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Wednesday, January 03, 2007

Wednesday's Results

Picture a kid in the swimming pool flailing around. The kid is treading water, but not really going in any direction.

Read Full Post.....
That pretty much sums up my day.
I actually wrote out a trading plan for trading the Russell 2K Futures. But I did not stick to that plan. I got chopped up taking low probability trades this morning. If it weren't for the selloff due to the FOMC, I would be in the red for the day.

I think I have gotten most of that futures trading fever out of my system. I can say that because now I am actually not just thinking, but planning to paper trade ER2 using the Bracket Trader. I found about about Bracket Trader from Boogster, a trader who's been trading the index futures for about a year now.
If I knew about Bracket Trader, then why didn't I start using it sooner, instead of now? Because I was thinking exactly like a noobie - my first few ER2 trades were winners, and that got me overconfident in thinking that I didn't need no stinkin' practice with paper trading.
But Trading for a Living is all about performance, similar to choosing to be a professional NHL player as your vocation. I first read about this way of thinking about trading when I first found out about one of Dr. Brett Steenbarger's two blogs (I linked to the other one in my blogroll). While I don't agree with every article that he writes (like this one about the 3 myths of trading), I cannot escape his more than valid point about trading being a performance activity.

Trading is the ultimate performance activity. You get paid to perform - and punished for underperformance - that is the bottom line. And so with any performance activity, you need to practice, and constantly hone your skills. That means paper trading.
I plan to start using paper trading via Bracket Trader quite a bit to practice and improve upon my ER2 trading.

4 comments:

Tyro said...

Good luck studying ER2. It's a wild ride and I'm sure it'll take some getting used to. But you have a pretty diverse range of trading styles already so it's just a matter of time before you add this one to your repertoire.


If you're looking for replacement trading UIs, you might also look at Button Trader. It isn't as intuitive initially, but after watching the videos I found that it was a lot easier to use, and seemed more reliable. I've tried BracketTrader a bit but found it got confused and I had two cases where TWS showed I was long but BracketTrader showed I was short! Another time, I clicked a button to close my positions, but instead of closing my long, it doubled me up. I clicked to close again, and I got doubled up again. It was running against the simulator TWS so I wasn't out real money, but those incidents scared me pretty badly, I can tell you.

If you do use Bracket Trader, make sure that it uses broker-stored stoplosses so you're protected in the event of a network outage.

luck!

Phileo said...

Hi Tyro,

Thanks and thanks for the link to ButtonTrader. It looks a little bit like the visual display of bid/ask in Bracket Trader - how is it better than Bracket Trader ?

I'll probably be using Bracket Trader in sim mode for the next little while until I am comfortable with its interface.

Tyro said...

Phileo,

I haven't used Button Trader enough. The beeps every time a new daily high was reached, and the confused trade (BT thought I was short, TWS said I was long) cooled my enthusiasm.

I'll post something about Bracket Trader soon. Why don't you let us know what you think about Button Trader, and we'll compare notes?

Phileo said...

Hi Tyro,

Ok, I will download Button Trader and start playing around with it. Once I am familiar with its features, I will post some sort of a blurb about it.