It’s hard to think of September without wincing. I thought August was a bad month for trading, but this month was even more difficult, in terms of good opportunities. On a more positive note, I think I responded to the challenge correctly. I made few trades, but they were of high quality from a win-rate perspective. I traded 3 of the 4 weeks (I like to count my months on week boundaries, so I consider September to be the four weeks from 9/4 to 9/30), and only found 10 trades I wanted.
Even then, I was taking tighter and tighter profits, so I was making less money per trade than I was in August. Here are the stats:
| Total P/L: | 5.02 R |
|---|---|
| Trades Taken: | 10 |
| Winners: | 9 (90.0%) |
| Expectancy: | 0.5 R |
| Biggest Winner: | 1.6 R |
| Biggest Loser: | N/A (the trade that wasn’t a win was 0 R break-even) |
So, a 5R month. As a rule, I don’t maintain or try to work toward profit targets. I think that messes with my ability to make good decisions. But, to give you an idea of what it means, I can live a pretty austere existance on 4 to 5 of my-sized R’s a month. On the other hand, 8 to 10 R means I live comfortably, and possibly even put away some money.
So, 5R isn’t bad, but I spent more this month than I made. If there’s one thing I can’t do, it’s live austerely! :-) It’s not really a cause for concern, as long as that doesn’t continue. I’m always making improvements, and am generally ahead of schedule in improving my profitability (I had said in my StockTickr interview that it was my goal to consistently cover my living expenses by early 2007, and until this month I’ve already been doing that).
R Chart for September (click to enlarge):
Cumulative R Chart since returning to daytrading on July 12th (click to enlarge):
September 29th, 2006 at 1:03 pm
Richard, nice!! A lot of carefully chosen trades it looks like. I kinda threw a bunch of darts at the board to see if a couple would hit the bullseye… ;). For me for the month 7.2R, including commissions. 40 trades, largest winning day R 2.4, largest losing day R 1.85. I concentrated on cutting my losers quickly; however, I obviously didn’t let my winners run looking at my plays. 8 winning days, 4 losing days, 2 scratch days. I would have to look back to see my ratio winners to losers. Give me something to do this weekend. I do have a boatload of scratches. Have a great weekend everyone!!
September 29th, 2006 at 3:25 pm
Richard,
That chart is a thing of beauty. With such a strong positive expectation, why aren’t you risking more per trade?
September 29th, 2006 at 4:15 pm
@Zoomie: Not bad! Especially for September. Have you considered using stocktickr? It keeps track of all this stuff for me, and draws the graphs, etc. If you look at my daily prep video from last night, you can see I’m all about convenience! My computer does most of the work for me.
@Tyro: good question. One answer is, since I trade so little, I want more data before I start raising my per-trade risk. A second answer is, I would need more leverage, or more capital, than I have right now to risk much more on the trades. Maybe I should start a hedge fund… :-)