It’s been one heck of a year and if I’ve learned one lesson it’s that I still love trading, no matter how hard it gets.
A Lot Has Happened In One Year
A lot has happened in the last year, just like it always does. It’s been one helluva a year for me and one in which I learned many lessons. The first lesson is to be nimble; I was too rigid in my trading so when the market entered correction I couldn’t accept it. That rigidity kept me from trading as I should have, selling rallies and buying dips, and caused me quite a few losses.
The second lesson I learned is that I’m much better off buying and selling my NADEX options nearer the money than I was before. Sure, it’s nice to turn $70 profit on a trade but I rarely did, trading options at $30 or selling them at $70. The market almost always moved my way, just not enough for the trades to close in the money. That brings me to my third lesson, the one most important to my long-term success. You have to sell to make money.
This lesson is multifaceted. Not only do you have to sell your options when they are showing profits, but you also have to sell-to-open options and trade bearishly when the timing is right. Regarding selling my trades when they show profits? Well, I watched all too many of my trades move into profitability only to watch them later close with a total loss because I didn’t sell them when I should have.
So, my new philosophy on profits is this. There are no bad profits, only bad losses. I will not feel bad about taking a small profit when I could have made a big profit, because I could also have a bad loss. It doesn’t make any sense trying to make that last $5, $10, or even $15 dollar in contract value when I am already showing a profit of $30 or $35 per contract.
What Happened Last Year? I Switched To NADEX
When I looked back on last year’s end of year recap I was surprised to be reminded that last year was the last year binary options flourished. By flourishing, I mean millions of scams, a new broker to review every day, and free reign for the industry. New laws in the UK, the EU, and enforcement action from the US, the UK, EU, and many others, put an end to the wild west that was once binary options.
What this meant for me was a full switch to NADEX. I had been using NADEX before but not as much as my favorite spot-style brokers, brokers where I held a definite edge over the market. I have found that NADEX is a great place to trade but one that is quite challenging, especially when market volatility is high.
Unfortunately, I have suffered some heavy losses this year (some are due to a fat-finger mistake I made ordering a BTC position) but not so much I have to stop trading. That will never happen. I am down about 40% for the year but seem to have found my stride again in the last two months. I’m not making big gains but I have recovered some of my losses.