I Hate Myself

Discussions about personal psychology for the individual trader.
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Toby
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I Hate Myself

Post by Toby » Thu May 01, 2003 12:28 pm

:x I hate myself bcos I just can't exactly followed my plan :x
I back-tested my method, theoretically it make money but when to the real trading...my got damn f**king results!!!
Doesn't know why I sometimes will take the opposite signals....Got mad about myself!!!

Aaaaaaaaaaaarrrrrrrrrrrrrrrrrrrr!!!!!!!!!
Somebody please help!!!!!!

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Post by Kiwi » Thu May 01, 2003 1:23 pm

I am assuming that your system is clear and easy to follow.

To understand why you take the signals I'd suggest Mark Douglas as a must read; follow his principles from the Disciplined Trader. If it relates to deeper issues then maybe Van Tharp's course (I havent done it) to try to sort it out.

You may be able to fix it by simply applying an NLP Model called "Never Repeating Mistakes" which can be found in The Emprint Method" by Cameron-Bandler, Gordon and Lebeau - probably through your library. If you don't have a major psych issue then this could be sufficient. I found it good for a niggling problem I had wanting to get a slightly better entry than my system was giving me.

Even though it works immediately you should repeat it every day for a couple of weeks and then once a month for the rest of the year.

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Post by Sir G » Thu May 01, 2003 1:37 pm

Hi Toby-
I hate myself bcos I just can't exactly followed my plan
I back-tested my method, theoretically it make money but when to the real trading...my got damn f**king results!!!
Doesn't know why I sometimes will take the opposite signals....Got mad about myself!!!
Do you know that sometimes in life, the easiest way to find the answer is to rotate the question a bit?

I think the two separate issues that you have settled on are:
  • I just can't exactly followed my plan
  • I hate myself bcos I just can't exactly followed my plan
Maybe a healthier way for you to view it is:
  • I am following my plan perfectly
  • and I hate myself because I am following THAT plan perfectly
I think your True plan is being followed perfectly. While you are not following your perceived plan and that upsets you.

From my best guess, we all have two compasses that we employ to navigate us. The first one and the weakest one, is why we think we are doing things. The second one and this is the strong one, is the reason why we do things.

If a reoccurring pattern can be seen and in your post it reads that this happens often, make note of it because you are succeeding in your plans.

Have you ever met someone who is always down on their luck and have nothing to show for themselves? They probably complain a bunch...Learn from these people, they are perhaps the most successful folks you will ever meet in the way of being disciplined in getting what they want. They make decisions day after day which keeps them and their spirits down.

Toby take a good hard look at what you fear might happen if you followed the perceived plan. What comfort does hating yourself bring you or those around you? There are a million different questions, and an honest look will lead you to the answers. I bet you already have felt the answer inside yourself. Respect the answer and let it out.

Life goes on and it moves in cycles, which means tomorrow or next year will be nothing like today. Any pain you feel today will be an nothing more then an inconsequential memory in the years to come. Basically, it has no value other then giving you the opportunity to look at what it's all about. Embrace it and learn from it.

We are either rewarded or punished for our behavior, if something keeps happening and you make no changes to "fix" it, then some part of you is content and happy with the result.

Toby, Please respond.

Gordon

Toby
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Post by Toby » Thu May 01, 2003 1:55 pm

Today I am down and confused. I have nothing to say and I don't know what to say.

Lack of discipline and poor money management lead to my poor trading results. Past I spend too much time to develop my system, now I should find a way to not double guess my system, learn to be discipline and apply good money management.

Anyway, thanks kiwi and Gordon!

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re: I Hate Myself

Post by Howard Brazzil » Thu May 01, 2003 5:20 pm

Hi Toby,

I think we've all experienced the same level of frustration at one time or another, so don't sit
around and beat yourself up over it! But do take the time to absorb and seriously contemplate
what Sir G and Kiwi were kind enough to offer; namely, good advice and good food for thought.

It's possible we've all become a bit callous about the psychological element of trading because
it's received so much attention over the recent past. But there's a reason for that: It is a
hugely important aspect of successful trading (and of life, for that matter), because it drives
every decision we make, and everything we do.

A lot of folks recognize at a high level that trading with a system will help them remove emotion
from the trading equation, and it is broadly agreed that this is a good thing. But the question of
why you failed to follow your system is the simple result of a more complex chain. Psychological
factors creep in at every stage of the investing process, and played a strong role over your
decision to trade systematically, rather than with discretion. Ditto for the decision of whether
to write a system, or buy one. And psychological biases creep into the system design stage, as
well, if that is the route you chose to go. See Van Tharp's Trade Your Way to Financial Freedom
for a good overview; his home study course, as Kiwi mentioned, covers this in detail, and is well
worth the time and expense. But be forewarned: It is not a weekend read. It takes a lot of time
and effort, and a lot of self-examination to properly work through. (How you approach his course
is a good gauge of the level of your commitment to becoming a successful trader, so it is particularly
valuable in this regard.)

Biases are insidious by definition: "A particular tendency or inclination, esp. one which prevents
unprejudiced consideration of a question." (Amer College Dict.) It takes some digging to flush them
out and acknowledge their influence on our behavior.

****

So the inability to take signals isn't a disease in itself. It is a more a symptom of underlying
difficulty elsewhere. In essence, it is very likely that your system contradicts one or more beliefs
you hold about the way markets work, and if you don't know what those beliefs are, then you should
probably dedicate some time to sitting down and sorting through them. And as Sir G pointed out, if
your intentions are not backed by a true desire for success, then the markets will willingly
accommodate you in this regard.

Another critical aspect of the psychological component is understanding your tolerance for risk,
which is a function of age, goals, and the amount of stress in your life (there are other factors),
and which could easily be a factor in the difficulty you describe (taking the signals your system
gives).

The level of dedication and commitment of successful traders is often under-appreciated. I have
read that some traders, before bringing a new system on line, will step through their system
day-by-market-day, over years of data, looking at the equity, and experiencing what it feels like
to pull the trigger under a variety of market conditions, trade after trade after trade.

The path of the journey to the level of confidence and discipline needed to consistently trade in
a systematic manner is different for each of us, and at the end of the day, it is just that – a journey.
Finish every day and be done with it. You have done what you could;
some blunders and absurdities crept in; forget them as soon as you can.
Tomorrow is a new day; you shall begin it serenely and with too high a
spirit to be encumbered with your old nonsense.


- RALPH WALDO EMERSON
- Howard
Last edited by Howard Brazzil on Mon May 05, 2003 12:43 pm, edited 1 time in total.

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Post by Dutchtrader » Thu May 01, 2003 6:04 pm

Toby,

1. It's good that you feel responsible for your results, that's ok!! :lol:
2. If possible go back to the minimal position size. Just execute your signals.....
3. Or stop trading for some weeks, reading Mark Douglas, trading in the zone, get rid of the negative feelings and go back to point 2, be a turtle, don't hurry

This was my humble opinion, I hope more visitors react with their vision.

Hope that helps,

Marc

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Post by chuckm_ca » Fri May 02, 2003 10:31 am

I've been there, and you are at the point where I totally turned my trading around. I'd second guess signals and then watch the profitable trades run which I didn't take of course and for some uncanny reason I always managed to take the losing trades. At this point I realized that the most painful event for me was to watch a trade go profitable in a big way without me on board. It is far more painful than getting whipped over a period of months because 1 good trade can make all those months back. The ego wants to be right all the time but that is not possible in trading. It also doesn't help that in school we learn that above 80% is very smart and below 50% is failure. I only wish I could be right 50% of the time but in reality its around 45%. You have a system that works, set a goal to take every trade. At the end of each day, ask yourself if you followed all your rules, if yes, then you had a good day no matter what your P/L shows. What happens as you follow your rules? You gain confidence in them and start to become profitable. Ultimately you are rewarded for good behaviour. As time goes by it becomes easier and easier to follow the rules and then you will get to the point where it becomes extremely uncomfortable to break them, so you don't.

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Post by Sir G » Fri May 02, 2003 10:40 am

Hi Chuckm_ca
for some uncanny reason I always managed to take the losing trades.
That is an interesting point. How is it that ones mind can be so focused that it can select the losing trades? Does that mean that our mind's eye can also see the profitable trades coming?
At the end of each day, ask yourself if you followed all your rules, if yes, then you had a good day no matter what your P/L shows.
That has always been my definition of a winning day vs. a losing day. It's based upon my performance and not the equity.

Gordon

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Post by chuckm_ca » Fri May 02, 2003 3:58 pm

Quote:

"That is an interesting point. How is it that ones mind can be so focused that it can select the losing trades? Does that mean that our mind's eye can also see the profitable trades coming?"


Yes Sir G, I do believe the minds eye can also see the profitable trades coming. There are days when I'm so in tune with the markets I seem to know exactly what it is going to do next. Then on other days, I seem to be totally out of sync with the markets. I'm still trying to figure out how to use this and how to get into this "zone" where I have a very good feel for what is going on. Being calm and totally detached is the most important aspect I think, as well as being well rested, but I'm not sure. I've noticed that when I'm lacking in sleep, my judgement is not good and my thought process is slower and I tend to be wrong in my assessments. Thankfully I've learned to trade a mechanical system and never over ride the trades, but there are times when I know the position is going to be a loser.

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Post by Mark_et_Lizard » Fri May 02, 2003 9:51 pm

Toby

If you’re interested in the mechanics of order entry then become a broker and get paid for every trade. If you want to be a trader but second guess the signals at time of entry then have some one else trade it. It costs about 10 dollars more than doing it yourself, add this to your cost and deduct a reasonable amount for slippage. If your system makes money in out of sample paper trading then it should work. Sleep late, see a movie, go out, avoid news or market reports, at the end of the day check if your system traded, check if you were filled properly, and that’s that. If the system makes money and is executed properly you’ll make money. Trading is researching/creating the system, deciding what to risk, taking the risk, it does not have to be watching the screen all day, waiting for signals, placing orders.

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Post by edward kim » Sat May 03, 2003 3:35 am

Hi Toby,

There is also the possibility that a much larger issue might be at work here.

Suppose you did follow your system, and it worked beautifully? Then what? You would go to trading full-time .. what if that means that you quit your regular job, go full-time trading, and then you go bust with nowhere to go?

Suppose everything works really well and you decided to set up your own hedge fund to trade clients money. Does the responsibility of managing millions of Malaysian Ringgit, clients, hard work, long hours, pressure during long drawdowns bring a fear and giddiness inside of you?

Lots of people have a fear of failure, so they "do" things at a smaller level to prevent themselves from ruining themselves at a huge level. By doing this, they never get to the next level.

You have a lot of talented people here to support you all the way, so you might want to reevaluate how you really feel about success. Once you are over that hurdle, things flow very easily .. like a good trend-following system :wink:

I am not a psychiatrist, but I hope the additional perspective helps you out~

Edward

Toby
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Post by Toby » Sun May 04, 2003 12:02 pm

Thank you to everyone here! Thank you for all the advices!

I am using a trading log now.
Although I am still down in the Friday trading but I feel better bcos I am able to execute the trades exactly as my system signaled. Losing is only part of the game and I know and believe my system is working (at least in the back-testing, it shows a positive result).

Thanks again!! :o :o

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Post by d-b » Mon May 05, 2003 9:42 am

I’ve read some serious wisdom in this thread.

For my part, I used a literal time divide to separate the trading and development disciplines. Trading the US futures markets in London allowed me to spend the morning analysing the previous day’s price action and placing my trades and the afternoon trying to improve aspects of my system – very civilised!

Seriously, in the morning I had my trader’s hat on and I knew my job was simply to carry out the system rules. As chuckm_ca says, the extent to which my day was successful was purely the extent to which I had followed the system.

In the afternoon, my hat changed to that of the system developer when I could indulge my need to hypothesize and tinker with the system to my heart’s content. I knew I needed this outlet and that unless I had allowed for it, manifestations of this need would spill over into my trading.

Perhaps it would help you to try to specifically allocate time for your trading and time for your other needs. You could even write a job description and manage to it for each discipline if you are that way inclined. This probably wouldn’t be necessary for very long but might get things into focus in the short term.

I hope this helps a bit.

Keep up the good work chaps.

David.

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Post by p8 » Fri May 30, 2003 8:04 pm

I am sure we all have read that in some ways, trading is similar to sports. For example with tennis, squash, golf, or whatever sports or game we choose to play and master, we need to spend an infinite amount of court time to practice and practice... and practice. There is no way around it. Same with trading.

As to this problem of not following a system or plan... well, there are many good books, theories, and other expert explanations for that. And, many have written eloquently on the subject in this thread. I would like to offer another way of looking at. It is maybe as simple as this fact: our lack of experience.

Just like our proverbial beginner tennis player, when we just started we didn't always strike the ball they way the coach told us to do. For whatever reasons we just couldn't. We wanted to, but these darn arm and elbow and wrist just doing their own thing. Thus, we spent more time picking up balls inside and outside the court than driving it to the otherside of the net. But, like they say, practice makes perfect (IF you LOVE the game. Big IF. Do yourself a favor and stop playing if you don't love it and find something else you love). Practice, practice, practice. The biggest difference in trading is we have to make sure that we don't blow our trading account up while "practicing."

My first year trading full time was a stressfull endavor. A year full of drama. Grand victories and humiliating defeats took turn to the stage. When I realized that all I needed to do was to accept my lack of experience and to just "practice" consistenly, it was a huge relief. The drama disappeared. I all I have to do is "practice." No winning or losing. Just practicing. Trading in the morning (and yes still making all kinds of mistakes every now and then). Studying the trades, the market, and my system in the afternoon. Journaling it at the end of the day. And, doing the same routine the next day. And, the day after. Over and over again, until who knows when.

My 2 cents.


-p8

Jester

Post by Jester » Thu Jun 26, 2003 11:06 pm

My 2 cents -
I agree with eck.
Search your feelings and use the force.
Let the force flow through you, don't fight it.

Jester the Jedi
:P

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Post by William » Tue Nov 15, 2005 9:30 pm

I know this is an old thread, but the advice on this stuff was great. Dealing with trading a system is my challenge now and the advice here certainly helped...I hope new readers read this thread, its very helpful, if you are experiencing these problems.

Toby, if you are still lurking, how are things coming?

Although i am still struggling to find consistency in application of a system some things i have done that put me back on track may be of some help to the next guy/gal.

1. Walking through your system, tick by tick, trade by trade has helped me. Living/breathing the system i found was beneficial because price patterns repeat, you get used to what it looks like right before a signal and if your system works, you see that over time, drawdowns get washed away. Lastly, any inconsistencies in your "system" get exposed very quickly. While this doesnt replace real live trading and the emotions of a PnL at risk, its as close as you can get.

2. Taking the practice mentality as mentioned above. Every day take a step closer to trading it 100%. I think a journey perspective does relieve some stress and annoyance but frustration still comes in big time. Doing it once is better than never, twice better than once..etc. Its better to trade it small than not at all. I have noticed that once you do it, the hurdle becomes a lot LOWER the next time round and it only takes a few times in a row, to become more habitual. Every day i challenge myself to do it a little better, instead of yelling at myself for all my screw ups (well thats the way it starts out in the AM :oops: :lol: )

3. Visualizing myself take trades, feel the apprehension, feel the doubt, feel the fear etc, but completing the trades as warranted by the system helped create some inertia. Seeing the trades and FEELING the feelings that go along with trading. I notice less action blocks and less tension. However, i think doing this everyday helps keep you in tune, its not a one day fix...Also seeing things not work out in the near-term but workout in the long-term helps. This is where a real desire to be proficient gets tested because its a bit of an effort to get into that "mental space"

4. c.f. mentioned that not trading the system was a bigger risk. I try to get into that mentality and if you TRULY believe that your system is better than shooting from the hip, is in line with the way you see the market and is profitable...then its true, deviating from it is a bigger risk.

5. Knowing that this thread exists and that others struggle with this, BUT do overcome it, helps.

6. The times that i follow the system and it works out over a course of a few weeks, the peace of mind and confidence in myself to trade consistently profitable is worth the uphill climb.

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Post by gus616 » Thu May 25, 2006 1:59 am

I have currently been day trading sine March 2006, in my practice trades I have been right 87% of the time, in my actual trades I have been right only 49% of the time. I am having trouble execuitng my trading plan consistently. I have back tested it thourghly with a 70% success rate on every stock I have tried, I know it works, I just have to execute it on all vaiable trades, I can't be cherry picking.

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Post by gunter » Mon May 29, 2006 7:56 am

Hi gus616

I started trading recently and was lucky enough to be long in a rising market. As the market progressed in my favour I was constantly bothered by the fact that my initial position size had remained the same.

After a while, I decided to increase my position size (due to greed and not the system). Although the market went even further in my direction initially, a subsequent reversal caused quite a big loss to my equity. Once the pain of losing money got to its extreme, I exited the market at the exact bottom. The next day the market started rising again and I lost a substantial portion of my winnings on that second trade. :(

I then calculated my "cost of greed" and added this to my current portfolio value to determine where my equity should have been. Seeing my "cost of greed" on a daily basis constantly served as a reminder that I would have been better off just following the system.

It should be noted, however, that the "cost of greed" tends to increase as time passes. Had I not initiated the second trade, I could have had a bigger position size on my next trade. This represents a lost opportunity to compound as each increase in position size would theoretically arrive sooner.

Perhaps you should consider calculating what your profits would have been and then calculate your "cost of fear". Perhaps it could help you in initiating your trades according to your system.

On another note, my portfolio value is fairly small when compared to my earning potential. If my account were to blow out, I could replace the funds in approximately 3 months time. Therefore I do not fear the losses that might come (although my first big drawdown taught a lot of respect for those losses).

Perhaps you should consider initiating your trades risking a smaller amount of capital on each trade until execution is no longer a problem. Most market wizards trade bigger positions when they are confident in their abilities and smaller positions when they are not.

Also, you might want to read Sir G's last post on this thread. Most market wizards state that when they follow the system, it does not matter whether they win or lose.

Good luck in your trading!

Gunter

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Post by ecritt » Mon May 29, 2006 1:25 pm

Nobody enters the speculative trading world armed with backtested results that lose money. Yet most traders fail in the long run. One must have an edge (most people do not). One must have effective money management (very few do). One must have the discipline to execute (only a tiny minority can). One must also be sufficiently capitalized, have solutions to handle operations, I.T., legal, infrastrucure, etc. Only a very unusual individual will be a good fit. Desire is not enough. There is no shame if one is not naturally "wired" to be a good speculator. I desperately wanted to play football in my younger years. I broke both legs, three fingers, my wrist and my nose. Obviously it wasn't for me. Desire couldn't improve bone density.

My experience is that discipline in trading can be taught early on. But, if after a couple of years one is still struggling with it, the problem is not likely to be correctable. The truth is that some problems don't have solutions. The opportunity cost of "not moving on" can profoundly impact one's life.

If one hates one's self...well?

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Post by BARLI » Mon May 29, 2006 5:44 pm

guys, I've found it helpful to look at biggest Loss that your system produced and fade it in similar situation, you can easily define such situations once you know what your system was created to "catch" and when it fails to do so, then you know it's going against you, so there's no reason holding till the opposite signal is alerted...anyone had same experience?

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