Live Trading System: hosted by David Lee (Twitter ID: SimpleMoneyZone).
Letter 1 of 2:
I had the worst performance Month of the whole Year. I looked into the system this morning and meditated myself. I want to share the following message to the whole room.
It all comes from ONE problem: “Fear”:
(1) Because of the fear of “Drawdown”, I redundantly added some over-fitting rules for the Type B LONG signal. It caused me to get in and out from the Oct to Dec single big dragon LONG trade that is supposed to have a >=5% gain but I got a losing trade. (2) Because of the fear of “LOSS” followed by another fear of “Missing Out” for the room, I missed the LONG train then jumped back to this Type B LONG signal at the later stage. It caused some additional losses. (3) Because of the fear of “ Risk”, I used some narrower stops for the Type A: oversold type of corrective bounce LONG. This got worse performance for this type of LONG trade. As a result, my decent +8% performance in Sept/Oct was zeroed out all due to “Fear” in the last two months. My YTD therefore dropped from +24% to +16% as of 12/24/2022.
My goal for 2023 is to stick to the system RULES by being “FEARLESS”:
(1) System rules are the rules that cannot be updated or created if no historical data exists to support the changes. (2) All the trades will be executed at the market closing price ONLY based on the system backtesting procedures, except for stopping out intra day. (3) Stop losses cannot be adjusted to the narrower ones for avoiding risks. (4) In general, the system has a 70% win rate across all types of LONG/SHORT trades and I can lose 30% time across all of the trades.
It is my first time co-leading a great group under pressure and I will learn to grow with all of you to have a stronger mind slowly but surely. I am very optimistic for the performance in 2023.
Everyone has a good holiday and happy new year!
All the live trades from September can be found in the following link:
Disclaimer: Trading stocks involves high risks and you can lose money. You are responsible for your own investment decisions.