Nowler's Trading Journal

This is a discussion on Nowler's Trading Journal within the Trading Journals forums, part of the Reception category; Originally Posted by Quantt Hello Gavin, I like your story and admire your openness, so I really hate to burst ...

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Old Oct 6, 2017, 4:48pm   #16
Joined Sep 2017
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Originally Posted by Quantt View Post
Hello Gavin, I like your story and admire your openness, so I really hate to burst your bubble, but those numbers are just crazy, consider the most successful hedge fun in history is averaging 70% per year! Any hedge fund above let say 20% (2xthe market) on average per year is consider very good...

Here are calculations with 5% a week over 10 years with staring capital of $1000 = you'll have $185 437 424 464 626 and will be the richest man in the world... Here is the result for your 10% for just 5 years: $25 547 139 533 267 132 , I don't think we have that many grains of sand on the planet...

Frankly speaking you cannot make living with starting capital of $1000, $10000 or even $100000 , so the faster you realize it, the better it would be for you...

Sorry mate...
Hello and thanks for the input my friend!
I also really appreciate the cautiousness at letting me down

I may be incorrect about making, on average, 10% per week. It was just a figure I was currently around at the time and I wanted to set a target. If it's less then it's less. I am only 4 months and 3 weeks knowing what trading is. I do however disagree with some of what you say, or at least accuracy of some of it.

I noticed your name and immediately noticed that we have considerable polar opposite machine parts in our systems. In fact, one could probably easily argue that you are the one with cogs in the machine and that my "machine" is run by different parts...perhaps some sort of adjustable pulley system.

I read your profile in order to build up a mental representation of who you are as a trader and where you're coming from. It seems that you are a strong believer in mechanical trading? As opposed to discretionary trading? In fact, you would probably deem discretionary trading as a very bad idea? Would this be correct?

As I said, I may very well be wrong. I have no long standing impression of this trading world, so who am I to say you are wrong? But I really must (with my shallow pool of trading experience) disagree to some point with what you said.

While I don't really know the ins and outs of hedge funds, I assume that they are very strictly run in a mechanical way? At least for the most part? I have been listening to a lot of people and from what I gather, in terms of freedom to trade, they are an elephant and I am an hawk. While they are big and experienced, like the elephant they are less mobile than the hawk. I can make a trade in an instant if I wanted, they have red tape to get past. I remember hearing a few people say that dockets have to be filled, filed and approved before these big boys (banks/hedge funds, whatever) can execute a new trade. I on the other hand I am the judge, jury and executioner. Another thing to consider is their motivation compared to mine...

I highly doubt that many of them working harder on this than I am! They very well might have worked as hard or maybe even harder than me when they were at the same stage. I doubt it though. I have taken to this like a duck to water! I'm not saying that I know it all, i'm just saying that I thoroughly enjoy this on so many levels! The discipline! The challenge! It's so humbling! I also have the motivation of providing a better life for my family (even if they are unsupportive pains in my ass). I am not doing this so I can roll around in money. We are poor! What many traders would scoff at would take huge financial burden off of us! Most likely extending our lifespans...

Another thing is that those big boys are not willing to risk as much as me. I don't think I am wreckless either. I may be overextending a bit by placing 4% on some trades but I certainly see a place it. It can be scaled on either if the situation allows for it by jumping on again after a retracement or whatever. Even if I was to rein myself in a bit and only go beyond 2% when it's a retracement on a strong trend, or some other very high probability trade. Then I could perhaps scale up to 4%...

Also, perhaps I should have been clearer but I don't plan on making such % returns for a long time. I would like to, over time, reduce the time I spend trading, reduce the risk per trade, as well as the leverage. This is all negatively correlated with my capital. The larger that grows, the lower my risk and effort gets. I like trading but I don't want to spend all of my days staring at the screen

In regards to your calculations.
I was only throwing out figures as rough estimates. Even by just projecting the 10% per week ahead, it built up a mental representation that I can now work with. I can manipulate it and play with scenarios. I know it's insanely unlikely to be able to turn over such returns each and every week. It's just an educational estimation.
However, my biggest criticism of what you said was the part about not being able to make a living if I started with 1, 10, or even 100k! Again, I am poor my friend. If I had 100k then I would only need to make .8% per month to be better off than I currently am. If I had 10k capital then I would need to make about 8% per month to be better off than I currently am. Then with 1k capital I would need about 80% per month to be better off.

I know for a fact that apart from luck, I wouldn't be able to equal my current income with just 1k capital. 10k however, I am very optimistic. I may be wrong but I currently disagree with your certainty. I also said that I was not just trying to turn 1k into a living. I am committing to this for the long haul. I will be adding capital injections when I can too. I am trying to get a few things going also.

I am after buying a few domain names and plan to try gain revenue for my trading account from the ads on those. Even if it's only a trickle, it better than nothing. At the very least it's a hobby and with the following bit, I gain some presentation skills/experience. One this sites is a trading site too which is basically an educational site such as investopedia (not published yet as I need to gain more experience). I got myself a budget green screen, recording setup, marker board etc for going through the basics with beginners (videos on youtube too). Eventually building it up to advanced. I also like to play darts. I have a board up and can trade from the same room. So it's basically a distraction from staring at the screen but also allows me to be close by if I need to intervene in an ongoing trade and also offers a possibility of additional income, maybe.

I am quite fond of darts and I would like to enter a few local competitions and maybe if I become good enough I can enter the lower competitions internationally. This fits hand in hand with trading. Both complement each other and both can be done on the road. I am probably not good enough to win money at it yet but hypothetically, if I did make very small money from it, as long as my travel costs are covered then I can feed the rest into my account.

Also, didn't Charlie Burton turn 10k into 100k in 2 years and 9 months? I may be a little off but wasn't his whole selling point that his account was there for everyone to see? Verifying that he did in fact do it? He set out to do it in 2 years but it took almost another year. I am not basing my hopes on that of course. That's just an additional bit for my view of things.
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Old Oct 6, 2017, 5:01pm   #17
Joined Sep 2017
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Originally Posted by piphoe View Post
Hi Nowler, I gave you your first thumbs up, good luck & don't let me down
Thanks!
I'll do what I can
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Old Oct 6, 2017, 5:02pm   #18
Joined Feb 2017
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Originally Posted by Quantt View Post
Hello Gavin, I like your story and admire your openness, so I really hate to burst your bubble, but those numbers are just crazy, consider the most successful hedge fun in history is averaging 70% per year! Any hedge fund above let say 20% (2xthe market) on average per year is consider very good...

Here are calculations with 5% a week over 10 years with staring capital of $1000 = you'll have $185 437 424 464 626 and will be the richest man in the world... Here is the result for your 10% for just 5 years: $25 547 139 533 267 132 , I don't think we have that many grains of sand on the planet...

Frankly speaking you cannot make living with starting capital of $1000, $10000 or even $100000 , so the faster you realize it, the better it would be for you...

Sorry mate...
Not to mention Rentec has averaged more like 35% in the more relevant past 10 years and they barely touch outrights with a firmwide ave hold time of 8 seconds. All while paying approaching zero OTC comms and trading inside the spread.

I like the OP and his attitude and am hoping he moves into the headspace of building a track record rather than building a fortune.
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Old Oct 6, 2017, 6:52pm   #19
 
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Originally Posted by Nowler View Post
Hello and thanks for the input my friend!
I also really appreciate the cautiousness at letting me down
Hello again,

Yes, I am a systematic trader, just because I am lazy and cannot do the same thing over and over, I am always looking to automate it and certainly I cannot imagine spending my days staring at charts… (and I don’t believe in leverage either, that’s why I do not trade options, forex and futures…)

All that said I am not judging your methods, I have heard of a trader that uses astrology and makes money, so to whatever works for you…

Hedge funds are the people you trade against, do not under estimate them, the are faster, smarter and have more knowledge then you, just because they have a lot more computer power and a lot more people working on this 24/7…

Again you are talking about making 8% a month as a given and frankly if you can constantly make 8% a year it would be a miracle (considering your risk and leverage), so 10k will not be enough…

Regarding your trading educator’s inspirations, please do not do it! This is the classic example: failed trader selling the dream to gullible newbies, just in this case I hope you end up in jail, where all those scammers belong, so it is not worth it, no matter how poor one can be…

I have no idea who Charlie Burton is, so I had to google him, looks like every other chatroom out there with no verified track record, so I cannot take him seriously…

Good luck tough, the darts angle looks very interesting…
__________________
"If you don't find a way to make money while you sleep, you will work until you die." Warren Buffett, CEO of Berkshire Hathaway.

Count de Money number 1 trading rule: EDUCATE YOURSELF!

Before you trade even single penny on the stock market, please spend the time and educate yourself by back testing different trading strategies and ideas - go to eBay and search for "historical stock market data", you can buy 20 years of data for less than $100 - that's all you need to start.
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Old Oct 6, 2017, 6:55pm   #20
 
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Originally Posted by Fill_Or_Kill View Post
Not to mention Rentec has averaged more like 35% in the more relevant past 10 years and they barely touch outrights with a firmwide ave hold time of 8 seconds. All while paying approaching zero OTC comms and trading inside the spread.

I like the OP and his attitude and am hoping he moves into the headspace of building a track record rather than building a fortune.
Yep, Renaissance Technologies is what I had in mind... Cheers!
__________________
"If you don't find a way to make money while you sleep, you will work until you die." Warren Buffett, CEO of Berkshire Hathaway.

Count de Money number 1 trading rule: EDUCATE YOURSELF!

Before you trade even single penny on the stock market, please spend the time and educate yourself by back testing different trading strategies and ideas - go to eBay and search for "historical stock market data", you can buy 20 years of data for less than $100 - that's all you need to start.
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Old Oct 6, 2017, 11:04pm   #21
Joined Sep 2017
Nowler started this thread If I cannot make it as a profitable trader then educating others would not be my place. I have very strong morals. I'm not even planning on charging people for it. My income is a result of the traffic through the site. But if I cannot make money trading then I wont do it. Obviously. Well perhaps not "obviously"... the internet is saturated with "guru's" and couldn't-do's teaching others.

Anyway, thanks very much for the input. I definitely have some food for thought!
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Old Oct 7, 2017, 12:20am   #22
Joined Sep 2017
Nowler started this thread I am considering setting myself a target for the final week of month 5.
If I can reach the target then I will reward myself by depositing another €20 onto the account.

Since I made this journal 8 trading days ago, I am up 3.4%
Considering 3 of those days I didn't trade (ill/busy) and then I also took some experimental trades, some of which cost me and also took up my time... I think it's a very motivating % increase!

The official target for this month was to experiment with increased capital risk and gain a better understanding. I am still 1 week shy but since I am up money this month...and if I finish next week in the green for the month, then that months target was a huge success

Fingers crossed the next week offers me a few good opportunities. I'm expecting the USD/SGD to offer up a few long opportunities. Perhaps even just longing it on Monday and riding it until Friday or until some big releases if there are any
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Old Oct 7, 2017, 1:05am   #23
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Nowler,

Your attitude and willingness to positively change your personal circumstances is highly commendable. I wish you success and that you will achieve a better life for yourself through your efforts.

Having said that it is also important to understand what you set out to accomplish is undergirded by reality and facts and not by hope and blind optimism. You should know that having done a psychology major that we are inherently bias and I can see that you are subject to confirmation bias (what you want to see to support your case); recency bias (judging your overall trading skills based on recent successes); and plainly just over optimistic.

As a starting point, we should benchmark trading performance against what is happening out in the market place. In other words, how other professional currency traders are performing in making a living. I am talking about verified results and not those unverified BS claims out in the internet space.

Some of the top 15 currency traders can't even make a positive return every year and these are the best of the best (audited accounts). The bottom 10 in the ranking actually loose money over 5 years and these are professionals. Refer to the attached files.

You are aiming to perform better than every one of them. What makes you think that you can perform better than them besides on hope and optimism? When you have a 5 year record which supports your claim then at least that is the basis. Making money consistently is very hard to do. You only have 4 months of trading. Are you so sure that some of your success is skills based and not just luck? Each trade is frankly a random distribution of events. If you can achieve success consistently over a long period then possibly skills outweigh luck in terms of probability. Until you have a long enough track record, you are counting your chickens prematurely.

I would also touch on a topic which is not discussed at all. Risk and return are tied together. If you are going after big gains you are in fact taking on more risk. What is absent from the conversation is drawdown. In evaluating returns, the performance metrics that professional investors look at is not just return but more importantly drawdown. This is the main reason why leverage is used sparingly because of its effect on drawdown. If you can achieve 30 % return with a drawdown of 15 % or less, every fund in the world will line up to engage your services. If you can deliver a smooth equity curve with limited drawdown, you can offer your signal services through copy trading. You don't need a large equity to live on trading. A good trading record can generate good income. There are many ways to skin a cat. Taking on outsized risk to grow equity is a sure way to terminate your trading ambition.
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File Type: pdf Bottom10rankingFX.pdf (76.8 KB, 98 views)
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Thanks! The following members like this post: Kaeso
Old Oct 7, 2017, 4:27pm   #24
Joined Sep 2017
Nowler started this thread
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Originally Posted by Brumby View Post

Having said that it is also important to understand what you set out to accomplish is undergirded by reality and facts and not by hope and blind optimism. You should know that having done a psychology major that we are inherently bias and I can see that you are subject to confirmation bias (what you want to see to support your case); recency bias (judging your overall trading skills based on recent successes); and plainly just over optimistic.

As a starting point, we should benchmark trading performance against what is happening out in the market place. In other words, how other professional currency traders are performing in making a living. I am talking about verified results and not those unverified BS claims out in the internet space.

Some of the top 15 currency traders can't even make a positive return every year and these are the best of the best (audited accounts). The bottom 10 in the ranking actually loose money over 5 years and these are professionals. Refer to the attached files.

You are aiming to perform better than every one of them. What makes you think that you can perform better than them besides on hope and optimism? When you have a 5 year record which supports your claim then at least that is the basis. Making money consistently is very hard to do. You only have 4 months of trading. Are you so sure that some of your success is skills based and not just luck? Each trade is frankly a random distribution of events. If you can achieve success consistently over a long period then possibly skills outweigh luck in terms of probability. Until you have a long enough track record, you are counting your chickens prematurely.

I would also touch on a topic which is not discussed at all. Risk and return are tied together. If you are going after big gains you are in fact taking on more risk. What is absent from the conversation is drawdown. In evaluating returns, the performance metrics that professional investors look at is not just return but more importantly drawdown. This is the main reason why leverage is used sparingly because of its effect on drawdown. If you can achieve 30 % return with a drawdown of 15 % or less, every fund in the world will line up to engage your services. If you can deliver a smooth equity curve with limited drawdown, you can offer your signal services through copy trading. You don't need a large equity to live on trading. A good trading record can generate good income. There are many ways to skin a cat. Taking on outsized risk to grow equity is a sure way to terminate your trading ambition.

Hmm...
That's quite interesting mate.
Immediately I disagreed when I read your claim that I was exhibiting confirmation and recency bias but I decided to hold off on replying for a while because I wanted to think things over. It's also funny you said that because I just had to point out some confirmation bias to a mate of mine during the week (attempting to trade also). He was adamant that he wasn't, but he was, he really was He just refused to believe me and as a result, just made a mistake that he refuses to learn from (lost 75% of his account on one trade!).

I don't want to insult you by disagreeing but I would like to discuss this further because I cannot just take someone's word. I have to see the evidence myself. Can you give me an example of these? I understand what both mean, I'm just looking for the evidence.

Thank you very much for this reply mate. It's after evoking a lot of thought and investigation, especially when doing my homework in regards to the 2 files you added. I don't doubt that the list is legit BUT I still need to be proven wrong... and the only way for that to be done is for me to fall short of my targets. I am not disregarding people's input when they tell me that I'm overstretching when it comes to goals. I am totally listening! I just need the evidence to support your claims and then I will accept it. Thankfully my risk management should be able to hold off any catastrophic damage.

You raised another interesting point also. Luck...
You asked if some of my success was not just luck, as opposed to being skill.
I'm sure some of it was luck, but I don't think that luck has any more to do with my trading than it does with yours. We can all get lucky. Each and every single one of us.

The forex market opportunities are currently not rare... so in that sense, am I lucky? What about when the market goes through a period of not offering me the same amount of opportunities? In that sense am I unlucky? I don't look at it that way. It is my job to understand the market...not just how the market is now, but how it was before and how it will change next. It is my job to understand the cycles of currencies. That is, the increase and decrease of currencies/economies value. The movement of the value of a currency largely follows the same patterns. Chart patterns present themselves on the chart and then often the pattern is completed by the release of some sort of economic statement. Knowing what the direction that currency is going in is what I am trying to do. By knowing that and taking trades in that direction increase my probability of being right. That's all I can do...to put as much probability on my side as possible and then, wait to see if I was correct. Will I be right all the time? Nope. Will I be right most of the time? I hope so but I don't need to be. I can be wrong 40% of the time and still turn a profit if my risk/rewards are in such a way that I lose less when I lose than I win when I win... as you are already aware of.

Something that has been said to me often and something I agree with myself is that I can make all the claims and projections I want. But at the end of the day, it's a track record that solidifies such claims. Unfortunately time is not on my side as I am only 4 months into it. Does this mean I'm wrong? Of course not. But without that record then nobody is interested in what I have to say about my style.

All I can do it to keep on keeping on!.. Listening to people when they offer critique and for me to observe my results as objectively as I can.

Tell me this though, if you can.
That list of hedge funds performance that you gave me... or any top hedge fund for that matter. How many traders on average trade for these funds? Do they trade to their own strengths or do they trade how they are told to?

PS: I have also linked my trading account to myfxbook in order to get the actual stats of my account. Not what I perceive/remember them to be. I think this will help me a lot!
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Old Oct 7, 2017, 6:09pm   #25
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Originally Posted by Brumby View Post
..I would also touch on a topic which is not discussed at all. Risk and return are tied together. If you are going after big gains you are in fact taking on more risk. What is absent from the conversation is drawdown. In evaluating returns, the performance metrics that professional investors look at is not just return but more importantly drawdown. This is the main reason why leverage is used sparingly because of its effect on drawdown. If you can achieve 30 % return with a drawdown of 15 % or less, every fund in the world will line up to engage your services. If you can deliver a smooth equity curve with limited drawdown, you can offer your signal services through copy trading. You don't need a large equity to live on trading. A good trading record can generate good income. There are many ways to skin a cat. Taking on outsized risk to grow equity is a sure way to terminate your trading ambition.
Exactly, well put brumby, brilliant thanks
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Old Oct 7, 2017, 6:18pm   #26
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Originally Posted by Kaeso View Post
Exactly, well put brumby, brilliant thanks
We should prob limit our hijacking of Nowler's thread - but leverage isn't necessarily about overexposure or insane risk - it can be used to enter multiple working orders without actually having open interest exposure and preventing dead money in that respect. I use this method to imitate collocation.
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Old Oct 7, 2017, 7:14pm   #27
Joined Sep 2017
Nowler started this thread Note: If anyone wants to see my account closer, I am happy to supply the statistics that myfxbook compiles.

I just started using this and as I expected, my memory of my first few months was a little off.

At least from now on I can follow it closely...I can't believe this is free
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Last edited by Nowler; Oct 7, 2017 at 8:22pm.
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Old Oct 7, 2017, 10:30pm   #28
Joined Oct 2015
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Originally Posted by Nowler View Post
Note: If anyone wants to see my account closer, I am happy to supply the statistics that myfxbook compiles.

I just started using this and as I expected, my memory of my first few months was a little off.

At least from now on I can follow it closely...I can't believe this is free
yeah its a great free resource thanks ill have to get myself an account which can link up to it, im currently on spreadbet with city index and IG, which it wont link to.

i look forward to see you break that downward trendline one day
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Old Oct 7, 2017, 10:38pm   #29
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i look forward to see you break that downward trendline one day
A target for month 5 perhaps
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Old Oct 8, 2017, 4:17am   #30
Joined May 2012
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Originally Posted by Nowler View Post
PS: I have also linked my trading account to myfxbook in order to get the actual stats of my account. Not what I perceive/remember them to be. I think this will help me a lot!
Do you still want me to further comment on whether you have confirmation and recency bias? I would suspect your FX book stats is sufficient in addressing it.
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