Losses just aren't that bad. Even long strings of them.

Discussion in 'Risk Management' started by jnbadger, Apr 12, 2022.

  1. jnbadger


    I run a strat which requires very tight risk management, which means my win rate is lower than what some would consider to be "professional" (It's <60%). But it has served me very well because one win can make up for 10 losses, and I can't remember the last time I had 10 losses in a row. But any loss can be very frustrating. Especially when you're new and you're trying to get into your flow. Multiple losses can make you question your abilities, your judgement, and ruin your confidence. More importantly instincts tend to take over after a string of losses and make you want to take profits as soon as you have them. Then you look back and a couple of those trades could have made you profitable for the day/week/month. This still happens to me once in a while, but I push through it and still follow my exit plan for winners.

    I live in a small town in western Wisconsin, and when I hear sirens, I sometime get curious and turn on the scanner radio on my phone. Turns out there was a head on collision about a mile from my house with multiple injuries about 20 minutes ago. PD, EMT and fire are on the scene, and a life link helo is on its way from the Twin Cities.

    My point? (helicopter just went over) What's the worst that's going to happen during a drawdown? Ok, so you get emotionally distraught. If you're new, it's natural. Just keep putting in the work. If you've been around awhile and you have a system in place which you know to be profitable and you still succumb to these emotions, all I can do is repeat what Lescor said a long time ago (one of the most profitable traders ever on this board). "Think like a pro and act like one".

    Again, what's the worst that's going to happen if you're up a little in a trade after a string of losses? You get stopped out again. Big deal. Man up and deal with it. You're not getting a phone call from the police telling you your loved ones are in a helicopter after a serious accident. It's just another loss.

    I'm in my 26th year, and I've simply just turned it into a mathematical game, and it's helped me so much.

    Good luck to all, and for God's sake, keep it in perspective. It's just a fucking game after all. We're just lucky enough to play it.
  2. easymon1


  3. SunTrader


    I've read often (don't claim to know either way) the win/loss rate for most "professionals" is below 50%.
    rb7 and murray t turtle like this.
  4. %%
    I would much rather have drawdowns than losses\but losses [ business expences] are part of any business............................................................................................
    Slightly off topic, but not much\ because picking shots helps in any game. Paul tudor Jones took out a full page ad in Ducks Unlimited MAGAzine / ''Take the drakes+ leave[dont shoot] the hens'':caution::caution:
    And 8% inflation is not much\Argentina has 57%/60% projected this year. Good post
  5. jnbadger


    Yeah, just go through some of his posts. We used to post daily in the old P/L threads with Dustin and many others. I still go through them sometimes. He never gives anything away, but what a wealth of knowledge.

    When we were both at Echotrade many years ago, I talked to the ops manager one day and I asked if she had ever talked to him. She said "Yes, I met him at the expo. And he is a very different person from you and I". I knew exactly what she meant because he was a firefighter before he became a trader.
    murray t turtle likes this.
  6. jnbadger


    Thank you sir. I never saw that ad, but I remember reading about it. PTJ, another ballsy dude.
    murray t turtle likes this.
  7. jnbadger


    Yeah, I think I saw a youtube video from some ex Goldman trader who is selling seminars where he said that if you are above 60%, you're in the professional range. I could easily get to 80%. But if I did that, I wouldn't make any money. The profits would just be too small. I'd love to be at 80% and make 5R on all of my winners. But that just ain't gonna happen.
  8. newwurldmn


    anyone who makes a claim like that is a bozo wannabe piker.
    rb7 likes this.
  9. Buy1Sell2


    Cut losses short and let winners run to maturity----pretty simple stuff. Most don't, or can't, get it
    murray t turtle and jnbadger like this.
  10. jnbadger


    I often wondered why he is still so young and not working at Goldman anymore. (Probably 40ish). And if he made so much money, why is he doing seminars? I remember googling his name, but couldn't find anything on him.
    #10     Apr 12, 2022