Saturday, May 31, 2008

May 2008 Monthly Trading Review

DTs monthly results in graphical form... nerdy, eh?


(h/t Tyro for helping me with the chart)

At the end of April, for the first time in my 9 year stock trading career, I took a stab at setting some monthly goals for myself. Apparently, forecasting isn't my forte.

I didn't get even remotely close to meeting my modest monthly profit goal, of $6000. In fact, I was down on the month, to the tune of $675. Not good. I'm new to this "setting goals" game, but I guess I should roll my profit goal back somewhat for June.

In May, I set a target of $300 a day. In June, I'll set a target of $250 per day, or $5000 for the month.

Another goal I set and missed was my "win/loss ratio," that is, positive days to negative days. Look at this particular stat as a measure of my sanity. I figure if I can just be green 75% or 80% of the time, I'll be generally happy with work... it won't feel so "grindish." So for May, I set a goal of 3 green days for every 1 red day.

Instead, I was green 11 days of 21... about 1 to 1. Pretty awful. I was probably in a bad mood for most of May. Indeed, reflecting on my actions during the past month, I was a dick.

Nevertheless, in June, I'm going to keep the 3 wins for every 1 loss goal.

So how did I get here? I started the month in a total tailspin, losing 5 of the first 7 days. I lost $915 on my worst day of the month. That's too much. One of my goals for this month was to limit my worst day to -$600. The silver lining is that my second worst day was -$509 and after that, every loss was sub $500 and most, far smaller.

So I limited my losses quite well, overall. I didn't have any crazy blowup days that saw me screaming, red faced, at the computer. That's a positive as far as health and mental stability are concerned, surely. And that's important.

I've started over, basically. Trading a completely new style almost exclusively for the entire month. And it's not just the trading style that's completely different. Trading style goes far beyond watching exits and entries and figuring out which stocks to watch. Trading style also effects the pace of your trading day, and your expectations throughout the day.

Early on in my career, and up until very recently, I actively traded the open, somewhat like a madman. I just don't do that anymore, and I feel the "extra space." Sometimes it feels like boredom and a lot of the time, frankly, it has felt like lost opportunity. It's definitely made it harder for me to focus... because without positions, I feel my mind wandering.

Just look at the statistics. In February, I averaged 24,800 shares traded per day. By April, I had dropped down to 12,900 average. In May, I averaged just over 10,000 a day. So I'm trading half as much as I did just a few months ago. And last year? In May of 2007 I averaged nearly 40,000 shares a day. So transition is occuring. Change is happening, and relatively quickly.

And don't forget... I'm doing this on my own. This blog is my sounding board... I trade remotely, without the benefit of talking to other traders each day. I sometimes wonder if I traded in an office if I wouldn't already be out of this slump. The point is, I think change goes much slower when you do it by yourself and without the group dynamic that an office provides.

However, later in the month, I started to feel like I was finally getting used to the "extra space." I can see how, in the near future, it will be an asset. I'm starting to feel less pressure on the open to be active for activity's sake. I'm slowly becoming more calculating and watching for eventualities and waiting for scenarios to develop and play out. It's a mental shift. I watch fewer stocks, more actively, instead of watching many stocks with less focus devoted to each.

If I can get through this summer and come out in September a more confident, stable, profitable trader, these months of indecision and worry will be worth it. If September comes and I'm not seeing any improvement in my trading, I'm really going to have to start considering a second stream of income. That will be the theme of this blog for the next few months... me continuing to work out the kinks, hopefully getting leaner and stronger as a trader, and all the while imagining what else I could possibly do for an income.

It'll be interesting. Let's see what June brings.

Anyway, thanks to Tokyo Trader, you can see a spreadsheet of the VO members and our stats for the month, here. (Just click over to where it says "VO May 2008..." The first page is just my stats.)

I'm not good with graphs and stuff, but if anyone can explain how I can make a graph of my P&L showing the cumulative results as the month wore on, I'd make it and share it as well.


Tyro said...

Hey DT,

"if anyone can explain how I can make a graph of my P&L showing the cumulative results as the month wore on, I'd make it and share it as well"


1. Copy the data into a new google spreadsheet (or edit this one if you have permission).

2. Assuming the first daily P&L appears in cell B2, go to the cell to the right and above (C1) and enter in "0" (without the quotation marks). This will be your equity at the start of the chart - make it whatever you like.

3. In C2, enter in "=C1+B2" (without the quotation marks). This should show up as the sum of 0 + your first day, 168.12.

4. Select C2 and hit Ctrl-C (Copy), then highlight all of the other cells in the C-column and hit paste. This column will have the running total of the month's total p&l

5. To graph this, select all the cells you wish to graph and click the 'insert chart' button (in the toolbar on the far right, looks like a small bar graph). Probably you want the line graph.

I created an example at:

All I can say is that it looks better than my equity curve for May.

Dinosaur Trader said...


Hey, thanks a lot! If you could explain that to me you should be a teacher... you'd probably be really good with "special needs" children, in fact.

I appreciate it.


mOOm said...

The trend after the big drawdown is OK, so maybe you need to revisit that daily maximum loss you were using earlier? Maybe more comments later.

Dogwood said...


What did you do prior to day trading?

Dogwood said...

Just spent way too much time reading your archives. Loved the posts regarding your intro to day trading. Are you still working on the book? If not, you need to finish it. Those history posts are good stuff.

Dinosaur Trader said...


Prior to daytrading I made advertisments for a Wall Street firm and wrote phony articles for their brokers to publish (aka public relations).

Thanks for the kind words about the history posts... I just don't have all the time I need right now to write them... maybe after I get the Series 55.


bl said...

Ask yourself: Is my trading style working or not and interview yourself. Don't revenge are dead with that. Identify what you do and see if it works then test something to see if it works consisently.