In my last post, I said the market gave a warning signal.
It has been a week since I started reducing position size.
Cutting the Entrance
Before, if my trading amount was 100, now it is only 10 to 50.
I cut it by more than half.
Backtesting a system is one thing.
Trading under stress is the real challenge.
Even with an automated system, checking the market scores every morning in a BEAR MARKET is very stressful.
Early to Bed, Early to Rise
I live in Korea.
I check the market before it opens and again when it closes.
I go to bed early because I want to use my early morning time.
The US-Iran conflict makes the market a roller coaster.
It is easy to ruin your sleep pattern.
But this year, my stress is much lower.
This is thanks to reducing position size.
Last year, I was greedy.
I didn’t reduce my position size even during a crisis.
My mind was broken every time the market dropped.
But now, I am stepping back.
Even when the market hits me, I can enjoy my morning coffee and a cigarette calmly.
It’s like a fleet commander keeping his ships safe from a big storm.
The Bubble in the Korean Market
I will also keep reducing position size in the Korean market until the military conflict ends.
The Korean market is rising too fast.
It is in a “bubble” state.
My alpha system, Brawler Strategy, uses statistics and machine learning, but it has never experienced a bubble like this before.
Even the system says, “This is my first time!”
So, I stepped in and started reducing position size manually on March 27.
Goal: Survival
When the US market finds peace again, I will bring the trading money back to normal.
The scariest enemy in trading is not the market.
It’s the feeling of being in a hurry.
Like the Brawler Strategy character, I might get hit, but I must stay in the ring.
I will avoid fatal wounds and survive.
That is the real Law of Large Numbers.
I hope you stay calm and follow your own rules in this wavy market.
Have a peaceful night.
Stady as she goes.
Related Articles (관련 글 보기)
- Step 1: What My Trading System Does When the Market Warns Us
- Step 2: What I Learned After Reducing Position Size During a Storm
- Step 3: Protecting the Account: Why I Reduce Position Size
