TOTW What's the dumbest trade mistake you ever made?

[SpreadDoctor]

I stand corrected.

It appears one or two others have followed our lead

Alex

________
Alexander Chadwick
Alpari (UK) Representative

The biggest mistake I made was listening to Brokers or anyone else who wanted to take my money.

 

[TwinToWin]

My dummest are yet to come... probably!

I started in 2007 looking to get rich quick while I had a a little spare cash. My belief that I somehow knew the market was due a correction encouraged me to lose my first £1k because I really knew nothing. I tried again when the market pulled back and increased my long bet size "to win it all back" and watched it plumet again with my biggest loss to date of £800 in 20mins. The next 3 month I got better and learned a lot then left my account untouchedfor 7 years with tiny pot to play with.

Now I do more more learning than trading, but I still have to work....Like casinos every lesson costs you money !

 

[SpreadDoctor]

I have made many mistakes and continue to do so. Here are a few in no particular order:

1. Losing £7k in one trade because I was stubborn.
2. Letting a larger winning trade come back for a loser.
3. Being influenced by countless people who did not know how to trade profitably.
4. Being influenced by companies who's only goal is to take my money.
5. Making £11k on one trade and putting it down to skill when it was pure luck.
6. Letting the market trick me into trading rather than sitting back calmly and waiting for it to come to me - i.e. letting the market be my bitch. lol
7. Listening to traders who have been in the game less than 10 years.
8. Thinking trading was all about excitement, high fiving each other, high octane. Reality is if you are a home trader it's lonely and tedious, if you are a prop trader the floor is largely silent apart from the occasional burst of anger when someone does their account and smashes something.

I distinctly remember physically crying over #1 and I am not a blubber. GL

 

[Sonicscooter]

Good stories, nice to see peeps having the balls to confess.......all good fun.

Cheers Chaps..........

 

[SlowlyButSurely]

Same as most:

Over Trading
Over Confidence leading to recklessness
Revenge Trading

Worst trading move I've made was trying to pick the bottom on the DAX during one of its huge trending moves. Learnt a great lesson then.

 

[Sonicscooter]

That is really an awful mistake.
It could have destroyed your account, you were lucky to come out flat

Hi, it was one of those events where you look at the monitor and do not believe what your eyes are telling you, then your brain scrambles for reasoning.

It could have soon moved several thousand pounds.

Regards Shane.

 

[robster970]

I distinctly remember physically crying over #1 and I am not a blubber. GL

Crying, not yet. Nausea, yes. Numb, hollow and empty, many times.

 

[postman]

Crying, not yet. Nausea, yes. Numb, hollow and empty, many times.

You need to trade moar size

On second thoughts your probably doing exactly the right thing.

 

[darktone]

Crying, not yet. Nausea, yes. Numb, hollow and empty, many times.

Lightweight!

 

[rsh01]

I have made many mistakes and continue to do so. Here are a few in no particular order:

1. Losing £7k in one trade because I was stubborn.
2. Letting a larger winning trade come back for a loser.
3. Being influenced by countless people who did not know how to trade profitably.
4. Being influenced by companies who's only goal is to take my money.
5. Making £11k on one trade and putting it down to skill when it was pure luck.
6. Letting the market trick me into trading rather than sitting back calmly and waiting for it to come to me - i.e. letting the market be my bitch. lol
7. Listening to traders who have been in the game less than 10 years.
8. Thinking trading was all about excitement, high fiving each other, high octane. Reality is if you are a home trader it's lonely and tedious, if you are a prop trader the floor is largely silent apart from the occasional burst of anger when someone does their account and smashes something.

I distinctly remember physically crying over #1 and I am not a blubber. GL

ditto: 1,2,6,8.

6 is still a WIP.

 

[ACstudio]

My dumbest was a real good one, it's my dumbest because it was my most costly. These days I laugh about it and it was all part of the learning curve and earning my stripes as an Options trader.

15 minutes left in the markets before options expiration. I decided to get some sleep after being up all night trading. Just after crawling into bed I hear the closing bell being rung and then an order get filled, "wtf was that" ... curiosity gets the better of me so I get up...

"WTF, oh my god are you f'ing serious... (more) WTF's"... followed by a lot of other colourful language as I see an ATM Vertical Call Spread filled for .03. 15 more minutes of after market remaining with no control at all as the markets are closed and then the Options expire.

The stock runs .01 or .02 'In The Money' and I am guaranteed an options exercise. It's New Years Eve and after a couple of days stressing about the new position and upon the markets opening on New Years Day it gaps up and rallies against my +$320k short position and within 30mins I blow my entire account.

Happy F'ing New Years to me....

lessons learnt:
- close all orders before going to bed.
- cover (exit) all assignments on opening rallies don't wait for a pull back.
- lady luck isn't on my side like she has been on others I know with assignments so always close all potential short options before expiration bell rings.

Forgive me if I'm missing something....but why didn't you exercise your long call position to neutralize the position as this can be done immediately or through the following day...or ?. You said the order filled right before market close so it looks like this wasn't an open position left to expire worthless. The way I'm reading it is that you had an order to open a spread for .03 credit for options that are about to expire ....then the order filled....then markets closed (or the other way around) but the underlying continued to move against you resulting in exercise by the following morning. Seems you could have exercised your long calls and covered the short position and only been down the width of the spread minus credit received x's # of lots.
Still learning so I'm guessing I missed something.

 

[iMusingKiMi]

There are always some dumbest trade, because human makes mistake. But We must always learn from mistake. I believe as long as we don't argue to the market, because trading is just like fishing. We have those fishing rod, fishing line, some lure, but we don't control those fish to eat our baits. Let market do the job instead of asking the market to follow our bait, right?

 

[lloydbee]

Forgive me if I'm missing something....but why didn't you exercise your long call position to neutralize the position as this can be done immediately or through the following day...or ?. You said the order filled right before market close so it looks like this wasn't an open position left to expire worthless. The way I'm reading it is that you had an order to open a spread for .03 credit for options that are about to expire ....then the order filled....then markets closed (or the other way around) but the underlying continued to move against you resulting in exercise by the following morning. Seems you could have exercised your long calls and covered the short position and only been down the width of the spread minus credit received x's # of lots.
Still learning so I'm guessing I missed something.

1. The order was filled after the market closing bell
2. I didn't exercise my long option because it was my first experience in this
3. The market had closed so there was no exercising that day anyway or the next day, that is Saturday and was New Years Eve.
4. Upon assignment you have a 50/50 chance of the stock going the correct direction making a profit.

It was no big deal and all part of learning, it's one of those stories to laugh about. Ones we all have as traders.

 

[splashy]

When i first started trading i traded some silly exotic commodity, a metal i think, but i hadn't noticed that the spread had widened ridiculously for some reason (from something like the usual 5 to 100)! The trade also went the wrong way. I lost £100 on the trade and £300 on the spread. It was a small fortune for me at the time and i still remember the pain.

 

[iMusingKiMi]

When i first started trading i traded some silly exotic commodity, a metal i think, but i hadn't noticed that the spread had widened ridiculously for some reason (from something like the usual 5 to 100)! The trade also went the wrong way. I lost £100 on the trade and £300 on the spread. It was a small fortune for me at the time and i still remember the pain.

Those were the days. But how could it be 5 to 100? Weekend trade?:-0

 

[SlowlyButSurely]

Those were the days. But how could it be 5 to 100? Weekend trade?:-0

Banks/MM's etc have to offer certain products (perhaps under obligation etc) but if they don't want people to trade it, they just set the bid/ask wide and no one will normally trade it...except for some unlucky, unaware souls!

 

[ACstudio]

1. The order was filled after the market closing bell
2. I didn't exercise my long option because it was my first experience in this
3. The market had closed so there was no exercising that day anyway or the next day, that is Saturday and was New Years Eve.
4. Upon assignment you have a 50/50 chance of the stock going the correct direction making a profit.

It was no big deal and all part of learning, it's one of those stories to laugh about. Ones we all have as traders.

Whew, that's a bad one. But just so I understand so I don't make the same mistake.

The market closes so you can't buy or sell options....but the actual expiration is Sat and can be exercised through then. I've had shares put to me and called away on several Saturdays from early exercise....scared the hell out of me the first time but figured out I could just exercise my long calls thus flattening the position. So the mistake in the end was not exercising your long calls?

Appreciate you sharing your story...I've learned several lessons the hard way, like ex dividend dates and in the money short calls....just wanted to make sure I wasn't missing anything that a I'm sure could happen to anybody and maybe learn from your experience.

 

[DiggerOfTruth]

My biggest error was not realizing that brokers like ThinkForex (STINKForex) & ******** (SNOTForex) use the Virtual Dealer plugin to sabotage their client's trades!! BOTH brokers did this to me, back to back. Thieves and liars....

Finding a trustworthy broker is one of the biggest needs before trading live. Never think that a Demo on any broker will translate into real-world successes. Evil brokers use their Demo to hook ya. Then steal from you!!

 

[postman]

A pint of Murphys anyone?

 

[iMusingKiMi]

My biggest error was not realizing that brokers like ThinkForex (STINKForex) & ******** (SNOTForex) use the Virtual Dealer plugin to sabotage their client's trades!! BOTH brokers did this to me, back to back. Thieves and liars....

Finding a trustworthy broker is one of the biggest needs before trading live. Never think that a Demo on any broker will translate into real-world successes. Evil brokers use their Demo to hook ya. Then steal from you!!

Mate, no offense. This is the best video for you.