my journal 3

This is a discussion on my journal 3 within the Trading Journals forums, part of the Reception category; Yeah, this is my practice so far with "the chart game". Saving it here as a back-up: practice_results.xls...

Reply
 
LinkBack Thread Tools Search this Thread
Old Jul 3, 2013, 7:00pm   #3256
 
travis's Avatar
Joined Mar 2003
Re: my journal 3

travis started this thread Yeah, this is my practice so far with "the chart game". Saving it here as a back-up:
practice_results.xls
__________________
Read: E.P. Chan, Cogneau - Hubner, Sewell, Tverberg. Search: expected shortfall, Monte Carlo VaR, extreme value theory. Trade.
travis is offline   Reply With Quote
Old Jul 4, 2013, 6:51pm   #3257
 
travis's Avatar
Joined Mar 2003
Re: my journal 3

travis started this thread
__________________
Read: E.P. Chan, Cogneau - Hubner, Sewell, Tverberg. Search: expected shortfall, Monte Carlo VaR, extreme value theory. Trade.
travis is offline   Reply With Quote
Old Jul 4, 2013, 7:33pm   #3258
 
travis's Avatar
Joined Mar 2003
Re: my journal 3

travis started this thread Practice update:
practice_results.xls
__________________
Read: E.P. Chan, Cogneau - Hubner, Sewell, Tverberg. Search: expected shortfall, Monte Carlo VaR, extreme value theory. Trade.
travis is offline   Reply With Quote
Old Jul 6, 2013, 12:05pm   #3259
 
travis's Avatar
Joined Mar 2003
Re: my journal 3

travis started this thread As in your everyday life, you need to recover from disturbing events, in order to recover your judgment, and make reasonable choices - in trading all this is magnified.

It'd be interesting to compile a list for exactly how much time you need to recover from each specific event, in your daily life, and in your trading life.

Examples:
1) recover from a loss: 10 minutes
2) recover from a win: 5 minutes (this, too, makes you lose your balance)
3) recover from someone yelling at you: 10 minutes
4) recover from someone staring at you: 5 minutes

The advantage is that, whereas in real life some things need an immediate reaction (such as if you're in the street and someone starts yelling at you), in trading you have the luxury to take time off, all the time you need. But first you need to identify the effect of events on you, and their clouding your judgment.

Thanks to the chart game, I am assessing, with precision, the effect of these events (at no expense), and appraising the necessary time to take off in order to forget the emotions triggered by given thoughts or trading events (euphoria and sense of invincibility after a win, despair and discouragement after a loss - both emotions adversely affect your trading choices).

I might not be able to achieve imperturbability, no matter how hard I try, and I have been trying. It might improve, but my emotions may never disappear completely. On the other hand, I can definitely achieve this: understand how much time I need to get over a given event and subsequent emotion. Discretionary trading is also this: assessing, in your quest for profitability, how your mind works, in practical terms.

Cronometro online

A similar stopwatch / timer approach can be applied to... urges, which are also emotions, that go away after a given period of time. You feel the urge for an ice cream. Well, that, too, goes away if you wait. You don't really need to struggle to neutralize your urges. All your really need is to train yourself to wait. Wait before you talk, wait before you reply, wait before you trade.

A loss at the chart game will be forgotten after 10 minutes, effectively. The bigger the loss, the longer it will take. It is pointless to try to make it back, because your trading choices will be adversely affected by that desire.

A loss at the chart game will take, on average, 10 minutes to be effectively forgotten. A... let's say a 33% loss (or missed profit to a similar extent)... will take a few days to be forgotten. I would say that the ratio, the scale of realism of the chart game to real trading is, while being constant in all its aspects and emotions involved, about 1 to 100.

Everything requires a given amount of time.

I could pretend, at the chart game, that I am over a loss immediately, but that's not the way it is. For some reason my mind requires 10 minutes. I might go on for my entire life trying to make myself get over losses (in trading and in life) immediately, and it might never work. What is the point of banging your head against the wall over and over again, when there is such a simple alternative? That alternative is waiting.

So, that 10 minutes, make it even 20 minutes for when you tried your absolute best, required by the chart game loss to be digested becomes... in real trading... days. So it's not just 1 to 100, but rather 1 to 500. Yeah, because one day is made of about 100 15-minute periods, so if I require 5 days to forget in real trading what I require 15 minutes for the chart game, then that's a ratio of 1 to 500.

I might need to work on shortening that amount I wait, and I need to digest emotions and event triggering them. But the principle is correct.

As a trader, your approaching to your everyday life is to see as a useful test to measure your emotions. You should not view a blow to your ego as "how do I reply to this?" but as "let's see how many minutes it will take me to get over this". You should therefore walk around with a stopwatch and an entirely new attitude.

Among the many things that one could do, to make sure he's fully in control of himself, and not at the mercy of his emotions, a person, or rather, I, could try, or rather will try, or rather I will find useful to try to freeze for 5 seconds, exactly. That is enough to ask yourself if you're fully in control, and stop whatever else, outside of your control, and against your self-interest, you were doing. I think it is one excellent habit. For example, you could avoid or interrupt so many useless arguments. What is an argument, most of the time, if not you wasting time, at the mercy of your ego?
__________________
Read: E.P. Chan, Cogneau - Hubner, Sewell, Tverberg. Search: expected shortfall, Monte Carlo VaR, extreme value theory. Trade.

Last edited by travis; Jul 6, 2013 at 1:55pm.
travis is offline   Reply With Quote
Old Jul 6, 2013, 7:07pm   #3260
 
travis's Avatar
Joined Mar 2003
Re: my journal 3

travis started this thread I was prudent, for months. After reaching that 38k, I lost a large percentage of it, so I had to start all over again, and realize my mistakes. My methodology was unprofitable but I had been lucky. That type of thing, where you 9 times of 10 it works, and on the tenth effort, you lose most of your capital. I had been right all the way to 38k, when my capital started to decline, all the way to below 20k.

At any rate, I started all over again, and worked on my self-control - and it was a rewarding experience, not just for my trading, because in fact it hasn't paid off yet, but also for my daily life. Self-control is an amazing instrument and wonderful field to study. Because, the more you can control yourself, the more you can control others, too, through their reaction to your behavior. Even just learning to keep quiet most of the time was a pretty powerful achievement. Or going to bed on time. Or also, not scratching my head. Or not getting a beer once a week, but only on social occasions, which for me it means once every 3 months.

Anyway, today I am going to celebrate, because I am grasping myself, my own emotions (cfr. previous post), the time I need to erase the harmful emotions from my mind, and I am going to celebrate because, at least on the chart game, I have found out... or at least, so far I seem to have find out how to be profitable.

And I am saying this only because it's been hundreds of games, but I'll play thousands more, until I figure it to a science.

I am very satisfied with myself, first of all because it was damn boring but I didn't quit and found a way to make it work.

Here's the results so far (each cell is one stock played, until I felt like it):
chartgame.com_practice_results.xls

With this methodology I've only played 135 games (hundreds more with previous classifications and methods - I used to take pictures of every stock played), of which the last 16 were all profitable. I am not saying I'll always be profitable with every stock I'll play, but my estimate is that I've learned how to be profitable, at least at the chart game.

Then it will take a lot more practice on this to become stable as much as I want to be. And even more practice to achieve this with real money. But I am grasping the right principles. Self-control, and dealing with emotions, by using time against them.

At any rate, I am not here to show off, but just for the few readers interested in my thoughts. Because I've also learned modesty and to kill my ego, as this quote by b.c.lund summarizes perfectly:
10 Things I Wish I Knew When I Started Trading | The bclund BlogThe bclund Blog
Quote:
What’s more important to you, having everyone you know idolize you because you’re “trader”, but lose money, or have everyone think that you are just some schlub who works in an ice cream store, while in fact you are really making a fortune in the markets?
There's a lot of wonderful tricks that trading will teach you for your daily life, and I am fine with the idea of being considered the "schlub who works in an ice cream store". No more worrying about my reputation from now on. Another waste of time anyway.

...

If anyone cares, here's my latest index.html as well:
index.html
__________________
Read: E.P. Chan, Cogneau - Hubner, Sewell, Tverberg. Search: expected shortfall, Monte Carlo VaR, extreme value theory. Trade.

Last edited by travis; Jul 6, 2013 at 7:26pm.
travis is offline   Reply With Quote
Old Jul 8, 2013, 5:51pm   #3261
 
travis's Avatar
Joined Mar 2003
Re: my journal 3

travis started this thread travis-bickle-goes-movies.jpg
__________________
Read: E.P. Chan, Cogneau - Hubner, Sewell, Tverberg. Search: expected shortfall, Monte Carlo VaR, extreme value theory. Trade.
travis is offline   Reply With Quote
Old Jul 9, 2013, 5:52am   #3262
 
travis's Avatar
Joined Mar 2003
Re: my journal 3

travis started this thread
__________________
Read: E.P. Chan, Cogneau - Hubner, Sewell, Tverberg. Search: expected shortfall, Monte Carlo VaR, extreme value theory. Trade.
travis is offline   Reply With Quote
Reply

Thread Tools Search this Thread
Search this Thread:

Advanced Search

Similar Threads
Thread Thread Starter Forum Replies Last Post
my journal Fuzzybid Trading Journals 16 Jul 17, 2011 5:49pm
My Journal for all to see herronryan Trading Journals 44 Aug 26, 2010 4:32pm
A journal arabianights Trading Journals 66 Jan 10, 2010 1:09pm
My little journal. HaloTrader Trading Journals 16 Jun 26, 2009 12:02am

Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)