First things first. I did hold onto the morning gains and cut my size drastically on the few small remaining lures I put into the water. No sense trading late on a summer Friday on the first day of the month. Plus, I didn't see anything spectacular after the morning session. So for the first time in a while, I'd give myself an A on both reads and execution, didn't overtrade, and am satisfied with my performance -- for the moment.
A few weeks ago, I'd mentioned my recent poker experiences and the profound impact it's had on my trading. And one of the concepts that translates well to the trading industry is managing a growing chip count. For example, one of the huge flaws in my poker game -- especially in tournaments -- is getting sloppy with a large chip count. For example, I find myself playing many more marginal hands, essentially getting away from the tight play that grew the stack in the first place. And earlier this week, I did just that and went from chip leader among the remaining five (of 30) to the first one out fairly quickly. And what's interesting is that it's not like I start playing 2-7 unsuited ... rather I start playing hands like A-8 suited, or a low pocket pair that I don't fold after the flop doesn't turn up trips. Next thing you know, I wonder where the chips went and then have to play more aggressively to get it back.
Prior to this year, dealing with trading successes over a period of time was also a large issue for me. Yet ironically, I saw the problem much more clearly at the card table which planted one of the seeds for the fictitious draw approach. In other words, always play as if you have limited chips. Some traders accomplish that by simply withdrawing funds from their growing balances. At this end, I've chosen to deal with it psychologically by not viewing my balance and simply getting myself to believe a portion has been lost. All I can say is that in eight months of this approach, it's worked. And when something works ...
Which brings me back to this blog. As I enter the second month of my constant babbling after the looooong hiatus, I'm curious as to whether opening this frank and personal diary has been helpful to those looking over my shoulder. I do know hits on the blog have increased dramatically since we began this trek, simply through word of mouth and nothing more. And it's been intriguing to say the least at this end, as I feel a bit like Sidney Freedman of M*A*S*H writing letters to Sigmund Freud for therapy. I think it's been helpful for me, yet the truth will be known at the end of the year when I compare my non-blog performance in the first six months of 2008 with the post-blog performance.
I sincerely view this business as people helping people. Yes, it's a competitive market where equity is shifted from the large majority to the small minority. But to the extent we can support each other and help plant some seeds that grow that minority ever so slightly, I'd love to be a small part of that.
Feel free to comment as always.