The previous week James, Nick and I (Buzz) met in Bristol for a few days for a day trading pow wow.
Our agenda was to agree a defined method of trading, to backtest that method in detail and agree on markets we would each trade.
A comfortable aim at the outset, maybe. However, as with anything worth doing its beginning needed to bypass egos, emotions, ‘set in our ways’ experience developed over several years and, therefore, generalised methodologies. An immense struggle. But, we all felt that we had got to where we wanted to be by the end.
In our first week of trading following the gathering we had decided that for now each of us would trade a single but different currency market.
Trading multiple markets, although potentially providing more entry opportunities, actually resulted in more (early) abandoned trade entries as the observation of one market would often incorrectly influence the judgement on another.
Moreover, observation of a single market provides more harmony for that market as each pairing have specific traits, news related releases, spreads and a certain rhythm of volatility.
Even after a single week of applying the ‘only one market’ restraint, we have seen a significant jump in the possible combined trades achieved. We have each become a specific currency pairing specialist.
Not to say that having mastered the single market we will not expand to two markets per trader. At the moment, however, we like the results, and in any case, it is highly unlikely that we would take on more than two markets per individual.
The 4th amigo
We’re also in the very early stages of training a fourth member of the team. But it can take many months to years to bring someone up to partial let alone full account trade ready.
Plan, brief, execute and debrief.
Our muster in Bristol encapsulated our ‘plan’ phase of things. Our brief is our individual (written) mantra, and the ‘execute’ is our daily trades.
Publication of a weekly debrief in a video, or written format will happen via this blog. In the meantime, we discuss events between the team daily when we can via Skype.
James and Nick currently trade at the minimum amount. The next step is for them to participate at a quarter of full risk and so forth until able to consistently take maximum risk trades. (See blog post ‘conservative breakout trading’ for our risk amount calculation).