Monday, 30 September 2013

September: The Results

It's been a real slog since the start of the US Open. After my horrible downswing during the first week of Flushing Meadows (where I made a lot of mistakes), I found myself in a rut of bad variance. For a good three weeks, opportunities dried up and when they did arrive, they more often than not, didn't work out. So another slightly disappointing month in comparison with how I did over the beginning of summer but I'm still pleased as this was a tough month.

Any month with profit is pleasing to me. But I think it's something many traders find difficult to grasp - that not every month will be the same. The general theme I find (and I'm seeing it with some academy members), is that aspiring traders expect that the pros all make similar amounts of profit every month and it never deviates much. Consistency doesn't necessarily mean consistent over a 30 day spell and it certainly doesn't mean consistent over a weekly or daily period. In my case, I have been quite fortunate in that I've found a way to trade that is fairly consistent over a relatively short time period but that isn't intentional - it's just the way it's panned out. My only aim each month is to protect the bank and execute the strategy properly, not to make a certain amount.

My months tend to pan out quite similarly, possibly because I trade a lot of games (I average around 125 markets per month). What most people won't realise, is that within that month, I will have ups and downs. It's never a straight profit line on the graph from start to finish. I will usually have at least one week where I don't make any money at all - even be in the red. This month was unusually tough, in that I went about 3 weeks where I was basically breaking even. Only in the final week did variance swing positively for me. My aim during a difficult week, is always to break even. My records show that when I have a tough week where the wins aren't coming, I will usually end up around break-even point - as long as I hold it together mentally and don't start chasing. But that doesn't mean I don't have losing streaks of matches. Those streaks are the true test of any trader and I've already seen academy members who are close to giving up at the first sign of a downturn.

Unfortunately, downswings are part and parcel of any pro trader's life. There will not be a single pro who doesn't go through downswings and if they don't, it's because they've found a holy golden egg laying grail! In fact, I consider myself lucky in that I have not had a losing month in a long time because I know many pros do have them and I've heard that some even go a whole YEAR without making profit. But the key is, they know in the long run that the system they have works and will eventually produce an upswing which cancels out any losses. My biggest downswings don't tend to last longer than a week and I'll usually have a big upswing not long after because I am confident in what I'm doing, have got my numbers worked out and stick at it. It doesn't make a downswing any less frustrating though! I can fully understand why anyone who didn't have my experience or faith in my way of trading, would feel like giving up during a bad spell of variance but trading is TOUGH. I think too many people think it's easy and that's why when they are faced with the reality, they change strategy for something they think will be easier. It's a classic newbie error, one I made countless times.

So yes, I'm proud of how far I've come and grateful that I seem to always have profitable months - for now. But if people knew what I had to cope with DURING each month, I reckon they would think very differently about just what it takes to achieve that green figure on such a consistent basis. I certainly don't plan to make a certain amount or even expect a certain amount each month. I just deal with it one trade at a time and at the end of the month, if I'm out on top, it's a bonus. If one month I end up in the red, so be it. As long as it's not a massive loss, I'm fine with it because in the long run, I will have enough saved from winning months to cover it and I will expect a spell of good variance is not far around the corner. If it isn't, then I know it's time to start worrying and perhaps look to change something. Till then, I'll enjoy P&Ls such as this, as they are far more than I ever achieved in a "normal" job.

Monica Puig:




(If you are wondering about the football results, I am not actually trading soccer this season. The losses incurred on Betfair are a result of some arbing I've been doing with the premium charge in mind, so no actual losses overall)




3 comments:

  1. Good post as always... I think it is an error lots of us starting out make, focusing and evaluating on a very short term basis. It is also difficult to trust a system that hasn't still passed the test of time, as much as you see the logic behind it and it seems to work.

    Anyway, what I can't find an explanation to is how you put Puig there after what she's done today, I see she fucked both of us (non literally). What you really deserve are those -5.41... you don't get to go against Petko!

    Could you elaborate a bit more on those arbs? Or maybe I have lost something regarding the premium charge... because I find it difficult too to lose money on one side without losing much on the oher (it is sad we even have to think about these things, but whatever).

    Cheers!

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  2. Haha, yes I just realised about Puig! Doesn't really deserve a place on my blog!

    Actually, I didn't go against Petko............she messed me up too!

    Not much to say about the arbs really. I'm just trying to lose on Betfair - doesn't matter if I make profit from the arb or not, a small overall loss is fine for what I'm trying to do.

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  3. No... I wasn't talking about making a profit from the arb but about what you say: transferring money to a different bookie/exchange.

    I tried it once and it wasn't as simple as it might appear at first glance. If you don't lose much you won't have value long term on the other site to get the bets win there, therefore transferring the money out of Betfair into that site.

    I may be missing something, but I tried it, I researched, and all arbers had the same answer: there's no way long term. That's why they focus on getting new accounts and not this kind of stuff. But again, I may be missing something if it's working for you.

    Cheers!

    ReplyDelete

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