Question:
I was a corporate accountant out of college, which I found to be boring, unrewarding work. I slowly got into options trading in 2004 because I really didn’t have much money and it was a way to maximize my gains. I quit my job in 2007 and have been trading full time ever since. I just completed a P&L of my trading since 2007 and found out that I have not made a dollar doing it and actually lost almost $15,000 in 2 years!
It’s amazing every time I close a position with a gain it invariably runs another 100%. When I let my winners run, I end up turning them into losers. I always cut my losers, but, when you trade options, you have to be perfect or you can lose 50% in 3 minutes. In spite of all of this, I really believe in my heart that I can be successful at this.
This is probably the longest question you have ever received, but I feel as if I am at the lowest point I have ever been in my life. At the ripe old age of 32, my career seems to be over. I am no longer a viable candidate in corporate America and the one thing I love to do I am awful at, no matter what adjustments I make. As someone who hears from many traders, can you relate to where I am? Can you offer any advice to get me out of this slump? I really need your help because I can’t really talk to anyone about this because they don’t understand.
Frank from Longfaceville
Answer:
Frank, I am surprised that it took you, an accountant, two years to realize you were losing money. Successful traders know their positions and their financial standing on any given day. In tournament poker, if a player does not know where he or she is in a hand, folding is the prudent option. It sounds as if you do not want to fold, so I suggest you act more like an accountant when trading. As to letting your winners run and then finding you lost your profits … The only way this “strategy” works is if you protect your profits. Obviously, you are not doing this. Consider learning more about trading options, if you want to continue trading options.
Yes, I can relate to your problem, and here is my “tough-love” advice. At 42, I lost almost everything in a failed business startup. It knocked me on my ass for several years. Then one day, my pathetic concern for self-loss ended. I kicked myself in the same fallen ass and started again. It took some time, but today, I am in better financial shape than back then, and I am enjoying life more than ever. You, my friend, are ten years ahead of my pace, and from what you have written your position is much better than mine was in those dark days. So buck up, kick yourself in the butt, and stop focusing on self. Look out to the world, draw the outside in to fill the pathetic void, and move forward. Oh, and if you can’t figure out how to make money at trading, find something else to fill your passionate side and do that.
Trade in the day; invest in your life …
