I started my trading journey back 1999 and made more money in a year than I’ve seen in a lifetime.
Unfortunately, I lost it all within the next year when the market turned down. It didn’t take long to realize I didn’t know what I was doing and the only reason I made it as good as I did was simply, as the saying goes, Even a monkey throwing darts at a chart could have made money in 1999.
If I wanted to be a “trader” I knew I had to learn how to trade in all markets. So I started my search.
I lost track of that search over the years because I was hired by an online trading firm to write articles on technical analysis but the whole time I knew I was missing something. I began to realize almost everything I was espousing was mostly rhetoric and not much substance.
Some of the oratory I found unsettling was, “Let your profits run and cut your losses.” What does that really mean? How much profit? At what point do you cut your losses? You cut them too short and you’ll never make it as a trader. Then the one that really started to grate on me was all the different “Holy Grails” out there. Everyone seemed to have a different indicator, a different way of manipulating price and volume, so they just knew what the market was going to do.
I remember attending a class where the instructor told us you know the money is starting to flow into the stock when the 3 min MA crosses over the 7 minute MA. What? And he said this with a straight face? My first reaction was, “What does the 7 minute MA crossing over the 13 minute MA tell us?” How utterly ridiculous. How do you know, what empirical evidence do you have to be able to stand up in front of us and tell us something like this? Hogwash!
Trading in the Zone
Then I found Mark Douglas’ book Trading in the Zone. I knew that I had found for what I had been searching for years.
It was a plan, or better yet, an automated plan. A plan I could backtest and get the empirical evidence I so craved. As well, I knew I needed an automated system so I could take the emotion out of trading but, more than anything, I started to realize, all the hard work had to put in well before you ever entered a trade. This would keep the actual art of trading very very simple. An interesting side note was that ever technical analysis article I had published up to this point, and there were many, finished off with, Plan your Trade and Trade your Plan. Little did I know way back then, even before I read Mark Douglas’ book, I knew actually what I needed. This book just puts words to it.
The Ensuing Years
No need to go into what happened in the years from when I read Douglas’ book to present day. But suffice to say, by 2012 I had become very discouraged and was almost ready to throw in the proverbial towel.
I didn’t know how to find a plan let alone how to automate it.
Although I expected the same old, same old, I decided to attend one more class, and from this one course, I walked away with the answers. This particular course virtually changed my life, or tobe less dramatic, my trading life. I truly mean this, it changed the trajectory of my trading career.
The Teacher Appeared because I was ready
Interestingly, if I had taken this class at any other time in my career it probably wouldn’t have made the difference it did. You know the proverb, “The teacher appears when the student is ready.”
This class introduced me to Quantitative Trading. Trading that did not involve any kind of guessing and was your pure “Plan your Trade and Trade your Plan.”
From this course:
- I got the basic algorithmic code from which I could learn the syntax I needed to code my ideas.
- I learned the software I needed.
- I found the best data provider.
- I got everything I needed to springboard me into my own algorithms.
I don’t want to bore you with all details (probably too late for that) but after hours and hours (and I mean hours) of work and thousands of dollars, I had all the strategies coded. Then I spent way too many hours optimizing and tweaked them to make them the best of the best. The results of all this work are what you see in the QiT portfolios.
There is a lot more to this story, how I took algorithms and made them my own but that is for another day.
We’re the Plan in “Plan your Trade and Trade your Plan” – TraderJanie
“If awesome were inches, we’d be the Effiel Tower.”