iBankCoin
18 years in Wall Street, left after finding out it was all horseshit. Founder/ Master and Commander: iBankCoin, finance news and commentary from the future.
Joined Nov 10, 2007
20,318 Blog Posts

Got Caught Leaning Long — Markets in Turmoil Again

This action isn’t up my alley — too orderly for my taste. We just moved up 20%, so naturally a small dip is in order. But is this it — or is there more? These types of questions cannot be answered on a Friday and if I’m not careful — I’ll end up leaning one way for too long and get absolutely raped.

It’s likely the path of most pain is nowhere. Most are looking for wide swings. What if we trade small and range bound after this?

I had some position from yesterday and two failed day trades today, all closed out. The results.

(TXT -3.5%)
(GTLS -7%)
(SYF -9.2%)
(AAP -2.7%)
(TPC -5.8%)
AVB +2.6%
(MITT -5.2%)
(NRZ -5.2%)

In all, those losses amount to about 185bps for me, since my trades are typically 5% of my portfolio a piece. When I get a 50% winner, like I did yesterday ( I had two of them), those aren’t life changing for me either — maybe 2.5% for my overall portfolio a piece. The point here and the reason why I am telling you this is because I KNOW YOU AREN’T ADHERING TO POSITIONS SIZES and figure on making it big on just a few trades. How can you ever get good without practice? You need at least 10,000 hours of fucking up before excellence. Trade small and try to up your winning percentage. Only on rare occasions will I average down. I actually did so today and am up 12% from my second basis.

I’m not special and neither are you. Just because I crushed the market the past 3 months doesn’t mean everything I touch turns to profit. I am bound by the laws of mathematics and eventually I too will have a losing streak. The way I stay in the game is by humbling myself, taking losses quickly and not letting past successes get into my head — thinking I’m impervious to loss.

I’m not, and neither are you. If anything, you fuckers ought to just go to cash and wait for warmer climes.

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6 comments

  1. alty

    I prefer 0.1% position sizes on short term trades. That way it feels like I’m doing something when in reality I’m not causing long term harm to my portfolio.

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  2. itsgold

    this is a cruel market

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  3. awanka

    Whoah. Nice head fake.

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  4. narcist

    Tsk-tsk.

    That bear market rally, from which was at least easy to profit, was rather low IQ.

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  5. purdy

    I figure there’s at least a couple weeks until the effects of the calamity that is coming gets us to the point where cowardly officials will request enough actions and precautions be taken by people …that one will be able anticipate “the slope” flattening. The number of infected are many times what our govt and media are telling us. And only when emergency rooms get jammed do we ask a particular locale to take the measures needed to slow the spread. There are many more such locales coming.

    China required a mask to go out of your house in Wuhan. Machine gun wielding Italian police requested that people not mingle outside in northern Italy. Compliant Koreans are wearing masks. And all of the above folks are generally more aware than Americans that the virus lives on surfaces for a long time …and so those surfaces are being washed on an industrial scale.

    We on the other hand have major cities that are locked down because we didn’t do the above. Yet we still don’t require masks to go out (we demand just the opposite) …we merely have suggestion that you not party with more than 10 others …dot dot dot. Market will likely not find a bottom until we take the measures needed for smarter money to anticipate light at the end of this disruption.

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  6. tjnyt

    Priceless advice Doc. I will join Exodus if I have a good next week, I am prepared.

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