Trading results and conclusions 2017

Hi there. I want to show you my trading results for this year and tell about experience which I received. There is a saying: The cobbler always wears the worst shoes. In our business there  is a lot of mistrust to all who teach others how to trade. Because we don't know exactly is this person really has success in trading or just talk about. (see full video here: https://youtu.be/n-nzeHBnN20) 

 I was trading on real account on Russian market (MICEX exchange) during 9 months and right now I will show results and conclusions which I did during this period. This is my equity curve. As you can see I started with small sum about 300 000 rubles (equivalent 5200 USD) and during this year I invested once more than 700 000 rubles ( about 12100 USD) on this account. So my total investment was  one million and sixteen thousand rubles. It was about sixteen thousand three hundred dollars.

I chose MICEX Exchange for several reasons. Firstly this is real exchange, not a FOREX or CFD or something else. I can see my orders  in Order Flow and I don't trade against my broker. Secondly  futures here  have very small initial margin so I can trade a lot of instruments in the same time. 

I invested not so big sum and it was experimental account so for me more important was final result in percent and approving of my ideas. I traded mostly futures and options and rarely stocks. I used about 5 - 7 strategies in the same time and bet with a little size. And I like what I received because it was corresponded with my theory.

First of all I received very smooth curve without big drawdown. It's not  the biggest profit which I received, nevertheless  I think this  is the best result which I have ever had. I had much bigger profit in money and much bigger profit in percent.  But I have never had so consistent result.

Every month I had profit. Average profit was about 4-5%. At times  I had profit about 7-10% per month sometimes about zero. But in general I received 373 000 rubles (it’s about six thousand and four hundred dollars) or 37 % per 9 months or fifty three percent for the year.

Let’s check more in detail how I did it. If we check my performance report I have one-third more profitable positions than unprofitable ones. But my average profit trade is too small about two hundred and fifty rubles (it's about four dollars) and my loss is two hundred and ninety rubles or five dollars. I did a lot of trades about ten thousand. Because I know that only on big figures we can receive true result. 

My biggest drawdown was  13 416 rubles (it's about 250 USD) but it was part of my delta hedge in my option strategy. The biggest true drawdown was 7711 rubles (about one 130 dollars). The biggest profit was a bit less: 6328 RUB  (about 110 USD).

But usually my profits and my losses were much less. Now it looks unbelievable that I had average profit 4 dollars but eventually I made 6.4  thousand of profit. But answer is about 10 000 trades during about 150 working days (I didn't trade every days). When I trade it was about 50-100 trades per day.

I used scalping strategies, intraday position holding strategies. I traded several instruments in the same time. And in one of them I hold position during several seconds in another I was in position all day. I used diversification and my bets were small.

What I found out during this period? First one there is not any "the best strategy" (holy grail) which you could use everywhere. Every instrument has own character expressed in volatility, reaction on news, correlation with others similar and so on. What can be work good for one instrument  might be not useful for another one.

The second one - timing has very big influence. Input in trade before fast movement - this is real mastery. And vice versa to be in position before balance or whipsaw it's bigger risk to receive stop loss, you hold your initial margin, you can't trade other possibilities on this instrument and pay a lot of your attention sometimes without any result.

And the last one but the most important it's using of your money management. Usually traders don't account power of compound interest and power of big drawdown, and possibilities of big series of unsuccessful trades. And also in this case usually people underestimate the impact of psychology. But impact and pressing yours profits and losses on yourself could be very big.

What else? You should have a rational expectation from your trades and you should  be in agreement with it. And better to undervalue your skills than overestimate them. We often do unreasonable actions and should understand that we sometimes can't control ourself. It too difficult and sometimes useless to fight with our emotions so we should accept them and to make an amendment about them in the future.

I wish you good health (this is the most important), good profits, and be more happy!

Merry Christmas and Happy New Year!