Apologies for the long break from blogging, and sad to say that moving forward the frequency of blogging will be low, the reasons for which are shared below. Here is/are a few of my reflections on 2019 and my plans as I look forward to 2020
What I learnt in 2019
Trading wise, it was an average year, nothing exceptional, however, with close to 5 years in trading and increasing capital base, my ability to size bigger on the same intraday time frame was a concern.
Diversification across time-frames in trading can help in smoothing out the P&L curve.
Diversification is also necessary as your capital base increases.
% of Snake oil sellers in Trading is way more than what I thought. So learning to spot one can in itself be a major edge in trading.
If you are after big money, and have serious intentions to make a business out of it, look at a scale-able business model, there are limits to how much you can grow your own money. Unless of course you are a billionaire yourself, then your concern should be to diversify your investments to achieve a optimal risk-adjusted return. But then if you are a billionaire you would not be reading this.
Design Trading strategies and systems, with consistent but a moderate alpha in mind.
Look for structural edges, for example “Theta decay” in Options is a structural edge, meaning its largely independent of other factors.
Avoid people who sell one set of Indicators/Indicator based strategies like plague. That will save you a lot of time and time is money.
Social media can be a great place to connect with some great minds, but its your sizing skills that matter, the ratio of good to bad is close to 1:1000. Blindly block people who tweet motivational and inspirational quotes, its akin to porn, gives you a delusional high. A lot of people who actually are subject matter experts wont have time to tweet, so they are not going to clutter your feed.
I lost my mother this year, and that made me realize the importance of taking care of one’s health, seeking medical attention on time, and thinking fundamentally about what is it that you want to do to be remembered by others when you are gone, and its absolutely fair to ask the question - How does it matter if I am remembered or not? Its personal at the end of the day.
Time flies and as you get older it flies faster. 2020 is there and we are almost 2 weeks into it. Anyways.
On the trading front this would be a year of diversification, on both product and time frames. I intend to trade Stocks as well in Short Time-frames and Options on Longer time frames.
I would also be testing and trading variants of the traditional StatArb and Relative Value Arb. strategies.
Automation is another major area of focus, meaning I would work on making all my strategies fully automated. This is the reason I expect to be more time constrained this year than earlier. That would also mean, a restriction on the intake for my mentoring program.
I would also be cutting down on Social Media interaction and time, so expect to see much lesser tweets, not that I am big on it.
Moderate focus on Health, again its a matter of time and priority, would be focusing more on function than form.
Thanks again for your time and reading about what I had to say. Will keep you all posted as I move forward on this journey.