Tuesday, March 8, 2016

Frustrations and the Process of A High Risk Trader

Do you ever have moments when you get depressed over a loss? How about losing your cool over your stuck that's been consolidating while the rest of the basura sector is flying? How about not being able to ride that one stock you've already planned because things just didn't turn out the way you wanted it to?

I believe every trader experience these things. And yes that includes me. It's not like you're some kind of cold blooded robot that goes into the trading process with sets of algos and "if-else" executions.

Emotions will always be there.



Remember that time in biology class when you learned about a frog's anatomy? Trading is somewhat like that. You study everything and memorize the difficult terms, then you pass the written exam with flying colors. "Easy Peasy" You say. Then come the practicals. 

You wait for rain and nightfall for that perfect moment to catch these horny little things as they cry out in the darkness for them to get laid. The first few frogs you get ain't a good find; So you go on and on until you finally get your slimed hands on the perfect one. "At last! This better be worth it."

You feed the creature, hoping it survives until D-Day. Poor little thing, you've already deprived it in a lot of ways imaginable - have you no heart? It didn't even have the chance to pro-create and leave offspring. Human, what have you done? You start to develop a weird relationship with the thing.

Then D-Day arrives.

Opening a live frog in front of your teacher and telling her all you know about the poor little thing. It doesn't go well as how you imagined it in your mind. Yes you've aced the exams and all, but going through the process of catching it, keeping it alive, opening it up and eventually killing it stirs up something in you.

"It had to be done."

At this moment you realize the difference of knowing versus actually doing it. You understand that there is a process for things and it might not always be rosy or how you want it.


When I lose in a trade or miss an opportunity and get bummed by it, I always remind myself of my trading rules and the basics of my trading system. "Did I do the right thing?"

If you did, then there shouldn't be a problem. It's always about sticking to the truths you've found and believe. And what is truth you ask? Well, the simple reality of the truth in the markets is this:

If it gives you consistent profits, then that is truth.

When lolo Livermore, said "it wasn't in the thinking but in the sitting" , I believe he meant that you should sit on a position until the trend starts to go against you, and not overthink about things. 

It's just sad when people twist these truths to fit their beliefs. Like you know... "Don't think and Bodega lang."

For those who don't know who Lolo Livermore is, the guy is considered a rockstar in the markets and in the field of speculation. In his later years, he had a divorce, went bankrupt and died a horrible death by suicide. Yep - Not a person you'd like to follow.


I wasn't able to ride DAVIN successfully on it's latest monster rally. When I mean successful, I mean with volume. (I did get to do tsupitas on it's way up.) Unless you're still learning a trade setup, what's the point of gaining 10-100% or even more on a position if it's a measly 5-10% of your portfolio? That's just me though. 

I'm frustrated because It was a textbook play in the system - an easy trade. But at the same time not frustrated as much, since I've already gained a lot from the stock twice for this quarter. It's just that these things happen and it evokes certain emotions. We just have to accept that we can't ride 'em all.

One reason why I wasn't able to ride DAVIN with volume was because of a current position I had - one which I decided to be my conviction play for the next quarter. It's not easy to hold and wait for an AOTS transition you know, especially when you're a seasoned basurero and see lots of basuras flying around. I could have sold it for a faster horse and other quick plays that showed up but that would mean breaking my rules. 

But by the end of the day, sticking to one's rules and having consistency is always better than sheer luck.


  1. can relate... I had Cybr in my port for a week and frustrated its not moving... sold all positions yesterday and bought Davin. Why because I had a small fund in Davin that kept on going up.. alas I bought at the top. Expensive lesson because Cybr moved today. I was once again lost to my emotions.

  2. Exactly the point Zee. You nailed it dude. :D

  3. Enlightened at it's best! It's always been different if you have a position on a stock. Only if I noticed that the stock which I don't have is in GAIN section then regrets draws out.
    -just a new fan came from a deadly TrAP.

  4. I agree, I hold FNI for a week boom it made ZS srike. Cybr also made ZS strike as well. Thanks Zee

  5. That's the discipline I want to have. Congratulations on the 2 consecutive rallies of your conviction trade!

  6. happened to me several times...sold a lot of good stocks just to chase these flying basuras just to get burned at the top...you continue to provide good reads zee, keep it up

  7. Nice post Zee! What about the feeling of "Selling early" then the stock rallied!

  8. Just happened to me this week with MAXS. Got it @ 14 pero nainggit sa lumilipad na stocks. Eventhough my chart and my primitive trading plan says uptrend pa sya, I got out in search of the quick wins. Instead of the ~10% gains na meron ako, ended up losing by 5%. Still banging my head against wall - BalatSibuyas

  9. And here I am wondering what happened to the frog. Lol

  10. "over you stuck" nice pun there zee^^

  11. had the same issue a third telco play and a mega subway play. buti nalng may system. thank you po