Trading Update: 1st Qtr Performance Stats – The Ugly, The Bad, and The Good Part 2 of 4


Anyone who has ever invested knows taking on a market position is synonymous with risk. The market sword cuts both ways with either profits or losses.

The first quarter was some rough sledding (Ugly)…


Feb 2015 Performance

Feb 2015 Perf


Feb 2015 Performance Vs Indices

Feb 2015 Vs Ind


March 2015 Performance

March 2015 Performance Vs Indices

Mar 2015 Vs Ind

One word- ouch. Posting losing months is no fun – it feels like taking a failing grade and parading it around at a social gathering. there are very few blogging traders that post ALL their monthly trading results rain or shine as it can really do a number of your ego as well as attract lots of critical feedback. I salute traders who continue to diligently post despite having a string of big losses- that’s true transparency. Trading is after all, a risky business and people should be made aware of the risk that is involved by seeing actual losses.

So performance was awful, and the “after trade analysis” is where you can convert losses into future gains by figuring out what the trading system problems are. In my case, I was working on refining my trading system that was now incorporating what I observed to be a great pattern reaction. I thought I had implemented in the system correctly with prior results – and I did based on early trades. But looking back, I realize it was a partial implementation where I had yet to fully understand the patterns I had noted. This caused me to get stopped out of my trades time and time again being just a little off before the market would reverse and go in the direction I had anticipated. Then on one or two occasions I made some wide stops to try to mitigate these reversals and Murphy’s Law went into effect with me being wrong and the market still stopping me out with a big stop loss.

Trying to find a working trading system can be frustrating, but when you know you have the keys to a great system and you are still messing up only adds to that frustration. Trading is a lesson in self discipline since you have to solve all your own problems. Having no boss means the freedom to keep making the same mistakes if you choose. Losing performance was the price I paid for trying to take the “fuzziness” out of my trade system.

1st Quarter Performance

2015 1st Qtr

1st Quarter Performance Vs Indices

2015 1st Qtr Vs Ind

As I stated in part 1, the account size is smaller, so losses or gains will project out as bigger swings. The initial gains were under the “fuzzy” system where I was looking at a complex set of patterns that took time to develop, but worked. While the system worked, there was still too much uncertainty in terms of target estimation once a trade was entered. If I had stayed with it, I likely would have developed losing performance anyway over time due to those uncertainties.

The lesson here is even if you are certain of a winning pattern, you may still need more time than expected to figure out all the details.




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