Cash or Crash?

The trading blog read only by very nice people!

World Cup Winner!

Posted by robbiechicago on June 9, 2010

Hello.  False alarm, people.  This is not a post about trading.  This is a cheeky plug of my World Cup blog which I will be updating during my month in South Africa watching England try not to fluff it on penners again.

My suitcase is bulging but tightly closed and I’m about to head off to the airport to catch my flight to Cape Town.  The month that follows promises to be like nothing I’ve ever experienced.  If you want a fan’s eye view on the games, the tournament and the country, follow my blog at

www.england2010.wordpress.com

Good luck to you if you’re going to trade the games.  I’ll be nervous enough without having that to worry about!

COME ON ENGLAND!

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She just doesn’t get it!

Posted by robbiechicago on March 12, 2010

I took the day off yesterday and ended up spending much of the afternoon in the park with my sister-in-law Tam, pushing her son on the swings.  Our chat came round to my interest in going back to university, but the conversation came to the same stumbling block as my plans:  Finance.  I found out yesterday that, even if you didn’t take a penny first time around, there is no way you can get funding from the student finance people if you want to do a second degree.  Damn.

I really want to pursue this path, but I just don’t know how I can pay for it.  I just don’t have enough money to last at least 3 years with no income.  It’s very frustrating and we both racked our brains for ideas.

Now, as many of you will know, I am going to the world cup in the summer.  I will be going to all England’s group games, and then to each of their knockout games following them or whoever beats them up to and including the final.  Tam, bless her, said that I could sell my World Cup tickets.  “Er, no” I said.  “Fair enough” says Tam.  At which point I mentioned that I had wondered if England did get to the final how much I would be able to sell my ticket for.  I think I’d pretty easily get over £10,000.  She said that at that point it would become a no-brainer:  You sell it.  I goggled at her.  “Are you serious, woman?”  I stammered.  “Of course you sell it!” she said, bemused.

She just doesn’t get it.

I firmly believe in having no regrets in life.  You make decisions, some of them are good, some are bad.  However, if I had in my grubby paws a ticket to see England playing in a World Cup final and I flogged it, I know with 100% certainty that it would be something that I would regret for the rest of my life.

Having said that, presumably there has to be a limit.  I mean, if someone offered me a million quid I guess I’d take it.  I wonder at what point the money would become too much to refuse.  I don’t want to think about it.

COME ON ENGLAND!

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Oh poo.

Posted by robbiechicago on March 10, 2010

I’ll blame today on the fact that I was, after this post and subsequent discussion from JS, playing with Quantsports, the advanced charting tool for Betfair.  I’m kidding myself, of course.  I was poor today.  Might as well have been trading the kind of racing illustrated below…

I suppose if I’m going to take some solace out of the day it’ll be that to be honest my trading wasn’t all that bad.  What as bad was my attitude.  I started badly but clawed back a few wins only for it to go pear-shaped again.  This time though I lost my head and lumped money at the markets.  Stupid stupid stupid.  The first time I did it I eventually settled for a whopping £1.73 loss.  Then, when it happened again in the next race I decided to leave £6 outstanding on the back side and hope that the nag in question won and bailed me out.  An complete gamble which, probably for my own good, didn’t pay off.  I packed up for the day at this point and went to have a cup of tea and play Guitar Hero.  Rock and roll.

I made a small amount back betting on the Man United game (god, Milan are rubbish, aren’t they!) but all in all a day to forget.

As for Quantsports, it’s all a bit complicated and I didn’t see much benefit in the short time I was playing.  First of all I need to figure out what each chart type actually means, then find a way that it can give me some kind of advantage.  It’ll cost £8 for me to play with it for a month which I think is pretty reasonable.  JS, I might be coming back to you for some assistance in the next few days, mate!

Here’s Wednesday’s pooeyness:

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Mistakes Creeping Back

Posted by robbiechicago on March 9, 2010

Yesterday was a nice simple easing back into the murky depths of trading, today was a little trickier and some bad habits came back to haunt me.

Most of the time I think I traded pretty well and was fairly disciplined, but as before, it was when things turned against me that my response wasn’t great.  I am trying to drum strike rate, strike rate, strike rate into my mind as I think this could be the key to success.  However, a good strike rate will be ruined if the losses are large.  I had wins of 7p, 11p and 9p in the first three races of the day, and this was followed by a 15p loss.  In this case the loss was bigger than the individual wins, but small enough to be swallowed up by the positive strike rate.  However, the next race saw a £1.36 loss.  This kind of thing can decimate your bank and needs to be stamped out.

I’m almost embarrassed to write about how the loss occurred.  The mistakes made were the same as those I made time and time again last year.  You’d think I’d learn!  I used £2 stakes again today, but in this losing race, when the market moved against me I attempted to cover the loss by putting more money in and hoping the tide would turn in my favour.  It didn’t, of course, and instead of scratching out for a moderate loss I had to swallow a huge one.  I really need to be better at reacting more quickly when things move against me.  But the problem is, very often I do find myself a few ticks out of profit, wait and the market does move back and I’m back in business.  It’s difficult to know what to do in these situations, as many of my wins will come about to being patient and waiting for moves.  I guess I have to avoid falling into the trap of lumping more money in as this is where the damage is multiplied.

Anyway, as I say, most of the day’s trading was fine and I clawed myself back from this losing position to end the day 54p up.  Much of this came when I got on the back of a superb swing and made 52p from a £2 stake.  Lovely stuff, would like more of those!!

Right, here are the day’s numbers.  Hope you all had an enjoyable one.

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It’s just like riding a bike!

Posted by robbiechicago on March 8, 2010

Trading seems to be just like riding a bike:  You never forget how to do it.

Whoopsie!

Actually, the good news is that I didn’t select this picture to illustrate a wobbly and knee-grazing return to trading, I chose it solely because all good blogs should have a picture of a child falling off a bike.  Now there’s a challenge for the rest of you!

I expect you’ll all be wondering a) where I’ve been, b) why stopped trading, c) why I’m back and d) what my plans are.  Well…

a) I’ve been right here, not doing much at all, I’m afraid to say.
b) I stopped because I was sort of offered a job which I was very keen to pursue, and once that seed had been sown I felt no enthusiasm for trading which had become rather stressful.  Inevitably, after the initial approach, the potential job seemed to fizzle away and I was left wondering if it was going to happen or not.  After a few weeks I began to forget about it, assuming that it wasn’t going to happen.  I decided that I’d go back to work anyway.
c) I’m back because the potential job is now definitely off the table.  And without going into it, I was messed around royaly by the company involved.  Grr.  Of course, that doesn’t entirely explain why I’ve not found myself something else work-wise, as planned.  Well, this leads me on to…
d) … the fact is, my plans have changed again, or at least I am mulling over new plans, plans that involve going back to university.  I am seriously tempted to embark on a career of study and, perhaps, lecturing, in the fascinating and never-ending field of Theology (a fact which has stunned my friends and family given that I am a committed atheist!).  Right now I cannot afford to go to uni, and I have been racking my poor brains trying to figure out how to fund several years of study until I can get to the stage when it becomes a profession.  Hence my return to trading.  Perhaps if I pick up where I left off I’ll be able to finally find that consistency that might lead to a small but reliable income.  Sheesh, I must be stupid…

So, today was my first days trading since, ohh, 2009!  Blimey, I didn’t realise it had been that long.  Obviously I dipped my toe gently into the choppy waters so as not to dampen my spirits too soon, and all in all it was rather nice to be back.  In fact, I ended up notching up a perfect strike rate!  I have seen that others have found success with a tightly disciplined, conservative approach where building up small but regular gains is the key to long term success.  I need to keep this in mind and STICK TO IT in order to actually make this work.  I enjoyed today and was pleased with how it went, but remember all too clearly that there are days when things go as expected and days when they don’t, so I’ll not be relaxing just yet.

I’m glad to be back amongst friends!  Now I just have to remember how my spreadsheet works..!

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Hmmm

Posted by robbiechicago on March 6, 2010

Shall I get back into trading?

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A.W.O.L.

Posted by robbiechicago on February 4, 2010

It’s been nearly a month since I posted.  Apologies for my silence, I’ve been hiding.

Can't see me!

Since I was last among you all, things have changed.  I have been approached about a job, and whilst it’s by no means a cert that it’s going to happen, the very idea of it settled in my mind and has changed my view of where things are going, whatever the outcome.

I began trading back in August and was working at it almost full time, so there can be no suggestion that I didn’t give it enough time.  Time and money were certainly something I did invest, along with no small amount of emotion and effort.  As you’ll see from my posts and my results, I had many lows, several highs but the learning curve was a steep one, much steeper than I had anticipated.  I didn’t enter into it with any misconceptions.  I knew that the superstars like Peter Webb and Adam Heathcote are the exception rather than the rule.  I aimed to eventually be a tenth as good at trading as they are, and that would be very nice indeed.  Both of these chaps deserve respect and admiration, the former for his years of continued work in the markets, the latter for his obvious natural talent in the field.  Both of them are inspirational, but I never saw myself reaching their heights.  I didn’t rule it out of course, but aimed somewhat lower.  However, that said, I did expect to see more improvement in my own trading after 6 months.  The absolute key thing for me is that after all this time, trading did not feel any easier.  I had identified errors and reduced them, and I am sure my trading did improve, but it just didn’t feel like I had made much progress.

So, you’ve given up then?

Well, yes and no.  I have, it is true, stopped.  But I think it’s important to distinguish between stopping and giving it up.  Had this potential job offer not come, would I still be trading now?  Almost certainly yes.   Will I start trading again?  Probably not.  Before it came, I had not considered going back to work, but once the idea was on the table and I began to think about it, it seemed like the right thing to do.  I have eluded in past posts to the fact that my money was beginning to run out and I might need to get a part time job to keep the wolves from the door while I learned how to make consistent profits from trading.  So when this approach came along it made me think about the bigger picture and whether I should move back into the 9-5 life.  Surprisingly, the idea appealed.

In the weeks prior to the approach, when the racing was all but decimated, I’d been watching all sorts of other sports looking for trading opportunities.  I was looking to broaden my scope away from just pre-race trading as even when the racing was back to normal it would be good to diversify somewhat.  (This reminds me of when I missed out on a nice big win – I had noted Peter Webb’s post about laying at 1.01 when he saw the odds of defending BDO darts champion drop to rock bottom in one match, only for his opponent to come back and win.  I had been looking for opportunities to play with this low risk/high reward strategy and it appeared at the end of the snooker Masters final.  I’d actually stopped trading that day, having made a really nice profit on the over/under 2.5 goals markets earlier in the day.  When Ronnie went (I think) 3 frames up with 4 to play, I thought about having a look and laying him, but having made some reasonable money already I decided to get out while the going was good.  We all know what happened next:  He didn’t win another frame!  As he was losing I checked the historical odds, and sure enough he’d been trading at 1.01.  I could have got in and made a killing.  Hey ho!)  Anyway, after discussing this job opportunity and mulling it over, I settled down to watch some football.  What I felt when I watched that game under no pressure to seek out value was relief.  I could actually watch the game without constantly analysing it and questioning the odds.  It was an eye-opener.

As things stand, I’m in limbo.  I’ve stopped trading, and I am waiting for something to happen with this job approach.  If it does I’ll be happy.  If it doesn’t, I have decided to look for full time employment.  So right now it looks like my attempt at becoming a professional trader is over.  But, as the last few weeks have shown, I will never say never, and things may change.  Indeed, I’m rather bored now that I don’t have trading to occupy my mind, so I might actually do the odd hour here or there just for something to do.  I shall certainly continue to read the blogs of those who shared the struggle with me, and I hope you all have the success you deserve.

Rob.

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Cold, and getting colder!

Posted by robbiechicago on January 9, 2010

Like most of you, I’ve done no trading for what seems like ages thanks to the freezing weather.  Most days have had just one meeting, a scenario which makes for unusual and unpredictable trading, so I left well alone.  I also ignored those days with two meetings just to be on the safe side.  I can see lots of frustrated traders all clamouring for action which could lead to more weird happenings.  So Chicago Trading Central has been a quiet place of late.  I have considered looking at other markets, but I am reluctant to get involved with much in play trading.  Perhaps this is something I should look to change as I know that many successful traders do spread their talents widely, Peter Webb being a prominent member of this club, something he commented on today.

Something else I’ve been working on is spending time analysing the relationship between weight of money and price movements.  I have come to realise over the last couple of weeks that my trading is based far too much on hunches and reactionary moves, and not enough on considered reading of market data.  I know now that this has to change if I am to be successful.  Relationships between WoM and price can be seen, but I wonder how indicative they are in real time as opposed to after the event when the whole market can be seen.  What I mean by that is it’s easy to say “yes, that spike in WoM clearly contributes to the price drifting” when you can see the full extent of the WoM and the complete drift.  But what about all the smaller spikes and troughs that, in the bigger picture, are easy to ignore?  How does one filter these out in real time?  It all goes back to my previous post about finding a way to ascertain what is a genuine move and what is red herring.

The prospect of trading in the near future looks slim.  The weather looks set to continue to disrupt things at the courses, and now it’s also scuppered things for me.  My boiler packed up yesterday, so now I have no central heating or hot water.  This would be bad enough in such cold weather, but the fact that the damned things is less than 2 and a half years old makes it even worse.  And getting a plumber out seems to be more difficult than it should be.  I may end up retreating to my mum and step-dad’s house for a while until the temperature increases.  The problem with that is that their internet connection isn’t all that great so even if there is more action with the horses I’d probably not risk trading.

Hey ho!  Lets hope things improve soon.  Brrrr!

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Frozen out

Posted by robbiechicago on January 4, 2010

Happy New year everyone!  Shame there’s only one meeting today.  I think I’m going to take the day off as I would imagine having such little action the markets will be a bit weird.  So I’m going out to play.  If only there were some snow…

Thanks to those of you who commented on my previous post.  But the consensus view that I should be using small stakes only serves to highlight the utter frustration I sometimes feel.  I did exactly that not long ago, dropping back to £2 stakes, starting from scratch, going back to basics.  That went pretty well, I reeled things in nicely and, after a few weeks, began to up my stakes again.  I’ve been there and done that.  Do I really want to go back?  I’m not sure, but I guess if I have to then I have to.

The other point about finding an edge is very important.  I think this baffles me a bit, to be honest.  I know how certain races are likely to behave, but that’s about it, to be honest.  What I can’t seem to do is predict which way a swing is likely to go, or filter out the real swings from the red herrings.  I am sure the successful traders don’t hang around and wait to see if a move will develop into a full swing.  If they did, they’d miss most of the move.  So how do people know?  Maybe they don’t.  Maybe they jump on any move and get out immediately if it doesn’t instantly progress.  Again, this gets to the nub of one of my problems, in that I get hammered in volatile markets.  If it starts to move I’ll leap in.  I’ll maybe pick up a couple of ticks, and then they’re gone straight away and the market moves the other way.  So I get out and try again, time after time, with the same result.  This leads to several small losses which, of course, added together, make a bigger loss.  Not only do I not know how to profit in such an environment, I also don’t know how to identify this market until it’s too late.  I’ve seen, and been burned by, false swings by the time the volatility becomes apparent.

So, do you play the waiting game, watch the market and see what it’s doing before entering, but risk missing out on what maybe the only decent swing?  Or do you take any opportunity you see in order to maximise your chances of catching a move, but risk hitting a string of false swings?

This all needs some thought.  Any successful traders out there have space for a spectator?  I’d love to see how it should be done.

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Crappy New Year

Posted by robbiechicago on December 31, 2009

What a dreadful day.  Yet again I have taken two steps forward and five back.  I simply do not know how to convert these bad days into something less financially destructive and emotionally demoralising.  My good days are still too few, the bad days are very often massive and more than wipe out any progress I’ve made.  It’s so incredibly frustrating.  I wouldn’t mind if I could pinpoint where I went wrong, but days like today seem to have absolutely no logic to them, and I just don’t know how to trade in these conditions.  How the hell are you supposed to make money from markets when they’re completely random and seem intent on throwing up as many false signals and red herrings as possible?

I know there are many traders out there who can operate in these conditions.  I wish I could see what they see.  It’s also frustrating that after all this time I’m still no closer to cracking it.  I’m not stupid.  I’m a smart bloke who has overcome more difficult things than this before.  I can’t believe that this is beyond me, but days like this just baffle me.

So, that’s five months traded, and five losing months.  Things were so bad today I never looked like putting together the run I needed to make December profitable.  The progress made over the last couple of days has been blown away and my confidence is back to rock bottom.  Unless I can figure out how to avoid blowing great chunks of my bank every few days this whole thing is going to end in dismal failure.

So, good riddance December, good riddance 2009.  Another month begins tomorrow.  I wish I could go into it with even the merest hint of confidence in my ability to make 1p profit over the next 31 days.

I hope your day, month and year have been better than mine!  Have a good evening tonight – Happy New Year!

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