login 20 minutes before market close to see if the MOC orders are placed.

Had I logged in during session on the 24/1, I am sure the system would have been down 15% – 20% at one stage, but it ended trading session with a 32% gain. Don’t know about you Oliver, but I’d rather get my beauty sleep and wake up with a tidy profit than stress all night and second guess the system.

[TerryDunne]

Hi Oliver,

I had exactly the same system problem on that day. I have flagged it with IB to investigate, although that was a couple of days ago and I haven’t heard back yet. I suspect that you’ll find that the trades without MOCs were the ones hit right at the open.

I did have trades being held overnight with a war going on, so I wasn’t thrilled!

By the way, I have a rule for myself that I don’t look intra-day…a bit easier for me to follow as I’m asleep

Once I hear back from IB, I’ll let you know. I’m giving them today and will be chasing them tomorrow.

Best wishes,

Terry

[OliverBenson]

Hi Guys,

Thanks for your messages.

Kate I think you had particularly bad luck on this occasion. What a night to miss… But on the bright side it looks like you have a killer system there which no doubt will serve you well in the long run. I suspect you and Nick are doing something similar with your position sizing (note you mention 240 positions). I need to find out what you are up to!

Terry, thank you very much for your message, I’d be very interested to know what IB have to say. I just assumed it was an API crash because of the steep opening gap. I agree it’s no fun watching the P&L during the day. I only really check in to make sure the IT is doing it’s thing as I have had a few instances where it has not and I’ve been stuck in positions overnight.

[TerryDunne]

Hi Oli,

I think the ‘discussion’ with IB will take some time…their response to the fact that MOC orders weren’t generated was effectively that they can’t help because MOC orders weren’t generated. I will speak to them again tomorrow.

I don’t really mind where the problem lies, but a problem with the API shouldn’t arise no matter how much the opening gap is, in my opinion anyway.

[Nick Radge]

Terry – I had 172 orders executed without issue. Same API.

[KateMoloney]

Hi Oliver,

I wouldn’t say I have a killer system. The % profit I missed out on only happened in 1x trading session in 18 years of back testing, the profit day I missed was just an outlier day (or dumb luck), that’s all. Outlier losses can also occur. It is not everyone’s cup of tea.

It is wiser to focus on your own personal circumstances and design your system around that.

[TerryDunne]

Hi Nick,

Same broker too.

I don’t know where the problem lies, but I will continue to talk with IB.

[OliverBenson]

Thanks guys. Just found the same thing (some MOC orders not placed) in today’s session. Did anyone else have any issues?

[Nick Radge]

I think this is a TWS version number issue after a recent upgrade.

I am using version 981.3j, which is Jan 18, 2022 and not had any issues.

This version is known as TWS Stable and can be downloaded here:

https://www.interactivebrokers.com/en/index.php?f=16042

[Nick Radge]

ok…cancel that. I had an issue last night as well…

[Nick Radge]

I can see IB found a bug relating to start/end times for orders. I’ll be updating to that version which is now 981.3k

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