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No Pain No Gain!

Updated 9/17/19

The following post was from April of 2013, one of my first posts that received a lot of views.
I archived the post a long time ago after feeling like a hypocrite for not following my own repeated observations of my performance. I have hundreds of other posts that have been archived because I felt I was not living up to the standards I set for myself, I will be dusting off some of these old posts as I now realize how humbling they are, and also satisfying for my ego. In the post No Pain No Gain, I touch on being right about market direction, but not having the grit to stay in my position. The truth is, I rarely maintained a healthy amount of leverage in relation to the size of my account. As I am working on building my portfolio for the long haul, slow and steady is the trading lifestyle I am building for myself and my family. --

Originally posted 4/15/13

"I am usually right about market direction, and often wrong on how bad I think my position is becoming."

The title No Pain No Gain sounds a lot like a lead into pumping iron, lifting weights till your muscles pop; so what does a blog dedicated to the lifestyle of retail traders have to do with pain & gain? For those who have done any strength training or engaged in long-distance running can attest to the fact that improvements in the amount of weight one can lift or the distance and speed he or she can run does not come by taking the easy route; the discomfort our bodies experience improves our ability to lift heavier weight or to run further and faster.

I am usually right about market direction, and often wrong on how bad I think my position is becoming [I assume like most traders]. After a recent drawdown in my discretionary account [-$400] I was thinking about my previous successes and past drawdowns, my biggest gains came after periods of enduring a market pullback, having to hold a position or multiple positions when my emotions wanted to cut my losses and run. In my biggest gains I stuck it out, I don't hold on to looser in fear that it will wipe me out [to a fault], I take on too many small losses that eat away at previous profits...  I can't just dumb it down to simply over trading, or trying to be smarter than the market.

Ready for the link between strength training and trading? Not sure how to quantify how much pain a trader has to endure, but I am convinced we have to regularly expect the pain to come. Factoring pain into your trading plan may provide the edge you have been looking for. If you don't want to associate pain with trading, you can use the word patience, but I think that word patience in relation to trading has been so overused that it has lost its meaning and impact. 

[Pain begins when the market tests your comfort level]

When I envision myself being patient waiting for a trade to happen, I see myself calm, cool and relaxed. This idealistic illusion of myself is mostly true when I am profitable; I can't say the same for when my position is in the red. When I am down in a position, I have a tendency to overcompensate trying to be Mr. Fixit, I need to develop some rules to my trading method on how much fixing I am going to permit myself to do. Instead of being down $400 for the year, my account would be near $2000 + by simply doing much of nothing, maybe a few tweaks here and there, but very little.

I began the year with a buy and hold strategy that worked well, and would still be working if I would have left it alone. As the CEO of my own [very private] hedgefund, I will have to lick my wounds and consider this another learning experience that will make me a better trader in the future... I am sure of it. 

For your amusement, and my painful reminder  I included some of my previous posts that led me to get long early in 2013, I will try not to kick myself for not sticking to my original plan;  but as I look at what I posted, it will be hard not to.

[Unfortantely some posts were deleted]

Like every trader, I was mentally preparing for the new year
Dec 2012 - How's The Year Going To End?

This is the post that started my long-term strategy, I love the title "Conviction"
Jan 2013 - Conviction

My obsession with the DJIA and its derivative DIA 

DJIA averages 4% - 9% annual return (why try to fight it when I can join it?)
Jan 2013 - Markets Rise

Started calling it a strategy 
Jan 2013 - Long Term Option Strategy

Sticking with the strategy 
Feb 2013 - Still Long The Dow

The market pulled back and Mr. Fixit stepped in 
Mar 2013 - Buy And Hold Not For Long

Mr. Fixit did enough damage, I closed everything
April 2013 - No Pain No Gain

Good trading to you all!


  1. I couldn't help but noticed you followed my Dad (Trading Breakthrough) on Twitter today, have a look through his blog as well and you'll find many useful tools to stop Mr. Fixit doing anything.

  2. Thanks Liam, I will check out Trading Breakthrough.


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