Update on Webinar Series

An update on the webinar series. We will be sending out individual responses to each of the registrants. However,  here is a quick snapshot.

There were insufficient registrants to conduct the 3-series webinar. My apologies for disappointing those who registered. In our letter to you, we’ll provide the three areas to focus on to overcome the Hidden Barriers to Trading Success.

Webinar Series

BarroMetrics Views: Webinar Series 

In response to your request, I’ll be running a 3-part webinar series for the material I presented in Singapore on June 22: provided we receive enough numbers.

The proposed dates are: July 6, 10 and 17, 7:00 PM (HK time). The material covers the “Hidden Barriers to Trading Success” and includes a mechanical system I use to illustrate the “hidden barriers”.

What I found interesting was the fact that the ‘hidden barriers’ were operating for all the world to see at the presentation! No wonder over 90% of retail traders fail at trading.

We’ll have the registration page up by Monday, June 29. Registrations will close Thursday July 2. I’ll confirm July 3 whether the webinars are on. The series will be recorded, and the recording made available only to attendees. 

Last Call

BarroMetrics Views:  Last Call

My last call to register for the Investor Wealth Summit in Singapore on June 20 and June 21 at Suntec City, 1 Raffles Boulevarde, Room 324.

The registration link is below: 

http://www.investorwealthsummit.com/ray/

It’s always nice to hear that some attendees who are coming a long way just to attend my talk: Perth, London, Lisbon.  Welcome and thank you.

I’ll be speaking from 11:30 to 1:00 PM and presenting material I have never before presented. I was interviewed by Income and Assets Magazine, and Bill Bodri, the interviewer, said that he had never heard of an interviewee cover the topics I raised.

Some of these topics I cover at Investor Wealth.

Here’s a tidbit: We now know that humans abor uncertainty. Whenever we meet situations of ambiguity we look to inject certainty if only by making the decision. A decision made, for this reason, is probably going to prove to be the worst one possible. This is especially true of mechanical traders who use system rules as a way of defeating emotions. The problem is emotions cannot be controlled. Indeed the more we suppress them, the more likely it is our emotions will come back and bite us.

Then, as my Singaporean friends would say: “So how?”

That question is part of what I’ll be looking at my presentation. In the process, I’ll look at a setup that has proven to right 72% to 86% of the time across different asset classes.

Hope to catch you on June 21!

The link again:  http://www.investorwealthsummit.com/ray/

The Hidden Reasons Why Over 90% of Traders Fail

BarroMetrics Views: The Hidden Reasons Why Over 90% of Traders Fail 

                                    (and What You Can Do About It!)

That’s the title of a 90-minute presentation I shall be making on June 21 in Singapore.

To register go to http://www.investorwealthsummit.com/ray/

And yes, it’s a free event, thanks to the sponsorship of OandaMoolahSenseOne Capital Holdings, and MIDAS  Development Corporation.

I’ll be producing all new material – stuff I have never before presented. In fact in the light of the recent research in some areas, I have redone the entire MIND section of my Barros Swing module. The presentation is extracted from that section.

To understand why I am so ‘chuffed’, you need to appreciate that for years, I have been seeking to solve the conundrum: how can I help traders achieve their trading dreams?

While I have had some success, that success has been well short of what I wanted, and what I believed was possible. Now, thanks to the recent breakthroughs in learning and behavioural change theory I believe I’ll see the success I have wanted for traders.

I am very excited about the presentation! It will introduce:

  • A learning model to acquire the knowledge, and to translate the knowledge into a skill set.
  • A model to deal with those pesky impulse emotions that ruin our ROI, ‘fight, flight, and freeze’.
  • A model to reduce our reliance on WILLPOWER to maintain our trading discipline. Willpower will always play a role in the exercise of our discipline. But, with this model, you can reduce willpower from 90% to 10% of discipline!

The presentation will also explain

  • A mechanical system that contains rules for trading continuations, and for trading, changes in trend. The ‘two in one’ system!

I’ll be teaching the mechanical systems as a live illustration of the three models.

If you are in Singapore, I’ll see you there. One thing. If you intend to register, do it now – the organisers tell me the seats are filling very quickly.

Achieve A Breakthrough

BarroMetrics Views; Achieve A Breakthrough

I’ll continue with the ‘Inflection Point’ series  tomorrow.

Today, a quick review of a 2-day seminar I attended in Singapore last week.

On my last trip I was flicking through the Strait Times and came across an ad for ‘Master Class Series: Achieve a Breakthrough in Sales Performance’. I enrolled for it – not expecting too much. In fact, I had told my business partner, Peter Ow, that I may see on the scheduled second day, if the first showed I would not add to my store of knowledge. The fact I stayed for the two days provides a clue about how beneficial I found the class.

So what does a self-described ‘sales seminar’ have to do with trading?

Actually the seminar was only indirectly linked to selling. The first day dealt with the Psychology of Performance – what it is, the mental strategies of top performers and motivation. The materials applies to any field of endeavor. The second day dealt with communication. Sure the examples were slanted towards sales but the subject matter applies to any communication:

  • Being fully present
  • Reading the conscious and unconscious communication patterns of others
  • Establishing rapport
  • Use of language for clarify another’s objectives

Long-time readers of this blog know that I see ACT (Acceptance and Commitment Therapy) as the key to improving our trading performance in particular,  and living happier lives in general. The material over the two days slotted nicely into the ACT Hexagon. (Figure 1)

Finally a comment on Jensen Siaw the presenter. Excellent. On a rating from 0-10 (where 10 is the best), a 10. He is knowledgeable, entertaining and is able to get his message across. My biggest fear was I’d have to sit through two days of droning lectures. I needn’t have worried – he gave a good show that transferred knowledge.

His website:  www.jensensiaw.com

As always the disclaimer: I receive no benefit from posting this review. I am passing on what I experienced as a worthwhile experience.

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FIGURE 1 ACT Hexagon

Review of Trades

BarroMetrics Views: Review of Trades

Last year, Feb to Mar I had one of those trading periods when we wonder why we took up trading – close enough to a 16% loss. It followed a fab final 2013 that ended to Jan 2014.

This year, a similar occurrence except that rather than losing almost 16%, the Feb to May results have so far been equivocal. And the reason for the improvement? I made an effort to understand why exceptionally large losses occur from time to time. As you may have read, I decided in ‘ebb’ phases to exit much quicker. This means I have to be clear about what a trade must not do after entry. It also means I  may miss a move or have to re-enter at a worse price than the original entry.

The May results provide an illustration of the way I review my trades.

Figure 1 is part of the sample of stats my spreadsheet produces. We see that to date, for closed positions, my net result is -$4132.00. It says that I have made 15 trades with about a 50-50 win rate. It appears that my average profit is less than my average loss. But, appearances can be misleading. Turn to Figure 2.

Figure 2 is an in-depth review of Figure 1.  Since I don’t day trade, in Figure 2, ‘Day Trades’ mean early exit. We see that so far:

  1. I have had 3 overnight positions (ON) amounting to losses of -0.05%.
  2. I have had 2 overnight positions amounting to profits of 0.067%
  3. The early exits are showing a profit.
  4. I have two open positions.

The question arises what would have happened had I not exited early? Yes, some trades would have shown more profit, but the additional winning trades were overshadowed by trades with larger losses. The net result for late exit would have been a May showing a (3.8%) loss.

The early exit review is only part of the story. For my equity journal, I also look at:

  • The instruments results
  • The rules results
  • Whether initiating or responsive entries are working better.
  • Whether I have made mistakes (i.e. broken my rules).

Journal keeping and review, time consuming? Well, you could say that. But, I would rather engage in this activity rather than watching TV!

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FIGURE 1 Prelimin Stats

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FIGURE 2 Review Stats

The Need for Practice

BarreMetrics Views: The Need for Practice

Tying in with yesterday’s topic….

Trading may be simple but it is never easy – it seems always to involve competing interests e.g. we need find the optimal position size to maximize profits and minimise loss; we need to cut our losses but need to let profits run etc. So too with acquiring expertise.

We need to spend time if doing – but doing using a specific process so that we learn from the practice, and in so doing build expertise. But, this practice, this building, requires us, at the very least, to experience the discomfort and anxiety that cones with pushing past the  boundaries of our comfort zone. Our success is dependent on experiencing the discomfort; for unless we experience the discomfort and anxiety, we shall not learn,

Recently I concluded our Foundational Course – a low entry into the world of trading success. It provides a Method with a positive expectancy with the aim of instilling the  necessary habits for trading success – like: keeping an equity and psych journal for each trade.

At the end of the session, an attendee approached me and said:

“Is there an easier way? Keeping the spreadsheet and emotional entries is a lot of work. And, learning the system is difficult”.

To me that’s akin to saying: “I want to win the Boston Marathon but I don’t want to do the roadwork that I know is necessary. Is there an easier way?

The short answer is: “There is no easier way”. Your success builds with baby steps, with each step laying the foundation for the next.

Comfort Zone

BarroMetrics Views: Comfort Zone

Daniel’s question dovetails nicely with the topic of today.

Last Saturday and Sunday, I was in Guangzhou and Shenzhen to give presentations for Oanda. Each venue had around 300 attendees, and the attendees at the two locations could not have been more different.

Taken each audience as a whole:

  • at the former, I saw a willingness to change and embrace change in areas that were not working for them;
  • in the latter, there was more a tendency to stick with their comfort zone even though the results they were attaining were less than optimal.
  • At the former, they asked probing questions about change;
  • at the latter, they tended to ask questions seeking answers to confirm their preconceived ideas.

And this brings me to Danie’s question (See comment in Learning Process II).

‘Comfort Zone’ is where we act as a matter of course. In trading this may include ‘trading without trading rules’, or trading ‘too small size’, or ‘refusing to define a “get out strategy” before taking a trade, etc. In short, it can be defined as a ‘habitual process’ that causes us no discomfort. In and of itself, the habitual process is neither ‘good or bad’  – we need only change the process if it is not (or is no longer) serving our needs and goals.

To answer Daniel’s question…….that depends on the sum of your Expectancy Return.

(Average $Win x WinRate) – (Av$Loss x LossRate) = ExpRet

Determine the ExpRet  that defines your long-term goal, slot in your WinRate and LossRate, and you will have the minimum Reward:Risk you will need to generate your ExpRet. If you find you have room to increase, then do so in graduated steps.

Another area where ‘comfort zone’ raises its head is in the area of stop use and stop placement.

Stop use: Too many traders refuse to predefine ‘if wrong, exit strategies’. The unarticulated fear is the market will move exponentially in the direction of the trade (after being stopped out) without giving us the chance to get aboard. What is not envisaged is the market continuing to move against the position until the adverse move wipes out the account.

Stop placement: If you find that you are continually being stopped out only to have the trade then hit your profit target, this means your stop is too tight. You can use Maximum Adverse Excursion to work out what your minimum and maximum stop should be.

‘Getting comfortable with discomfort’ means taking the action we have decided will move us to our goals – even though the new action causes discomfort (usually because it’s an action we have not undertaken previously).

Flu et al & Greece

BarroMetrics View: Flu et al

A killer flu is sweeping Hong Kong – there are fears will see around 200 dead and the epidemic last until April. Yours truly was struck down on the weekend and has only felt somewhat back to normal today. I have had the flu before but not like this: fever, runny nose, a chronic cough, congestion and phlegm. Luckily the only symptom remaining is a body filled with sore bones. Seeing the price some of the others have paid, I am one of the fortunate ones – especially if you consider my age.

My flu couldn’t have come  at a most importune time. Crude. S&P, AUDUSD and EURUSD all at critical junctions. I’ll say more about that next week.

Today let’s turn to Greece. At the Macquarie  Securities event on Feb 4, I said that one of the possible Black Swan events to affect the markets would be a Greek exit from the Euro zone. It is a ‘black swan’ not because it cannot be foreseen but because few believe it will happen; and most believe that even if it happens, there will be no contagion.

It’s now looking that the odds of a Greek exit have risen from improbable to possible. The next question is, what will be the effect?

My view is in the short term, a few hours or days of volatility, and then back to ‘normal’.  But, in the long term??? Given the feelings in Spain and Portugal,a Greek exit is likely to lead to an attempt to exit the Euro Zone there. And, if those exits happen, there will be contagion.

For me, Greece is like FACTA – quietly working away in the background, and by the time the  damage is seen, it will be too late.

Let’s see what happens.