Trading is easy - making money is hard

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wh92stang

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It's been one full year now of daytrading full time, and I am at the point where I am very confident in my trading abilities, and find it almost easy to make a consistent, reasonable profit day in and day out. HOWEVER, I am still losing money overall.

Every time I tie together a consistent profitable run (sometimes as much as 10-15 days straight of winning) I find myself taking more and more risk and eventually I give back all of my profits and then some. Is this common amongst those of you who trade full time? What I'm saying is if you give me a $10,000 account and say make $200 today with less than $200 max drawdown I'd say there's a 90% chance I can do it. But if you just put $10,000 into an account and let me do what I want with it, I might run it up to $12,000 over the course of 2 weeks. Then I'll say why $200/day, I can double my position sizes and make $400/day. Next thing I know I'll find my self on the wrong side of a trade that I believe will come back to me, double down, and it takes off even further against me and I'll lose all of my gains and then some. All on one really bad trade that I was significantly overleveraged on.

I've done this about 3 times now and need to stop before I run out of money to trade with. Anybody else have or had this problem and solved it?
 
I watched a webinar where the trading guy said to never add to a losing trade EVER and to never lose more than 1-2% on a single trade. some advice for what its worth
 
Once you've gone on a run of 10-15 days as you say. I would advise you to take your original balance out and not put it back in. Then cut your stakes in half from what they orginally were, if not by 75%.

Now try losing it?

Your trying to run to a million before you've hardly done anything consistent.10-15days will not prove any consistency in increasing your stakes. Not even one year would!

Forget about the numbers of $ or £ and concentrate on daily pip targets. Once you obatin them walk away. You haven't clarified any consistency yet and this false sense of belief that you have cracked it in terms of consistency is growing your greed and making you gamble.

Take this advice on the chin as it's important. Do you want be a financial trader or a gambler?

Not even professional gamblers put there winning back on!

You can do this! If your trading 10-15 without losing that doesn't demonstrate your consistency as an individual; it only represents your ability to read the markets and be right more then 50% of the time perhaps. Your ability to be consistent will be when you've gained from the markets for one year and still don't label it as consistent as you've still got work to do in the next year....

Go do it!

Clean your slate. Infact if you could force yourself: take time out of the markets so that you can deprogramme your habits and compose yourself to do what is required ahead!

If your need any help or further advice from myself, please do not hesistate to pm or email me: [email protected]

Kind Regards
User
 
the perils of day trading.. im the same, always going for bigger wins, bigger leverage etc..compounding..

will always end in disaster!

one of the reasons i stopped day trading and swing/posistion trade now. mainly because you dont get caught up in the moment so much, what could be 5mins to think about a trade while day trading, could be a week or so to ponder your position while position trading. certainly helps!
 
Most pussies think they are ready to trade in one year.All these pussycats are S and P traders ,counter trend monkeys,support and resistance traders /random zone traders and swingers on Tarzan's rope.

Clicking a mouse button and placing a buy or sell order isn't trading,it is gambling buy is black and sell is red, your broker did not tell you that.You need knowledge and skill before clicking the mouse.

All these gamblers who are not professional traders but gamblers.

Professional don't trade every day, and some days do not need to trade at all.Those who rely on a daily wage are f**cked up traders who often trade without an edge.They will only see true profitable set ups two or three times a week, the rest is gambling.

It will take several years to be consistently profitable.

Does that help?
 
Like you all have pointed out it is partially greed, trying to get rich fast. I think the rest of it is that I cannot accept that there will be losing trades and I need to be able to accept that and walk away with a few pips loss that will not be a significant loss to my overall capital. I think User's advice is what I need to focus on. A daily pip target and walk away when it is hit, no matter how good I feel I am doing.

I was thinking of another idea that I think might help. Each day on the calendar when I am done trading write down my final profit/loss for the day as well as my maximum intraday drawdown. Then have my girlfriend check it every night. I think that might help me from doing anything stupid because I have to show someone else my results no matter what, which would make me less likely to blow 10% of my capital in one day. Basically someone other than myself holding me accountable.

And Masq, I do need to use fixed stops. I've used mental stops because I hate placing physical ones, but that gets me in trouble more than anything.
 
oildaytrader said:
Most pussies think they are ready to trade in one year.All these pussycats are S and P traders ,counter trend monkeys,support and resistance traders /random zone traders and swingers on Tarzan's rope.

Clicking a mouse button and placing a buy or sell order isn't trading,it is gambling buy is black and sell is red, your broker did not tell you that.You need knowledge and skill before clicking the mouse.

All these gamblers who are not professional traders but gamblers.

Professional don't trade every day, and some days do not need to trade at all.Those who rely on a daily wage are f**cked up traders who often trade without an edge.They will only see true profitable set ups two or three times a week, the rest is gambling.

It will take several years to be consistently profitable.

Does that help?
Click to expand...

I agree that professional traders only trade truly profitable setups, but that doesn't mean someone cannot trade every day and be a professional trader. Some professionals have an edge scalping quick moves every single day. But I do understand your point. Wait for true setups, anything else is gambling.
 
wh92stang said:
I agree that professional traders only trade truly profitable setups, but that doesn't mean someone cannot trade every day and be a professional trader. Some professionals have an edge scalping quick moves every single day. But I do understand your point. Wait for true setups, anything else is gambling.
Click to expand...

If you trade twice a week on each instrument, look for high probability entries and set ups you will be fine.Professionals don't scalp ,only mugs who get scalped.

I don't know what instruments you trade, but you should get an average one trade per day to make 40 points daily on average.These set ups give high profits.
 
oildaytrader said:
If you trade twice a week on each instrument, look for high probability entries and set ups you will be fine.

Professionals don't scalp ,only mugs who get scalped.
Click to expand...

Well mate I have the highest respect for your mechanical trading, and I think that the advice you're giving him is wise, but it's not the only way to go about it is it.

Everyones gotta figure out what works for them right.

If you talk with Tom who was at Futex there they have some of the biggest players in the S&P's who are pure scalpers, as were most of their predecessors on the floor or their later off-floor brethren like Paul Rotter who has made 50 - 60 million €uros / year for over a decade scalping the bund.

This guy here was a consistent loser until he started scalping:

http://www.trade2win.com/boards/general-trading-chat/44624-55000-one-month.html

So while I agree with your point that for most it's much more sensible to trade off of higher time frames providing fewer high probability opportunities per week giving you more time to think things over, at the end of the day you'll have to do what provides the best mesh between your needs and personality which may well be diametrically opposed to what makes up the girl / guy next to you right.

If cutting losses very quickly poses no problems for you and profits start burning holes in your pockets pretty soon odds I'd say are pretty much against you that you'll succeed as a position trader, you just won't have the patience.

I think that's the biggest challenge in trading as in life, figuring out who you are, and what you want, two of the most important issues most probably remain clueless about for the remainder of their days on this planet I'd wager.

Which usually results in ending up where one didn't want to.

;)
 
I was thinking of another idea that I think might help. Each day on the calendar when I am done trading write down my final profit/loss for the day as well as my maximum intraday drawdown. Then have my girlfriend check it every night. I think that might help me from doing anything stupid because I have to show someone else my results no matter what, which would make me less likely to blow 10% of my capital in one day. Basically someone other than myself holding me accountable.
Click to expand...

Create a journal in the journal thread. Writing down your day and stakes, positions and stop losses etc can give you an education in itself. As trading can be very dynamic we forget the previous day with the present day do to the intensity and overload! You would learn greatly from this and mo doubt others can learn from your gains and mistakes too!

And Masq, I do need to use fixed stops. I've used mental stops because I hate placing physical ones, but that gets me in trouble more than anything
Click to expand...

Ironically be very carefull when deploying stops. I can't stress enough how much the stop loss topic is blown out off proportion.....all people read is stop loss, stop loss, stop loss! Yes it can save you but it doesn't make you a better trader for it. Many traders read the stop loss stuff and think aaaahhh ok, i'll whack it right here! lol They generally place stop losses incorrectly: not enough breathing space, too tight and traders don't even tend to know what ATR is, which is absolutely ironic. ATR - average true range is the average movement of your market over a given time and this can help in deciding where a comfortable stop loss should be!

Please read the following:

http://www.trade2win.com/boards/us-indices/85794-my-trades-us-majors-forex-oil-7.html#post1051562

It is not a perfect book answer but should give you an insight into being carefull with stops and not thinking suddenly that stop losses will be your perfect answer. When I see your scenario - stake sizes and over trading would be the bigger problem - stop losses would be one of the secondary ones.

(y)

Kind Regards
User
 
User said:
Create a journal in the journal thread. Writing down your day and stakes, positions and stop losses etc can give you an education in itself. As trading can be very dynamic we forget the previous day with the present day do to the intensity and overload! You would learn greatly from this and mo doubt others can learn from your gains and mistakes too!


sound advice, providing it doesn't affect your trading it might be worth keeping an open an honest journal for t2w at large to view and it might help set you on the straight and narrow. who knows maybe you'll pick up some jems from people who've faced the same problems themselves and managed to conquer them.
Click to expand...
 
This thread in particular has helped me immensely, even though I am only just barely starting out in my trading life. Can anyone help me develop a sound trading PLAN, as I've heard on these forums but have yet to embark on?

Thanks!
DJ
 
wh92stang said:
I agree that professional traders only trade truly profitable setups, but that doesn't mean someone cannot trade every day and be a professional trader. Some professionals have an edge scalping quick moves every single day. But I do understand your point. Wait for true setups, anything else is gambling.
Click to expand...

I day trade only, and have done for over a decade, I never under any circumstances keep a trade open over night, I trade FX only and focus on 2 pairings, I regard myself as a short term momentum trader, not a scalper and look to trade 2 or 3 times a day maximum with consistency. I trade a set up, which is simple, allows me to enter and exit trades with ease and little thought, more mechanical, based on my set up I suppose, I trade set stops and limits, never add to a losing in the hope I will get it back, I take the losses along with the wins, I trade 1:2 risk /reward. I record the statistics of every trade taken and those not taken to maintain a statistical database of my trading to enable me to be on the top of my game at all times.

Don't get greedy it has an uncanny knack of biting you when you least expect it, if you want to increase your exposure, do it gradually and within managed and sustainable limits.

Just my 2 penneth, good luck
 
Dinos - that sounds almost exactly like the type of trader I'd like to become. Can you point me in the right direction on how to get started in that area? I've looked into IB as a broker but was wondering if a US-based broker would be better for me.
 
Just copied this from another thread on here from SHANGHAI, for me this says it all,

"The single biggest piece of advice I would give is that there is no holy grail that is only available to the successful traders and institutions. Most profitable traders make their money from simple strategies but they execute those with great discipline and experience. They also understand the market conditions that those strategies work best under."

Couldn't have put it better myself.
 
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Dinos said:
I day trade only, and have done for over a decade, I never under any circumstances keep a trade open over night, I trade FX only and focus on 2 pairings, I regard myself as a short term momentum trader, not a scalper and look to trade 2 or 3 times a day maximum with consistency. I trade a set up, which is simple, allows me to enter and exit trades with ease and little thought, more mechanical, based on my set up I suppose, I trade set stops and limits, never add to a losing in the hope I will get it back, I take the losses along with the wins, I trade 1:2 risk /reward. I record the statistics of every trade taken and those not taken to maintain a statistical database of my trading to enable me to be on the top of my game at all times.

Don't get greedy it has an uncanny knack of biting you when you least expect it, if you want to increase your exposure, do it gradually and within managed and sustainable limits.

Just my 2 penneth, good luck
Click to expand...

Good to see you back man, top advice (as always) :smart:
 
oildaytrader said:
Most pussies think they are ready to trade in one year.All these pussycats are S and P traders ,counter trend monkeys,support and resistance traders /random zone traders and swingers on Tarzan's rope.

Clicking a mouse button and placing a buy or sell order isn't trading,it is gambling buy is black and sell is red, your broker did not tell you that.You need knowledge and skill before clicking the mouse.

All these gamblers who are not professional traders but gamblers.

Professional don't trade every day, and some days do not need to trade at all.Those who rely on a daily wage are f**cked up traders who often trade without an edge.They will only see true profitable set ups two or three times a week, the rest is gambling.

It will take several years to be consistently profitable.

Does that help?
Click to expand...

I don't know if I would have put it the same way as you Oil, but you are absolutely right. Takes most people years to figure this out.
 
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