Spoilers

Q: How did your managers react when the day ended?
A: They weren't mad. They know that sometimes shit happens (you think I'm the only one with a story like this?). They knew I was a risk conscious trader. I had almost zero history of shaky risk management (sans AAMRQ, which went from deep red to green in the span of minutes and was thus never discussed) up until that point. 

Q: Did you get fired from CCG?
A: No. My managers wanted me to stay. Even after the loss, I still had a positive equity curve for the firm (by at least $40,000 I think). But I told them I was done. That was the last day I ever stepped foot on the trading floor.

Q: Why did you leave?
A: I was actually set on leaving soon but hadn't yet decided when. This episode just finalized the departure date. Having to trade out of a $150,000+ hole before ever seeing a paycheck seemed unappealing. I still feel guilty about it.

Q: Why were you allowed to go so far past your loss limit before lockout?
A: There was no real-time risk monitor for OTC stocks. By the time they recognized it (through a phone call I believe), I was well past that mark. No one had the same experience level that I did on trading out of an OTC stock. My managers discussed it and decided to trust me to trade out of it efficiently and minimize the damage. I obviously let them down.

Q: Did you take a long break?
A: No. I felt compelled to keep trading FNMA and pot stocks. They weren't going to last forever. Staying in the game was the only way to mitigate the pain.

Q: What caused it to tank so much?
A: It's FNMA. That's just what it does.

Q: What caused the fakeout at 4.50?
A: Crowded trade. Too many traders making money off the same edge = oversizing = market wants to create more pain.... that's the metagame of trading

Q: Have you since eclipsed the loss with more profits?
A: Yep. And then some.

Q: No, really, do you actually make money?
A: Yes. Despite that loss, this is still my personal best year.

Q: What is your biggest regret of that day? (besides the loss, obviously)
A: That I didn't make 100k.... no seriously...



1 comment:

  1. What a fabulous article. Finally a honest story of a bad trade.

    ReplyDelete