I’ve been training for a race lately. So my time on the treadmill has been on the heavy side. The good part is, that gives me lots of time to listen to trading and investing podcasts.
Last week I told you about the chat with a trading psychologist. And this week I have two more Chat with Traders Podcasts that I wanted to share. The first one was with Jerry Parker, and the second with crude oil trader Tracy aka ChiGrl.
As always, the podcast does a great job sharing educational trading lessons. Below are my unedited thoughts, while listening to the podcast.
Jerry Parker Podcast:
Trading is hard. It has to be. It’s not easy. Low win rates are okay. Drawdowns are good. Do the uncomfortable.
Think of optimal loss size… Not too big or small. Aims for 40% win rate
Diversify trades across time frames.. Some systems are faster or slower than others (eg contrast 100 day breakout with 300 day breakout).
Sample size of backtest is most important thing in trading (qualitative!)… Too many variables in system limits sample size (which really matters in fat tail environment)
Build robust systems. Bet small. Buy rallies and sell the lows
-your head is your enemy – keep yourself out of your way. Make the same trades again and again.
The market likes to balance itself
No matter you’re doing or trading passion/enjoyment can help fuel your dedication. But you need a system to make it automatic. Don’t use discretion until you’ve been doing it for 10 years.
What’s going to make the market react?
If you rely on fundamentals, know your market:
Rig count is a poor proxy for oil production right now
About guessing or predicting and just rare what’s in front of you.
Patience is very important to long term success. You don’t need to be trading all the time. Wait for the opportunity to come to you. Trading should be boring. I talk about trading more than I trade. Avoid overpaying your broker!
Random: Wunder Capital was the sponsor on one of the shows. Don’t know about this company in particular, but it’s neat to see impact investments coming to retail market so quickly.