Anyway, as some of my previous (vented) posts in the month of May stated, I had a good losing month. The dax alone took me for over £5.2k. Dam these meerkats.
Managed to pull it back somewhat but still ended the month on minus £1.4k.
I am also expecting losses next month (June) as well and is expected in the region of around £1.5k. These are the best months to publish as it details just exactly what one needs to do when it comes to the classic saying 'Money Management'.
Money management is not just about managing your brokers account; it’s also a major part in how you deal with personal expenditure etc. How many people do you know could survive without being paid for 2 months in a row, worse still how many people do you know could survive not only no wages for 2 months but also having to still payout on living expenses PLUS paying into the markets just to add salt to the wound. In essence paying to go to work.
This in itself can have a major impact on how one trades moving forward:
Cautious trading means you miss out on those opportunities.
Over trading/aggressive behaviour means you frantically look for opportunities that simply do not exist.
In short, just do the job. You don't hear of city traders saying 'I've just had a bad trade, I'm going home to cry'. Rubbish, clear your head and get back on it. Do or die. Man up.
Someone recently joked about me coming to London and paying only a nominal fee for a room instead of something more grand, it did make me laugh but there is a serious point here. This is on the back of me taking £5k per month from the markets. Let’s look at how much £5k really is:
£5k per month is a total of (over 12 months) = £60,000 per annum. Not bad some will say. I say it is bad, very bad indeed in comparison to what I have to do and risk to achieve this.
Now take out a few months for drawdown’s of say £10k, that’s easily achievable and I’m probably being kind here, that leaves £50k, now take out the fact that we have to have an insurance policy in case that eventful black swan wipes us out. We need to build a pot from it so let’s take out, say, 20% of the yearly expected total – that’s £10k over the year; this now leaves £40k. What about a pension fund, take out another 10% and that’s another £5k off, this leaves in my pocket:
£35,000
Now what about compounding – interesting one as so many people harp on about it. How am I going to compound from this amount, well I do, but I do it by living a reasonably frugal existence, this means budget rooms when I’m out playing, there’s no tax relief here.
So if I compound just £5k per year, not a lot. That leaves me with a whole £30k per year or £2.5k per month. Half of what most people see I take from the markets each month. Oh in case we forgot, what’s a holiday or sick day? What about expenses and so on, are these all for free?
Now let’s look at what I do to win this money. All day and all night I am on it like a fly on the you know what. I live eat and breathe it. I am worse than an addict and even after all these years I still do not get bored with a single day. I truly have found my vocation in life. I am doing it for the enjoyment, not for the cash, this is secondary. I keep my eye on the trade and not on monetary figures, this is insignificant to me. It matters not how much a trade has just rewarded me or taken from me, what matters most is how much I pay myself at the end of each month, if I can at all.
So, when people band around making money from the markets with just 1 hour a day, make thousands per month blah blah blah, do it in 6 months yeah whateva, I hope you can now appreciate that with all the hours God sends, all the passion in the world and a healthy bank balance and plenty of experience........ It really is hard to make a living from trading the markets. If you don’t enjoy it or have the time and support for it from others, it makes it a million times worse.
Anyway, rambling on:
Results for this month (May)
Wins = 9 @ £3,884.37 average of £431.59
Losses = 10 @ £5,296.05 average of £529.60
Total trades = 19
Biggest win = £1,022.79
Biggest loss = £1,129.25
Win rate = 47.3%
Trade Ratio = 1:0.9 R/R
Monetary Ratio = 0.73
Net = £-1,411.68 (Minus)
Good luck for this month all. Screenshot for verification purposes but as normal a lot of data has been removed as levels are still in play. The one’s I have shown are now obsolete.
Actually, nothing needs to be taken out this month as all previous levels have now changed.
Word to self: I am only as good as my last trade. The next trade could be the series of events that blows the account.
Regards,
Lee Shepherd
