An NYSE Scalper's Tale - A Trader's Diary

Thursday, September 28, 2006

It's Like Turning Into Darth Vader

Gross: +$536.00
Net: +$424.83
Loss From Top: $35.84
Trades: 92
Shares Traded: 96200

Stocks Traded Today (net profit/loss):
Advanced Micro Devices (AMD): +$193.63
Walmart (WMT): +$78.51
Corning (GLW): +$54.04
Exxon Mobil (XOM): +$45.03
Hewlett Packard (HPQ): +$43.86
Home Depot (HD): +$18.64
AT&T (T): -$8.90

On the way home today, I was trying to think of an analogy for what I've been going through. And I think I have found one (for those of you who have never watched Star Wars, this post will probably not make sense).

I think of all us traders as being Jedi (from Star Wars). We have basic Jedi (trading) principles and rules in which we must follow in order to be a successful Jedi (trader). There are some master Jedi (traders) with lots of experience and you can tell they can feel the force (the markets) and it almost seems as though they can predict or see things before they even happen.

I know all of us want to be the best Jedi (trader) and we all work very hard in trying to achieve this. BUT, we must resist the temptation of the dark side (the characteristics of the anti-trader).

Soo many Jedi principles can be applied to trading.

Master Yoda once said:

“Fear is the path to the dark side. Fear leads to anger. Anger leads to hate. Hate leads to suffering”

which I believe can be applied to trading. If you are fearing that you'll lose money or fearing you'll miss out on a great move and you lose money, you get angry. The more you get angry, the more you hate the markets. The more you hate the markets, the more clouded your judgement becomes and in the end, you'll lose all your money and suffer.

The last couple of weeks I felt like Anakin Skywalker. I would come in in the morning and say to myself "I want to become the most powerful Jedi (trader) there is out there" and in the beginning, I follow all of the Jedi (trading) principles and the morning goes just great.

But then I'd break a rule or two (like trade when I'm bored or put on a trade that breaks my rules). Then I'd get further seduced by the dark side and make decisions with emotions. The more action I take, the more I spiral out of control and the deeper and more attached to the dark side I become.

By the end of the day, I turn into something completely the opposite of what I started out as. It's like Anakin Skywalker turning into Darth Vader (the ultimate anti-trader).

So today, I tried very hard and not succumb to any of the characteristics associated with the dark side (anti-trader characteristics) and I had to hold myself back from trading several times. I managed to remain patient and there were very few mistakes made today.

I still don't feel very comfortable with the current markets and as a result, I have reduced my share size and I've been getting in and out fast.

Gone are the days of 8000 and 10,000 share positions - my confidence has been shot and the effects of the last two months are still lingering. Once the markets definitively decides which way to go, I'll feel more comfortable with more sizeable positions.

But in the meantime, I'll stick with 1000, 2000 and 3000 share positions for now.

And so, I hope all of us Jedi (traders) out there keep our heads up high and try very hard to avoid the dark side (characteristics of the anti-trader).

Sorry about this silly post - I just thought it described my situation and the problems I've been having lately. I'll leave you with some Jedi (trader) quotes.


"Beware of the dark side. Anger...fear...aggression. The dark side of the Force are they. Easily they flow, quick to join you in a fight."
- Master Yoda


"A Jedi must have the deepest commitment, the most serious mind."
- Master Yoda


"Once you start down the dark path, forever will it dominate your destiny, consume you it will..."
- Master Yoda


"The fear of loss is a path to the Dark Side."
- Master Yoda


Good Trades
None - just put on small positions and got in and out fast

Bad Trades
None - no mistakes were made today.

4 Comments:

  • Excellent analogy JC. Trading is one of the most humbling but very rewarding career paths. May the Force be with you!

    By Anonymous StockRoach, at September 28, 2006 7:49 PM  

  • Stockroach,

    Thanks for your comments.

    Yes - this post was a little silly...and somewhat dweeby! I was just having some fun with tonight's post. I hope the Force is with you as well!

    Happy trading!
    JC

    By Blogger J.C., at September 28, 2006 10:03 PM  

  • J.C, ah...brother Jedi. Hope we can see better trading days in October.

    Interesting post.

    Gav

    By Anonymous Gav, at September 28, 2006 10:42 PM  

  • Gav,

    Thanks for your comments.

    I can't wait to get September over with...one more day to go!

    JC

    By Blogger J.C., at September 29, 2006 7:23 AM  

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