Should I Be Frustrated?

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Boswell

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Without wishing to go into personal details, mostly to do with having to have money kept to help my wife with her business, which is very tough at the moment, I don't have enough to really start trading at present. Golden rule that a spread betting account, has to be looked at seperately, and MUST be outside of my normal household budget.

The way I work is mostly made up from bonuses, and the last few months I haven't had enough to put aside for trading (want around £2000) as a start up account. Work has picked up and should quickly get that in the next couple of months, but feel I am missing big opportunities at the moment. I understand Livermore? "things that happen in the past will happen again......", but markets are not linear.

I base my trading (paper) on technical, but have always been a news hound and fundermentals have to be taken into account. So at some times the news and the markets can be quite slow, just plodding along, but that is far away from the truth at the moment. The Arab Spring, Japan earthquake and nuclear problems, Libya are causing a huge amount of volitivity at the moment. Oil up 24% this year, and in my paper trading I would have put a long bet on over a month ago.

Well will keep plodding on until I can get my account sorted out, but hope that all in t2w have been doing well this year.

For the experienced traders, a question "would I be correct to think that in such interesting times this would be when you would increase the amount of trades, and amount of bet size (as long as your account size would support such a move)"
 
Boswell said:
Without wishing to go into personal details, mostly to do with having to have money kept to help my wife with her business, which is very tough at the moment, I don't have enough to really start trading at present. Golden rule that a spread betting account, has to be looked at seperately, and MUST be outside of my normal household budget.

The way I work is mostly made up from bonuses, and the last few months I haven't had enough to put aside for trading (want around £2000) as a start up account. Work has picked up and should quickly get that in the next couple of months, but feel I am missing big opportunities at the moment. I understand Livermore? "things that happen in the past will happen again......", but markets are not linear.

I base my trading (paper) on technical, but have always been a news hound and fundermentals have to be taken into account. So at some times the news and the markets can be quite slow, just plodding along, but that is far away from the truth at the moment. The Arab Spring, Japan earthquake and nuclear problems, Libya are causing a huge amount of volitivity at the moment. Oil up 24% this year, and in my paper trading I would have put a long bet on over a month ago.

Well will keep plodding on until I can get my account sorted out, but hope that all in t2w have been doing well this year.

For the experienced traders, a question "would I be correct to think that in such interesting times this would be when you would increase the amount of trades, and amount of bet size (as long as your account size would support such a move)"
Click to expand...

well a number of traders i've followed so far this year have had a hard time, including myself, so I think you're lucky to have been out of this volatility. It all depends on your trading style, but I am hoping this market will become a bit more stable for the rest of the year.

For my style of trading I would not increase bet size when things are uncertain. You're basically increasing "risk", when the level of "risk" in the market is higher!
 
well a number of traders i've followed so far this year have had a hard time, including myself, so I think you're lucky to have been out of this volatility. It all depends on your trading style, but I am hoping this market will become a bit more stable for the rest of the year.

For my style of trading I would not increase bet size when things are uncertain. You're basically increasing "risk", when the level of "risk" in the market is higher!

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Thanks for the reply.

That does make sense. As you can see by my proposed account size, and more importantly that I am a rookie, it does look a bit like big boys games at the moment with those who have good account sizes and willing to risk against high returns and high losses, well out of my league.

Even with the paper trading I have noticed that it has been a lot easier to be 'whipsawed' out of a trade with this much volitivity. I know some might say that you should increase the size of the stop loss, but if it continues to move against you then the losses are bigger. Not sure how you square that circle.
 
Hi Boswell,
I think you have to think of yourself as a risk manager as well as trader, they go hand in hand so don't try to increase risk when volatility increases try to manage risk.
The thing is when you speak of 'missing opportunities', I get the feeling you are looking at world events as much as markets. Markets go up and down all the time. They will always be there, there is always scope to trade so don't be in too much of a hurry.
 
Boswell said:
Not sure how you square that circle.
Click to expand...

it's called staying out of the game, or reducing exposure at those times, until favourable times return, at which point increase exposure again. Check out the journal by "myhedgefund" in the journals forum, he demonstrates how he is reducing positions and increasing cash at this time.
 
My short answer to your question is definitely 'no'. Mr Livermore was right and todays events don't change that reality imo.

Seriously if for the last month I had been trading in a bunker somewhere with no connection to the outside world media, I don't think I would have put myself at a disadvantage. As it is I strictly limit all media bla bla so as not to develop strange predictions of what I think should happen, or indeed what I might have missed. One exception at the moment with heavy intervention on usdjpy I've taken it off my list, I did the same with the swissy last year for same reason.



Dare I say...... trade what you see.

Everyday is big boys stuff, they never go girlie.

Really no need to think you've missed the party, there is no party, it'll all still be here when you arrive with your wad :)
 
Volatility, looked at simply as daily range or Average True Range, is not going to give the full picture so far as it relates price movements to profitable opportunities. The intra-day behaviour of the bulk of the market's participants is affected by volatility because it ususally indicates an increase in risk: so they're driving the market in ways it doesn't usually follow, and a side-effect is increased volatility. I am finding moves that normally complete at a certain distance from start / entry are now reversing and perhaps reversing again. This means I am keeping my positions to about half normal and am staying out altogether if early morning volatility is very high.

The clue is I am thinking more about what I could lose during the current strange times than what I could gain.
 
World events are always happening. Don't worry about missing out now. By next year you won't even remember what the heck a Libya is and we will be focusing on whatever recent event is happening then. Many others here have already given good advice on trading smaller during volatile times. Be patient. You'll have plenty of time to be impatient once you get started!

Peter
 
keep demo trading until you have the funds and a profitable track record. the markets will always be there...
 
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