November 2018 Go-Live Support Group

[Mike B 625]

Hello Everyone,

I wanted to start a post for anyone planning to go live in November, or who has recently gone live in the past 30 days. I feel that sharing our trading experiences with others who are in the same place in their trading journey can be extremely helpful.

After reading Andrew's books, listening to the classes, psychology rants by Robert, and lifetime webinars, I believe stating your goals, risk controls, and allowing yourself to be held accountable is vital to getting through the learning curve without completely blowing up your account.

So in an effort to hold myself accountable, below is my plan for the 1st month along with the goals and risk controls to help me get through it.

Live Date – November 5, 2018. I can’t trade November 1 or 2.

Share Size – 100

Daily Goal – $20 (1/5 of my planned daily goal once I make it through the learning curve).

Daily Max loss – $60 ($20 per trade)

Goals for the Month 1

1.       Do not blow up my account

2.       Have a 2:1 ratio at the end of the month with average winning trade versus average losing trade

3.       Have above a 60% average win rate

4.       Daily goal is a metric to measure profit taking plan efficiency, not an amount to hit every day

Risk Controls in Place for Month 1

1.       Max loss: 100

2.       Max Shares traded in a day: 800

Trading Methodology for Share Size Increase/Decrease

1.       Increase share size by 50 shares every time I trade 5 consecutive days green

2.       Decrease share size by 50 shares every time I trade 3 consecutive days red

3.       After 3 consecutive days red, return to sim until 3 consecutive days green

4.       If max loss is hit for any reason other than internet connectivity issues return to sim for the remainder of the month.

5.       If max shares reached, return to sim for the remainder of the week.

Looking forward to beginning the journey of live trading and tackling the infamous learning curve with some other traders. It would be great to see who else is going live and develop a support group. Thank you!

Edited October 31, 2018 by Mike B
update

[Robert H 455]

19 hours ago, Mike B said:

If max loss is hit for any reason other than internet connectivity issues return to sim for the remainder of the month.

Curious about the rationale regarding this? Wouldn't 'remainder of the week' be a little more reasonable?

[Dmitriy 2]

Hi Mike,

I'll be going live later this week probably on the 1st. I should be good to go with Centerpoint Securities by Wednesday. Which broker are you using?

Your trading plan looks pretty solid. Is your max loss of 100 for the month or per day?

My trading plan is a bit more simple:

Daily trading plan:

Daily profit target: 100

Daily max loss: 100

Max loss per trade: 50

3 trade entries MAX

Goals for the month:

1. Have more green days than red days

2. Don't get too emotional 

Looking forward to staying in touch during the month. If a few more people join in, maybe we can set up a group chat mid month to discuss progress and ask questions. 

 

 

[Mike B 625]

3 hours ago, Robert H said:

Curious about the rationale regarding this? Wouldn't 'remainder of the week' be a little more reasonable?

I would agree with you that it is extremely harsh and seems unreasonable. To point that I never want to reach that, especially in the first month of live trading. I am considering lowering the bench time as I spend more time live trading.

I think I left out one vital component in my post, which is my daily max loss is $40 dollars ($10 per trade), so if I hit the risk control max loss of $100 dollars than I have lost over 2 times my daily max loss. This of course means I have gone hulk, thrown all my rules out the window and have lost control of my emotions. The max share size should keep me from hitting this, but you never know when you are going to hulk and try to average down in hopes it comes back to breakeven. In the past 2 months of simulator trading at 100 shares I have hit that mark only twice, both times was because I let my emotions get the better of me and average down.

Sometimes the pain of sitting on the bench can be a huge motivator in keeping your emotions in check. As I increase my share size my risk control max loss will also increase based on my daily max loss amount. 

I am always open to critique from more experienced traders, so with that information do you think I way off base?

Thanks for any insight Robert.

[Mike B 625]

1 hour ago, Dmitriy.Pinchuk said:

Hi Mike,

I'll be going live later this week probably on the 1st. I should be good to go with Centerpoint Securities by Wednesday. Which broker are you using?

Your trading plan looks pretty solid. Is your max loss of 100 for the month or per day?

My trading plan is a bit more simple:

Daily trading plan:

Daily profit target: 100

Daily max loss: 100

Max loss per trade: 50

3 trade entries MAX

Goals for the month:

1. Have more green days than red days

2. Don't get too emotional 

Looking forward to staying in touch during the month. If a few more people join in, maybe we can set up a group chat mid month to discuss progress and ask questions. 

 

 

Hello Dmitriy,

I am using CME Group, as I do not want to have 25,000 in the account until after I get through the learning curve. Another self-imposed risk control to prevent me from hitting zero through the learning curve. I know the commissions are higher, but right now I do not even count those in determining whether I have a green day or a red day. I consider the commissions and ECN fees my tuition cost of learning the psychology of trading. Eventually, I plan on getting an account with IB.

I seemed to have left out my max daily loss amount. I adjusted my post to reflect the $40 ($10 dollars per trade) daily max loss.

I like the idea of a group chat in the middle of the month. Hopefully we will get a few more traders going live this month to join us.

[Robert H 455]

Okay that makes more sense--gotta punish the Hulk. I'm just thinking of a scenario where you hit -$100 on day 1. This means you have to sim trade for another 19 days. Nobody benefits from that. Personally I have a 3-step plan for getting back in the saddle after a Hulk day:

1. Take a day off (no opening DAS)

2. Take a No Trade Challenge (watch the markets but no trades--either sim or live)

3. One day in simulator

4. Back to live.

You mentioned max risk per trade is $10. Trading 100 lots means a 0.10 stop. This is way too tight and you won't be able to survive natural 0.10 gyrations or normal pullbacks.

[Abiel 475]

@Mike B If you want to trade risking a fixed amount of $10 / trade you may consider using these hotkeys. They calculate # of shares based on your % of account or $$ you want to risk in a trade.

[Mike B 625]

21 minutes ago, Abiel said:

@Mike B If you want to trade risking a fixed amount of $10 / trade you may consider using these hotkeys. They calculate # of shares based on your % of account or $$ you want to risk in a trade.

Thank you Abiel, I am going to have to look into that and practice it in sim to see how it works for me.

[Mike B 625]

On 10/29/2018 at 6:50 PM, Robert H said:

Okay that makes more sense--gotta punish the Hulk. I'm just thinking of a scenario where you hit -$100 on day 1. This means you have to sim trade for another 19 days. Nobody benefits from that. Personally I have a 3-step plan for getting back in the saddle after a Hulk day:

1. Take a day off (no opening DAS)

2. Take a No Trade Challenge (watch the markets but no trades--either sim or live)

3. One day in simulator

4. Back to live.

You mentioned max risk per trade is $10. Trading 100 lots means a 0.10 stop. This is way too tight and you won't be able to survive natural 0.10 gyrations or normal pullbacks.

I like your 3-step plan for getting back in the saddle after a hulk day, I think the further I get into the live trading that is where I ultimately want to get to. I could not agree with you more that nobody benefits from not trading for 19 days when trying to get through the learning curve, that is why I am terrified of hitting that number, which I believe helps me from reaching -$100. 

I did some analysis on the $10 limit and I readjusted my daily max loss to $60 ($20 per trade). This lowers the number of trades to three losses in a row but still stays within my risk tolerance for the first month. 

[Dmitriy 2]

Hi all,

I need to rant about a bad experience I had in the afternoon session of trading today. It was a great morning. My first trade with BABA was 100 shares and 206 profit by 945. I should’ve stopped there but I took a few more trades because the set ups were good and made it up to 255. I was more than thrilled with 2.5 times my profit target. I was done for the day. I did my recap and went to have lunch. 

So here is the bad stuff. After lunch I thought I would just go “look” at the market and see what was going on in the chat room. Once I looked at the charts again, i felt the insatiable urge to trade. I knew I shouldn’t have and didn’t need to, but I did anyway. After taking a small loss, i decided it was a good idea to revenge trade BABA. I took about 10 trades without any plan or risk/reward. It was all chop but I didn’t seem to care. I traded my way down to 175 PL and after all the commissions down I was at 126. 

This was really frustrating because it seemed like I was on autopilot hulk mode. With the help of my wife, I stopped myself before it was too late. I can’t help but feel ashamed at myself and embarrassed. I decided to write a rule on my whiteboard that I would go in the sim once I hit my profit target. Does anyone have any advice or can speak to their own experiences with something like this? 

That concludes my rant, thanks for listening. 

[Abiel 475]

35 minutes ago, Dmitriy said:

Hi all,

I need to rant about a bad experience I had in the afternoon session of trading today. It was a great morning. My first trade with BABA was 100 shares and 206 profit by 945. I should’ve stopped there but I took a few more trades because the set ups were good and made it up to 255. I was more than thrilled with 2.5 times my profit target. I was done for the day. I did my recap and went to have lunch. 

So here is the bad stuff. After lunch I thought I would just go “look” at the market and see what was going on in the chat room. Once I looked at the charts again, i felt the insatiable urge to trade. I knew I shouldn’t have and didn’t need to, but I did anyway. After taking a small loss, i decided it was a good idea to revenge trade BABA. I took about 10 trades without any plan or risk/reward. It was all chop but I didn’t seem to care. I traded my way down to 175 PL and after all the commissions down I was at 126. 

This was really frustrating because it seemed like I was on autopilot hulk mode. With the help of my wife, I stopped myself before it was too late. I can’t help but feel ashamed at myself and embarrassed. I decided to write a rule on my whiteboard that I would go in the sim once I hit my profit target. Does anyone have any advice or can speak to their own experiences with something like this? 

That concludes my rant, thanks for listening. 

Hi @Dmitriy... Just uploaded your recap, now I have to take it down... LOL! 

Well, welcome to the rollercoaster of live trading.  This is a problem so common that we have a Forum thread started by Andrew: "Why having a daily profit target is important"

My advice:

1. Set your Risk Control Page or at least your daily max loss
2. Get an accountability partner 
3. Watch Class 5 Risk Management there is a section on how to deal with "Hulk Days" 
4. Watch Robert rants in Education Center, in particular Addiction, Rehab and Relapse (Episode 3)
5. Read this forum thread: Feb 2018 Go-Live Support Group
6. While trading, if you feel euphoric (you are winning) or angry (you are losing), stop trading (easier said than done). Both feelings impair the our skills and clear thinking. 
7. Every day before your trading session, remember what happened today. 

[hugo9099 20]

@Dmitriy
Totally normal what you suffered today.. For the record I have had days going from +400$ to  -1200$ live account after hitting goal (of course) and went back for a few bucks more.

The easiest path to overcome this is:
After you are done for the day, get up from the station and take a walk, drink some water, go to the bathroom and enjoy the good day you had today.
If you feel urged to trade when you come back then Switch to Simulator account so you can satiate the urge to trade. You have to learn to recognize the euphoria feeling after a green day.
Please note that you can have a green day after bad trading. Having good/bad trading are not always related to having green/red days.
Also, take a look at your trades and analyze them. It is always good to ask yourself what would have you done if the scenario of a particular trade changes.
If you are feeling tempted with more money then you are not trading well enough.
The final/main goal is to make money, (because nobody eats or sleeps under a roof made of good trades)
But the immediate goal you have to pursue (and put all your effort to) is to trade well. I can assure you money will come along.

If you have any question, let me know. All the best.

[Norm 46]

Sorry to hear about your hulk day, but just know this happens to all of us. The fact you were able to stop before you went negative is actually quite impressive. Now you know how awful it feels to break rules like that and you'll know the consequences of doing so in the future. Good job on a couple of green days to start.

[Mike B 625]

First off,  my thoughts are with anyone in Northern or Southern California that have been affected by the fire,  and to those supporting the efforts in the areas.

 

Here is my wrap-up for the 1^st week of live trading.

Weekly Overall Self Rating: Good

Daily Goal Hit – 0 of 5

Daily Max Loss – 1 of 5

Goals for the month progress

1.       On track for not blowing up my account

2.       Well below 2:1 ratio

3.       Below 60% on average win rate

Risk Controls

1.       Did not trigger Max Loss control

2.       Did not trigger Max Share traded in a day control

Trading Methodology

1.       Did not increase or decrease share size

2.       RGRGR

Weekly Analysis of trading

I managed to achieve the most important goal of not blowing up my account. I did however, find a way to reverse the average winning trade versus average losing trade from a 2:1 ratio to a 1:2 ratio. I did this by being fearful of entering the trade at my planned entry point, and instead entering at lower entry point; thereby, messing up my profit taking plan and throwing off my exit points.

I was extremely happy that despite my poor entries, I never messed around with the stop loss and exited every time I hit it. Once though I hesitated, but was able to bring myself back to reality and exit. Good thing as it went against me about a minute later. By the end of the week my average loss was consistent with my simulator trading average losses.

Friday was the worst day as I did not listen to myself when I was thinking to not trade, because the setups were just not there. I traded twice and hit my daily max loss. I am glad I learned that lesson this week.

What I Learned

Transitioning to live trading, I am hesitating on my planned entry points as I want to be completely sure before entering the trade. The problem with this is that I am missing my planned entry point, and then because of FOMO I am entering late instead of re-evaluating the trade and determining a better entry point. This is lowering the amount per winning trade. When evaluating the trade from my planned execution it is meeting all of my expectations with regards to risk/reward ratio.

What I did not Expect

I would say the one thing I was not prepared for was the psychological aspects of commissions and ECN fees. I have always said that I would consider commissions and ECN fees as a learning fee to getting through the learning curve. I never really analyzed how much I would be spending on these while I was in simulator as it did not matter. In simulator, I was maintaining a good risk/reward ratio, so the effect on my net equity never really appeared in any of the analysis. Due to my poor risk/reward ratios this week, it highlighted the amount I spend on commissions and ECN fees, so as the week went on, I became worried that I was spending more than I had in the simulator. This was causing a negative affect on my psychology, especially at the end of the week.

This weekend I went back through my simulator trading journal and calculated what I would have spent on commissions and ECN fees in September and October. To my surprise and comfort, I actually spent less this week than average. Just another reason why journaling is so important.

Now that I actually did an analysis on the fees, I have fully accepted the cost and should be able to trade freely without worrying about it.

 

As you can see from the below analysis, my poor use of indicators and confirmations is leading to bad entries that negatively affect the risk/reward and psychology. Additional goal for next week is to improve my entries.

[Mike B 625]

Here is my wrap-up for the 2nd week of live trading.

Weekly Overall Self Rating: Frustrated

Daily Goal Hit – 1 of 3

Daily Max Loss – 0 of 3

Goals for the month progress

1.       On track for not blowing up my account

2.       Well below 2:1 ratio

3.       Well below 60% on average win rate

Risk Controls

1.       Did not trigger Max Loss control

2.       Did not trigger Max Share traded in a day control

Trading Methodology

1.       Did not increase or decrease share size

2.       GRR

Weekly Analysis of trading

For the second week in a row, I managed to achieve the most important goal of not blowing up my account.

Monday was a good day, as I followed my trading rules and hit my daily goal with a 5-minute ORBD.

I cannot say the same for Tuesday or Wednesday. The one and only good thing about these two trading days was that I never moved or hesitated with my stop loss. I have found before and after entering the trade I am more relaxed and do not have as much anxiety as last week. Although by the end of Wednesday I was really frustrated with the results of my trading. I could tell my emotions were getting the better of me at the end of each day.

Wednesday was the worst day because I let my emotions get a hold of me and I just entered a revenge trade out of complete frustration when I got stopped out and as soon as I hit the hotkey to get out, the stock went in my direction.

What I Learned

In hindsight, I am actually glad that I was unable to trade Thursday or Friday due to a work conference. The two days away from trading has allowed me to take a look back and see that I had a real issue waiting from my trade plan to develop before entering. I was entering prior to the setup developing which was causing me to stop out.

I took a hard look at my edges and have altered my trading plan accordingly. I am definitely not trading the same way I was in simulator and need to get back to entering trades only when it meets my trade plan criteria.

Over the past two weeks I have entered more trades that don’t meet my trade plan criteria than I have entered trades that have met my plan.

What I did not Expect

This week I would say I did not expect to have two days in a row where every trade was a loser. In simulator, I would always have at least one positive trade in the day even if it meant that I was still red overall.

I still have to say that the effects of commissions on the net equity curve have an impact at the end of the day on my psychology. I think this is more because of the terrible week I had and it felt like I was doubling my losses due to the commissions. I have had to remind myself each day that it is a learning fee. I have also taken steps to remove the impact from my vision and chosen to focus more on the gross P/L.

I still have two more days before I can trade again due to work, but I am really looking forward to Wednesday. I still have not decided yet if I am going to trade live or sim.