A hands-on account of my CFD Day Trading experience from an absolute beginner

– How not to make the monumental fuck ups I did 🙁

Tabl

OK, so you want to be the next Wolf of Wall Street, drive the big car, have the big mansion, be your own boss and earn money whilst you sleep, well, I’ve got news for you, it ain’t gonna happen day trading, not unless you’ve studied meticulously and work for a major hedge fund or bank, and even then you need some damn good luck too.

And unless you have money that you can afford to lose, then I urge you to go elsewhere and look to do something with less risk, because it really isn’t like what you see in the movies.

However, I’m pretty sure if you’ve got this far you’re not gonna to listen to me anyway, so fuck it – read on and learn my friend and see if you can work this day trading shit out better than I can….!

Table of contents

My name is Guy and this is my experience as a CFD day trader, which I still have no idea what it means, so don’t ask!

I start from the beginning and bring you right up to to date to where I am now – I detail exactly what I’ve done and the monumental fuck-ups I have made, however if you want to skip all the blurb you can read my essential 21 Day Trading tips at the end then go ahead, however I would highly recommend reading it in full, it could save you shed load! 

So I have created this page to share my experience as a first time day trader in the hope that it will help others to make their decision whether or not they should dabble in the world of trading, AND I have also included an affiliate link to the ForTrade platform I use so that IF you do choose this path then you’ll help me a little to pay off the ridiculously huge amount of debt I have incurred 🙁

Join Fortrade for free

Disclaimer

I should say, I have absolutely no experience in trading, in fact I didn’t even understand some very basic rules, which I am almost embarrassed to share, but of course will. This is purely my experience as a day trader that I am sharing with you, and what I have learned about CFD trading, and by no means is professional advice whatsoever – in fact as you’ll read it’s pretty fucking basic, but I have to admit, it would have definitely helped me before I started day trading!

Before I go into detail of my experience, I want to say this: If you are adamant about trading, set a limit for how much money you are prepared to lose and stick to it. Do not throw more money at it, as it is likely you will lose it. Start off with very very small trades and slowly build up your account. Don’t ever get too confident as it will turn in a second and bite you in the arse.

The beginning of my Day Trading experience

I decided to start trading right at the beginning of COVID-19 thinking that it would be a good opportunity to buy shitloads of cheap stocks and once things returned back to normality enjoy the riches I would make. Sounds easy right? How I couldn’t be more wrong…

Over the last 3 months I have made so many monumental fuck ups it’s unreal and I wanted to share this with future traders as it really is a rollercoaster.

Which platform to choose for CFD day trading?

So the first thing you have to do is choose a platform to trade from.

After very little research and analysis I decided upon a platform called ForTrade. What I liked is that you were given an account manager and could also create a trial account to test some trading.

I liked the idea of having an account manager, as they could hold my hand during the learning process, and one of the good things with ForTrade is that you are given regular stock analysis to help with your trading.

During the initial introduction my assigned account manager, Danny, explained that it’s very simple:

When stocks are high you sell and when they are low you buy”. 

He also asked how much I realistically wanted to make, which is a very important question. I replied that I would like to make enough to eventually live off, but to start with I’d be happy with £2,000 per month.

I should also mention at this point, that my girlfriend also decided to open an account too, again with zero knowledge of the market, she had a different account manager, Rafi.

So after the initial intro meeting I used the test account for about 5 minutes to understand how the platform worked. I got the hang of it very quickly, it is a very easy system to use for beginners and the mobile app is also handy.

After a couple of trades I decided enough was enough and I swapped to the real deal.

A basic understanding of CFD trading with ForTrade

I should explain at this point my very basic understanding of CFD trading and how it works on Fortrade:

At the top of your trading account you have 3 important figures and one mega important graph, these are:

Account Balance – this is the total amount of money in your account

Open Profit & Loss (P&L) – this is how much you are currently making with your open trades

Equity – this is your Account balance +/- your open P&L

Financial strength – this graph shows how your financial strength is, I’ll try and explain a bit about this in a bit.

Fortrade day trading experience account status

So on the screenshot above you can see my account balance is €29,016.69 – this is how much money I have made and put into my account.

Sadly my Open P&L is -€3,596.98 – I have two open trades which are both in big negative equity at the moment boo hoo 🙁

So my total Equity is €25,419.71 – this is my account balance minus my open P&L.

Financial strength / Percentage margin

Right, this is such an important part I have given it it’s own section, however I still don’t understand 100% how it works, so don’t break my balls, but I’ll try and explain as simply as possible…

CFD trading is kind of like a seesaw: On one end you have buy trades, the other sell trades.

If you open too many buy trades without enough money in your account to balance the weight and the market drops to the point where your seesaw seat hits the ground, or in CFD trading terms your Financial Strength drops below a certain level, you will lose everything.

So the aim is to never let your account hit the bottom e.g. with ForTrade go below 50% margin.

If this does start to happen there are three things you can do to prevent this:

1. Put more money in your account so that it levels the balance

2. Open sell positions to balance the open trades you have, this is known as ‘Hedging’ a word I have come to detest. 

3. As a final resort you can just close your negative open trades, never fun, but sometimes it’s the best thing to do.

I think different brokers have different limits, for example with Fortrade the lowest you can go to is 50%. If your financial strength goes below this your open trades will close one by one and you’ll eventually lose your entire account balance, so it is absolutely crucial you stay above 50%. They recommend to always be above 200% as a minimum, but ideally you should aim to have 4-5 green bars.

The reason they say 200% is because the market can drop in a second and although rare, there is the potential for it to drop a considerable amount in a very short period of time, or if there is a market correction it can drop 10% which doesn’t sound like much, but I guarantee you it is and if you have open buy trades without Stop Losses you will shit yourself. (I talk more about Stop Losses later)

So as you can see on the screenshot below on a very rare occasion, despite my negative open P&L my FS is 4 green bars / 400% Margin Percentage which is very good (for more than 2 months I had been in the red which is a very unpleasant experience and I highly recommend to stay out if it!)

Fortrade account overview

Other platforms offer different levels of percentage margin, for example a very popular app called Robinhood I believe is zero, however from what I understand this is really risky as it could get you into huge amounts of debt, so make sure you research thoroughly.

So to recap, always always always make sure your percentage margin/financial strength is above 200% and never let it fall below 50%

My first CFD trade

Your account manager can’t tell you what to trade, just advise, and at the time Crude was his recommendation as it was going up & down around $60 per share.

So I opened my first buy very cautiously – 50 shares. The price went up and I then sold and made a small profit, happy days!

In the meantime my girlfriend also did the same, trading crude too.

I had my account managers wise words in my head: “when stocks are high you sell and when they are low you buy

So I was buying when the rate dropped and then selling once it increased, easy right?

As I became more confident I traded larger amounts.

Then one day I opened a buy trade of 250 shares and the price dropped, and kept dropping. I waited and nothing, it remained lower than my purchase price and I was in negative equity.

At this point I was a little worried.

My account manager then called me and asked why I had made a buy?

I explained that I thought the price would go up and reiterated what he had told me; ‘when stocks are high you sell and when they are low you buy

He then said something that changed the game:

No, what I mean is when the price is high you open a sell position!

Errr what do you mean?” I replied

Danny explained that you do not always have to open a buy position, you can also open a sell position if you think the stock will go down in price, so betting against it so to speak.

I had no idea you could do that, neither did my girlfriend!

It was a game changer.

I really felt so stupid.

So just to clarify:

You can either open a ‘Buy’ position if you think the stock will increase in price

Or open a ‘Sell’ position if you think the stock will decrease in price

when stocks are high you sell and when they are low you buy” – this now made a lot more sense!!!

But it didn’t help the losing position I had on a buy trade!

Crude oil contracts & A very expensive lesson

Something I also learned with Crude is that every month they renew the contract which can affect the price.

It was coming up to the new contract and this was just as things with COVID were really starting to kick off.

My account manager advised me that they were expecting the new contract to go down by 5-6 points so it would be wise to open a sell position.

This is where I had wished I had been trading for a few months prior to now and had a bit more experience and knowledge about the market – or even read a helpful article like this 🙂

I decided to take Danny’s advice and ‘risked’ opening a sell of 500 on the Friday before the market closed, which was the biggest position I had opened to date.

It meant for a slightly nervous weekend.

The market re-opened Sunday night and sure enough the price dropped by 6 points and I had made a healthy profit! Although the buy positions I had were losing quite a lot too, urgh.

I left the trade open and went to bed very happy.

The next morning it was going up & down, so much so without my knowledge, my girlfriend opended a buy position of 500.

And then it happened.

The price dropped and kept going down and down, I opened several sell trades as it flew down, it was literally raining money into my account, I couldn’t believe it!

By the time it reached its lowest point of $6 per share, I had €11K+ in equity!

I remember sharing screenshots with my friend as it was racing down and he was telling me to close and take the money.

Always take the profit when day trading

Even my account manager, Danny, rang to say that I had very good profit and should consider closing the trades as things can change very quickly.

By now of course I thought I was the Wolf of Wallstreet, a real pro and didn’t listen as I thought it might go down a little further and I could make even more, boy do I regret my naivety and not listening.

At $6 a barrel Danny was saying that I should really open buy positions, but I didn’t understand – it was going down, why open buys???

Then it happened again.

It went up and as it went up I was trying to close my positions but couldn’t because the price was fluctuating so much, I literally could not close them quick enough and watched in horror as my account leaked money.

Eventually I closed everything for a profit of €5k, not bad but it could have been so much more.

I learnt a very expensive lesson here: When the price is moving so much it’s impossible to close positions, so it’s better to set a Take Profit or Stop Loss, which I discuss shortly.

The other problem I had was the couple of buy positions I had made which by now were in big minus numbers, it was pretty scary, especially for my girlfriend who was in a real state.

As I explained earlier, with CFD trading you have to keep your margin level above 50%, if it drops below this you start to lose everything.

My girlfriends had dropped below 100% and with ForTrade your account then goes into danger red colour which really does send the shitters through you. She was convinced that crude would go to zero and her account would then be closed and she’d loose the €6k she had invested.

It was a hugely stressful time.

Trading hours

Something else which you need to consider are the different open/close trading hours for each stock.

Crude for example is open 23 hours a day Monday to Friday and re-opens Sunday evening, this meant that it could go up & down all day and night which led to many sleepless nights nervously watching the graph whilst lying in bed, it was and still is torture.

With CFD trading if you open both an equal buy and a sell position your financial strength is full as each one cancels the other out. However, unless you had a lot of money in your account, if you had several buy positions with no sell positions and those buy positions were in negative equity – such as our situation, your financial strength would be very low, and of course as the price was so low you couldn’t open another buy position as this would make your FS worrying close to 50%, and opening a sell position so low to hedge would be suicide.

So we were stuck in a very difficult situation, we knew the price would go up, but couldn’t do anything as our FS was very low.

The only way out was to either close our buy positions for a big loss, or put more money into the account. Closing was not an option, so we both ended up putting more money in.

By now I had put in €11k and my girlfriend €8k, more than both of us could afford, or especially to lose.

As Crude started to creep up I bought 500 at $11.

Over the next few days the price went up and down and we both made winning and losing trades, it really was a game of cat and mouse.

Take Profit and Stop Loss

When you open a trade you have the option to set a ‘Take Profit’ or a ‘Stop Loss’, which in theory you should use with every trade, especially if you are away from the computer/app, it’s a very good habit to get into from the beginning and I strongly recommend, but it takes a lot of discipline.

What is a Take Profit?

Here you can set your trade at a level where you would be happy to take profit, and the trade will automatically close once it hits that target. Essentially if you are following a graph it should be 2/3’s of the way up – do not get greedy.

What is a Stop Loss?

Like with a Take Profit, you can set a Stop Loss at a rate where you do not lose too much money – I urge you to use this with every trade, even if you are chained to your computer.

No one likes to lose money, but I 100% guarantee you that you will, so just make sure it’s not too much! Always use a Stop Loss, it’s better to lose £100 than to watch it go down to -£500 or more, it’s painful, really painful. This is usually set for example -£100 below the bottom of the trading line.

Trading Tourettes

One thing you will develop is what I now call ‘Trading Tourettes’ or TT for short

This occurs when you open a trade and the moment you open it, it then nose dives the opposite way, putting you in a negative position immediately. And then it continues to go the opposite way you had opened it for.

It really is as though someone is behind you watching your every move.

You’ll find expletives coming out of your mouth that you didn’t even know existed, screaming at the computer monitor praying for it to turn, and the sense of relief when it does is quite astonishing, but rarely happens.

I mentioned this to a friend who used to work for a broker and he said I was not far from the truth. The trading robots are designed to work on human emotion. They lead you into thinking one way and then go the opposite, and it works time and time again, the little bastards.

If you are an emotional person like I am, then day trading probably isn’t a wise choice as you will find yourself opening trades based on anger or delight and very easily get carried away. You need discipline and to be able to react logically, not emotionally.

Losing touch of reality

During this time I dabbled in a couple of other stock: Caribbean Cruises I opened a buy position for $27 and American Airlines I caught for $10, Caribbean I was really happy as I made €150 but American Airlines went straight into negative equity where it remained for a month and couldn’t wait get out of.

By this time I had kind of lost touch of reality and why I originally started trading, my mentality had changed.

I originally wanted to buy lots of very low stock and leave it for 6-12 months whilst the economy got back to ‘normal’.

However, CFD trading doesn’t necessarily allow you to do this as you have to be very wary of your Financial Strength, so my attitude changed and I wanted to make ‘quick wins’.

The way I was day trading now is called scalping – very little logic, just trying to catch runs up & down, which is a pretty risky way to trade.

Ideally I would have enough money in my account to keep it around 300% so if the price dropped I would have enough FS to cover it, however I traded very close to 200% all the time and a lot of the time I was below this.

Hindsight is a wonderful thing, just a shame you can’t do anything about it, except learn.

How I wish I kept all my load trades, I would be in a very healthy position right now.

So it’s important to remember why you start Day Trading, don’t forget your goals, some days you will lose, some days you will win and it’s important to know when to stop trading – If you’re having a bad day then stop.

Equally if you’re having a great day stop and take the profits before you get greedy.

How I wish I could listen to my own advice, it’s very hard 🙁

Happy days to sad (I wanna jump off a bridge) days - Market correction

As the economy started to improve so did my trades.

I opened a buy on the Australian 200, and had positions on American Airlines, Boeing and Crude.

I remember one day the market closed and I had 4 buys on American Airlines, and the next day when the market opened again it shot up by several points and I made €5K. I was very happy.

Again, another thing I learnt was that once the market closes, on some platforms it is still possible to trade, which means it usually always opens the next day at a different price, so be very mindful of this. If there is good/bad news over night and you have open trades they could significantly change once the market reopens and note that Stop Losses do not work if it literally B-Lines it down or up – they will skip past it and activate once the graph stops.

My other trades were in a great positions too. My Australia 200 had €13k, Boeing had €5k, Crude had €8k, in fact at one point I had about €60k equity on my account, but all in open trades.

As mentioned a moment ago; the markets usually always opens at a slightly different price and I use MarketWatch.com to give me an insight as to what to expect the following morning.

One evening I had a lot of Boeing’s open, and checked MW and saw it had gone up by 11 points which is a huge amount! I was on course to make €3-5k. I was waiting excitedly for the market to open.

Then it happened.

Totally be-known to me, the market ‘corrects’ itself.

So as prices keep rising and rising to unrealistic levels, it can reset itself without warning, which I think is a load of bollocks. How can it decide this for itself, but hey ho!

So there I was expecting to make a small fortune and boom, the market crashes by 200 points, everything I had was gone in a flash.

I was absolutely devastated

The mother of all fuck ups

This was a harsh lesson to learn, as my account manager always told me, when you have good profit, take it as the market can change in a flash, and the more I have traded the more I have seen that you cannot trust it. The big players control the markets, us day traders are merely their guinea pigs.

That morning I was in disbelief, it was hard to take, one minute I was texting my girlfriend to say we had a really nice deposit for a house, the next it was gone in a flash. However, I was determined to put that behind me and try again, the good thing was that the market had crashed so I had another opportunity to take advantage of the low rates.

So once again I buckled down and was determined to get back what I had lost – this as it transpired was again a big mistake…

I was in a way chasing my losses, which as we all know is never a good thing.

I still had a pretty good account balance, via my company I made use of a government loan scheme with very low interest rates which I used to give me extra leverage, which basically meant that I was trading in big numbers, which as a complete beginner was incredibly naive and inevitably led to only bigger problems:

Bigger Trades = Bigger problems

As the market started to go back up I was using my old friend the Germany 30 DAX Futures, my feeling was that it’s better to try to understand one type of trade than many, and I liked the idea that the DAX was dependent on 30 companies rather than just one, so in theory easier to determine, right?

You kind of try and get an understanding of the flow of a trade, you open a buy at the bottom of a line and open a sell at the peak, sounds so simple!

However, occasionally you get carried away and it’s very very easy to do. You see a run and it appears to be bombing up so you jump on and before you click the buy it’s already on the way down, this has happened to me so many times I’ve lost count. Equally, you think that a run reaches its peak so you then open a sell to make some quick profit on the way down, only for it to continue up. Sometimes you can find a nice run that’s pretty predictable, however they can and will catch you out…

I’d been playing a run all afternoon, it was getting to a peak, then going down and I’d been getting more and more confident; one run I was using 5’s, the next 10’s, making some really good profit. Then with one I got over confident. I opened 2 x 10’s and 1 x 20 sells, but the moment I opened the 20 it turned and went up and it didn’t stop.

Before I knew it I was -€2,000 and it didn’t look like stopping.

The BIG problem with trading the DAX is that it opens at 1am UK time/ 2am my time in Italy, so I was waking up to watch it go further and further up.

It had been a couple of days and I was seriously stressing, I needed it to come down badly, by now I was -€4,000.

Once again I woke up at 2am and watched it slowly come down and by about 3am it was going back up and I drifted off to sleep.

I woke up the next morning and it had really gone up, however around 3.30am (where I went to sleep) it had dropped down to where I had opened my sells – I could have closed the fuckers for zero, but I didn’t use a Take Profit – this is the single most biggest mistake I have ever made, and I’ve regretted it ever since. As mentioned, a Take Profit is where you can set an amount which when the graph reaches it will automatically close your trade and take the profit.

After this point it rocketed up, before I knew it, it was -€15,000 and I was at breaking point.

I was reading all the reports on Bloomberg etc and it was nothing but good news, it was expected to go up to 13,500 and I simply did not have enough financial strength to cover it, so I initially closed both my 10’s for a loss of €6k which really hurt.

But it still continued to go up and up.

I can’t tell you how stressful it is watching a losing trade lose more and more, especially when it’s big numbers. You ask yourself so many questions, why didn’t I close it, why didn’t I hedge it, why did I fall asleep, why didn’t I set a Stop Loss/Take profit etc.

One early morning around 4am, I had been up every night that week, I was dead, I had reached breaking point. Again I was reading more and more good news and in my mind I couldn’t see a way how it was ever going to go back down, so I pulled the plug and closed my 20 Germany’s at a loss of €16,500.

It was heartbreaking, totally.

However it meant I could have a good night’s sleep again, this at that moment was priceless.

Always listen to your gut

By now my friend Jonny and I were Whatsapp’ing every day & night, telling each other about our good runs and fuck-ups, and offering advice, which of course was meant in the best of intentions, but sometimes it really should be kept to oneself. Never advise friends or family what to trade, it just isn’t worth the guilt if they turn bad.

As per usual I got myself into a bit of a mess with a high buy, and was stuck at the very peak of the latest Germany run, whilst also stuck with some sells close to the bottom – not exactly the ideal situation and I needed a small miracle to get out of it.

For a few days I was trading in between my high buy and low sell praying that it would bomb up and then bomb down. Jonny was really eager for me to get out of the buys as he was adamant the market was about to correct and go down big time, he reads a lot of rubbish which makes him very paranoid, which then plays on my mind too.

One morning he text me whilst I was on the toilet asking if I had seen the graph. It was very close to my buys and it got to the stage where I took the hit and closed them at a loss. Of course, as always the market went up and I could have made some really good profit if I had waited. The morning market is always crazy and I should have waited for it to settle and continue on its trend upwards, another lesson learned.

They say never to trade in the first 30 minutes when the European market opens at 8am GMT and to also always be weary at 2.30 GMT when the US market opens, it is usually highly volatile.

That day I had my usual morning call from my account manager and he had told me I should have left my buys open as they were expecting it to reach 13,300, which I relayed onto Jonny. 

That day Jonny hadn’t had a good day, he always wanted to make big bucks especially on uptrends as he was totally fucked with some huge sells he made at 12,000 – very similar to me but he was adamant to hang on to them, wish I had with my low sells 🙁

The run started to go down pretty quickly, but as per usual on a run down it got to a stage where it stopped and started to come back up – this is very normal even on a big run down, it’s known as a bear trap. It makes you think it’s going back up, but then stops and continues back down, it’s a real bastard.

It had 2 peaks and Jonny sent me a message saying it was about to bomb back up – relying on the tip from my a/c manager that it was expected to get up to 13300. I sent a message back saying I was not convinced, my gut was screaming at me that it was going to have one more peak as it always did and continue to go down. I found there are always 3 peaks before it continued on its way up or down.

Nethertheless Johnny convinced me it was going up, so I then convinced myself

I had 20 sells open, so thought right if I open 35 buys if it hits 13,300 I’ll be able to close everything for zero. So within a minute I had opened 7 x 5 Germany’s, I cringe now just writing that.

Sure enough, just as it got to the top of the 3rd peak, instead of continuing up, it dropped down, and continued to drop down.

I was so angry I was screaming in a pillow.

I was so angry I couldn’t think what to do. 

I just watched in horror as it clocked up the money every minute. It was too late to close as it was already -€2,000 and by that time I was thinking semi-straight I opened up 4 sells to hedge, and then a few more.

It was more than 100 points after I decided to do this. I really hated myself; there had been times where I had buys and could see it was dropping so I closed at a loss and opened sells and made a small fortune, yet now I couldn’t do it, I had lost all my confidence and I had 7 open buys!!!

What transpired later was that it was the US non-farm job announcement which Jonny told me that evening his friend had told him, who was a very experienced trader having worked in the city for many years at a top trading company, that this was the single most important announcement in day trading. The entire market reacted to it, and I had no idea about this.

Of course the news was bad and the market bombed.

I was so fucked off. I had 7 x 5 Germany’s within minutes each was -€1,000.

As I thought the market was going back up I closed some of my lower sell hedge trades, for very little profit, but then it just continued to go down and down. I was in a real mess.

I was panicking. I should have left the 10 sell trades I had open and just left it, but you never know, that’s the problem.

By now my PL was about -€7k, not great, I was praying for it to go up so I could close my buys or at least go high enough to take a hit and close them and open more sells.

 

Just when you think things can't get any worse...

One morning Robi and I woke up at our usual 2am and prayed for the market to go up.

When it opened it did just that, it went up and up more than 100 points and I was just -€4500 off my PL. I said to Robi I could close everything now and open some sells and I’m sure I would make up the loss.

Alas I didn’t as I thought it would continue to go up throughout the night, so I went to sleep.

Waking up the next day it had bombed down, and that is my second biggest regret to this day.

From that moment on the market burst and in the following days the FED made an announcement to say that this is the worst pandemic we’ll ever see which sent the market spiralling down. I couldn’t believe I let this happen, Jonny too – he had been warning us that this was due to happen any day.

What’s worse is that I went to the gym the following morning after the announcement, I didn’t think it could get any worse, boy was I wrong.

It dropped 600 points within hours and I only hedged by the time I was -€12,000 on my PL

Each of my 7 x 5 Germanys was a minus €5,000

I now needed a total miracle.

Late that afternoon it started to go up, but still some 700 points where I need it to be.

It’s going to be a very long way back, I can’t see it reaching 13136 for a very long time.

If there is extremely good news about a vaccine then maybe, however the economy is destroyed and the DAX companies are reporting lower than expected profits.

My miracle came true!

The DAX slowly recovered and got very close to my high open Trades, so much so, Jonny who was incredibly stressed, closed all of his for a big loss of £3-4k. I on the other hand decided to patiently wait. Of course it dropped quite a bit and I was regretting not closing at a loss, however Danny was adamant that it was expected to hit 13,300.

And sure enough it started to go up, I was able to close those buys in pretty good profit and felt very relieved, they were around 13,135. But it continued to go up and up I was opening buys at a very high level, but making good profits as I closed when they came down.

I was very worried about the very low sells I had around 12,700, and Danny had told me it was expected to go up to 13,585, or even 14,000 reading some of the forum comments. It was quite stressed!

Holiday from hell

By now it was close to the end of August and my girlfriend and I needed a break, a relaxing holiday doing nothing, so we booked a pretty nice looking hotel where there were amazing beaches and good food.

On the morning we were leaving I had been doing some trading and was very close to €30,000 in my account balance. So far every time I had gotten close to that, I fucked up and lost a few grand, and I was determined to get there before we left. I had already made €700 that morning, so just needed another €300. I was going against everything I had told myself and trading in 10’s, not only that but in multiple trades. But I was doing OK that morning.

I had 2 x 10’s open at around 13140 but it dropped so a common thing I did was to open up two more 10’s below and when they went up to a point I could zero everything at break even I would. However, this time they didn’t go up and bombed down – just as we were supposed to be leaving for our holiday, not the best of timing. I was so angry with myself as I knew immediately this would ruin our trip away, and before I knew it, it was down to 12,900 and each of my trades were minus €2,500 each, I was a total mess.

I was praying for it to go up every day, waking up at 2am and watching the graph all night was not my idea of a relaxing holiday, it was soul destroying, however, then it happened…

On the 2nd September it bombed up! Of course I had no idea when it would stop so I closed my first 2 low 10’s for a tiny profit, and kept my other 2 open until it started to go down quite a lot, so closed for around €1,500 profit each, boy how I wish I kept all 4 open.

Day Trading experience - Dax bombing up!

As you can see on the graph it almost got up to 13450 and in my head I had Danny’s comments that it was expected to go up to 13585 and I was pretty scared as my FS would be very low so I had to hedge.

Usually at this rate you just need to open one or two at most to hedge, as it was very unlikely to go much higher and I always told myself, and even that morning told Robi, that for every peak it had always bombed down.

I sent Danny an email that morning asking him if a Market correction was due:

Day Trading Experience - Market correction

He replied with:

High expectations for the DAX day trading experience

Despite this my gut was screaming at me to open a sell, as the forums were saying it was due to go down, however I trusted Danny.

That morning we were going to a beautiful area with 3 secluded beaches and a very well-rated restaurant. I thought OK, if it’s going up to 13585 I’m going to make the most of this and opened up not 1, not 2, not 3, not even 5, but 7 x 5 buys. As I write this I’m almost crying. I really only needed to open 1 just to hedge. Robi was urging me to set Stop Losses, I did but then it dropped so I removed them as I knew the graph was programmed to set them off. As I opened the 7th all were in pretty good shape and we set off for our day trip.

I was of course watching closely on the app on the way there, but then we hit a dead zone, which continued all the way to where we were going, by the time we got there it was about 30 minutes and I was panicking. There was WiFi at the restaurant but it wasn’t working, I was so stressed.

It got to the point where I took the car and drove to a spot where I had internet again. I was semi-relieved as some were negative and some were positive so I left them and went back.

An hour later I called Jonny just to make sure all was OK, he told me it had dropped a bit but was on it’s way back up so didn’t think anything of it. How stupid could one be? ‘Incredibly’ is the answer.

We tried to relax on the beach but just couldn’t so decided to head back to the hotel, what a waste of a day 🙁

Another big mistake here was that I left my phone in my rucksack which was in the boot of the car. Little did I know that Jonny was desperately trying to call me.

Despite all the warning signals, forum comments and from my own experience I ignored it all.

On our way back to the hotel, via a supermarket to buy booze and nibbles, this was happening:

Day Trading experience - DAX bombing down :(

My worst fears were coming true. A market correction. It dropped 700 points and each of my open buys, one of which is at 13,462, were now -€3,000 or more. I had a mild heart attack.

This was the penultimate day of our holiday and I had started my week -€4k on my PL to ending it -20k, I was in pieces. 

On our last day we were supposed to be going on a day long boat trip to lots of hidden caves and beaches, but I couldn’t risk having no internet, so we decided to head home early as later that day was the US non-farm payroll results.

It was a horrible 2 hour drive back and even worse once we got home as it continued to go down and down. I am now having to hedge at very low rates to keep my financial strength above 50% which is just soul destroying.

Because it had tanked so much so quickly I was not able to open any hedges until very late, and then when I did I thought it was bouncing back up so closed them to take the profit – another mistake, DO NOT take profit from hedges, just let them run to zero using Stop Losses. It of course turned and headed down again and I have had to hedge even lower, it’s a total mess.

It got so low that at one point the 2 open sells I had at 12700 were just -€250 each. Why on earth I didn’t close them both then as I had hedges above is beyond me. I waited until they were -€1,100 and closed one – again another big mistake as my FS strength dropped down to 100%.

It was and still is a very stressful time, I’m really not sure how much I can take.

Eventually it slowly went up to close to 13k, but I need it to hit anywhere close to 13,400 so I can close my high buys for a loss of €3-5k. I would be happy to lose €3-5k at this point in time. And I did not open any further hedges – another mistake I am living to regret.

I am already dreading the week ahead. To think, if I took the €700 I made on Monday and did nothing but open a sell at 13,400 like my gut was telling me, I would be out of this mess and have good profit. What a difference a week makes, but that’s what happens with stupid decisions.

Desperate times call for desperate measures

The market continued to drop, but now looks as though it has hit the bottom at around 12,350, and I have been desperately trying to hedge as I really do not want to leave open sells so low. The problem is I’m losing a fortune doing so, last week I lost €4,000, it is demoralising. The frustrating thing is that my hedged sells are more than €15k in profit, if only I could get 20k investment I could close them all and take the profit.

So in my despair I have been asking friends & family to borrow money, it really is my lowest point and I feel totally ashamed and embarrassed. When you get to this stage you know it’s time to stop, however I have so much invested in negative equity I can’t.

Thankfully I was able to obtain an extension on my business overdraft so have invested a further €10k taking my total investment to over €70k, crazy numbers. However this has now taken my FS to around 160 and I no longer have to worry about hedging, if only I could have got this last week grrrrrr. 

It’s amazing the difference it makes, on Friday I traded as per normal and made €400, I just need regular days like this and I’ll soon be out of this mess, however those kind of days are pretty rare these days 🙁

The key is small amounts, taking profit when you can, ‘break it down hourly Guy’ I keep telling myself. If I make €50 per hour 8 times per day, that’s almost €100k per year. I just need to do this for 12 months and I’ll be fine, however it’s very hard when running another business, but I will get there, I am determined to.

So that brings me up-to-date with where I am

I am now on a mission to get back the 32k that I have lost and to do this I have to break it down and keep a record, this is the only way possible. So I have a spreadsheet and a daily total I am aiming for, which is £500, which IF I can do, will take me 72 days to achieve. Of course I started this road to recovery chart before I made my latest fuck up which has hindered things somewhat!

I will keep you updated with my progress.

Final word of advice

If you have got this far, I really hope you will learn from this, it is not a full time job, it is at best a small sideline and something 99% of us will lose money on as that is how the market is programmed.

I personally think the market is totally rigged. You will see that the DAX 30 futures, US 500 NasDaq, even Apple, the graphs are almost identical – how on Earth can the top 30 companies in Germany have EXACTLY the same trading pattern as Apple? It is impossible, but they are identical.

Scalping is really not the way to trade, you need to use something like TradingView and learn how to predict patterns and open small trades trades for 2-3 days based on those graphs, setting Stop Losses and Take Profits.

There are all kinds of patterns that you should learn the basics of, rather than repeating you can read and learn a lot on Investopedia

Most people would be happy with an extra €2,000 per month additional income, that’s €100 per day,  just €12.50 once per hour! 

Don’t get greedy, take the profit when it’s there and very simply open a buy at the bottom of runs and sells at the very top and although you can go wrong following this theory you are far less likely to – so be patient and wait for the right time to open trades.

Good luck!

My essential Day Trading tips - albeit from a total novice!

So after 3 months of trading, not that I know much at all, but there are some things I can share that I hope you will learn from.

1. Only trade what you can afford to lose

Do not use credit cards, loans or borrowed money.

2. Start small

Just trade tiny amounts for the 3-6 months at least. In fact I’d go so far as to say that trading is a bit like the story of the hare and the turtle, which I can certainly compare this to myself and my girlfriend, we’re the perfect example:

After her terrifying experience at the beginning, she now only trades in very small amounts e.g. 2 or 3 Germans. I, on the other hand, used to trade in 10’s.

The great thing with trading big numbers is that you can earn a lot in a very short space of time, however the flip side of that is if it goes the wrong way you can be down a lot in no time.

If you have the FS to manage this, then it’s not an issue, after all you just need to look at the points and understand then 20-50 is not so much, however that’s €200-500, which is scary.

I basically shit myself every time I was -€500 – it’s a huge amount, and I closed the trade as I was scared to lose more.

However my girlfriend would have the same trade but much lower amount and would be -€100, so she’d just leave it and it would eventually turn and come into profit.

She takes the profit when it’s there, most the time small amounts and occasionally nice runs of €100-200+.

Which brings me onto point 3…

3. Take the profit when it’s there

Most the time you want to leave a trade open if it’s doing well, but the moment it turns and drops 5-10 points take the profit you have. Don’t wait and watch it go into the negative. You can always open a new trade.

4. Give yourself a daily target and stick to it – Do not get greedy

This is easier said than done and I wish I could listen to my own advice. There have been days where they have gone really well, but then I get greedy and they turn into bad days

5. Overcome the fear of loss

This is a big one and probably the hardest to deal with. Trading is like a drug, you want more and you don’t want to miss the next big high (or low). But remember; there will always be other opportunities, so don’t worry about missing a big run – most of the time you’d probably have opened the wrong trade anyway!

6. Don’t be scared to close losing trades

It’s a fact that not every trade you open will make a profit and the moment it starts tanking the opposite way don’t be afraid to close it, and if it’s really tanking open a trade in the direction it’s tanking.

7. Close trades overnight

For me this is probably the most important point. If you are trading something like the DAX which is open 20 hours a day, you should really close open trades when it closes at 9pm. Whether they are positive or negative I urge you to not keep anything open when you go to bed, I can’t stress this enough, because what will happen is that you will not be able to sleep and be constantly worrying about it to the point you’ll set your alarm to wake up when the market re-opens at 1am and then stay up all night, in fact as I write this, it’s 4am and I’m doing just that – babysitting bad trades that have got me into this fucking mess. 

For the sake of losing a couple of hundred quid it is not worth the torture of sleepless nights. So just to reiterate – DO NOT leave trades open over night unless you have very good financial strength 250-300+

Another added bonus is that you will not have to pay the very annoying swap few which can really add up.

8. Keep your margin level above 200% minimum

I have been trading in the red for months now and it is fucking stressful. Keep your Financial Strength above 200% don’t be tempted to open ‘a quick trade’ because they rarely are and they’ll get you into more trouble. As long as your FS is high then you do not need to stress.

9. Market Analysis

If you are using a platform like ForTrade take advantage of the advice your account manager gives you and their market analysis. Your account manager will send you regular opportunities and you should really take advantage of them.

10. Do not chase a loss

If you’re having a bad day, stop trading and just forget it. It will happen frequently, and when you start to feel desperate for a win you will do stupid things, so just stop, take a break and start again the next day.

11. Market volatility

Be careful when trading when the stock markets first open as it can be really volatile. Some people advise against trading altogether in the first 30 minutes, however I’ve had some of my best wins during this time, so actually quite enjoy it, but you have to be really careful. In the UK it opens at 9am and then the US market opens at 2.30pm.

12. How many open trades should you have?

I would highly recommend opening one trade per instrument. If you open lots on the same trade you will get into a huge mess, so just stick to one at a time.

13. When to open trades

Generally speaking only open a buy in the bottom 3rd of a run and open a sell in the top 3rd, anything after this and it really is not worth the hassle. Sure you might see the graph bombing up/down in a vertical line but don’t be fooled, it’s just to trick you into thinking it’s going to explode up/down, but this is rarely the case, just wait for it to come down and make the trade then.

14. Scalping

If you choose to start day trading and earning from short runs, then fine but make sure you are watching 100% of the time. As mentioned before, be happy with small wins, they all add up – as do small and big losses, which add up even quicker.

15. Long term investments

If you choose more long term investments then really speak to your Fortrade account manager for opportunities that best suit you, their research team analyses the market continuously – they may not always be right, however 6-7 out of 10 they will be.

16. Use Stop Losses

For Gods sake I can’t stress this enough especially if you are away from your computer / mobile. If I had set SL’s on the 7 open buys I had I would be out of this fucking mess, so make sure you use them – you have been warned!

17. Forums

I find the forums on Investing.com quite useful. Of course most the people on there will say things to affect their own trades, but you will learn that there are a handful of people who know their stuff and share invaluable information, so study and follow those guys.

18. SWAPS

Every working day a thing called a SWAP happens. I’m not really sure what it means but it’s the way for the market to charge you for any open trades you have. If you had a bad position open for a long time then these can really add up. So at some point you need to make a decision if it’s worth keeping those positions open.

19. BTFD

I kept seeing these 4 letters in all the forums so researched what it meant. It’s trading slang for ‘Buy The Fucking Dip’ in other words only open trades when it dips very low. Forget fucking around on trades between the lowest point and highest point. Just be patient, otherwise it’s just guess work, at least with dips it’s semi-non guess work! Never open a Buy trade at the top of a run and never open a sell trade at the bottom of a run. Remember these two points and you should be OK 70-80% of the time.

20. Patience

Not all the time, but a lot of the time if you open a trade and it goes the wrong way it will eventually turn and come back, this can take a few hours or a day, but I would say 90% of the time if I had just left the trades I closed instead of panicking and closing them I would have saved an absolute fucking fortune. This all comes down to the size of the trade you open. If they are small trades then fine it’s not an issue, but when they are large and negative figure goes into 4 digits or more its is pretty bloody scary. But it depends on how big your account balance is and what you can afford to lose.

21. Never open a trade on a vertical straight line

One of the things I have learnt, yet still get caught out with, is when you see a vertical straight line bombing up/down and temptation gets the better of you and you inevitably jump on thinking it’s going to continue like that all the way to the moon. Sadly this NEVER happens. 

What will happen is that you will open your trade, it will spike up up and then bomb the other direction, so considering the spread, you will then be left with a huge negative trade in a split second. I can’t tell you how fucking annoying that is. So just wait for it to calm down, and then open your trade. Many a Trading Tourettes moment has been had thanks to this little fucker.

22. Discipline

When I first started trading it was just a very cautious test to see what it was all about opening very small trades and testing the water. However, very shortly after starting it got to the stage where it started to take over my life, literally. I could not take my eyes off my computer, laptop, iPad or phone, I couldn’t leave it alone almost 24 hours per day, and as I write this I will yet again be waking up at 2am as I have open trades that I need to watch to make sure I prevent any disasters from happening, knowing full well that if i got a full night’s sleep, no doubt in the morning whatever fun & games had happened it wouldn’t be too far off from where they were the night before, but you never know what will happen and that is the drug I have become addicted to. 

So for the sake of your health, relationships, mental health, and sleep, I urge you to REALLY control every trade you make. Do not open a trade without a stop loss if you are going to be away from your computer. Do not leave trades open over night. Do not keep a losing trade open for too long – set a figure that you can close the trade at e.g £100. Never open trades at the peak of a run in the same direction. And most of all do not be greedy – this is the hardest thing to overcome. Remember 10 x £50 winning trades per day will make you 120k per year which for most people is enough! And when your budget has gone, that’s it, stop trading and continue with your day job.

Good luck and remember: BTFD!

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Abi Page
Abi Page
5 months ago

Guy I feel your pain! What an open and honest account of your day trading experience and thank you so much for the trading tips – I will certainly take note!
Please keep us up-to-date with how you’re getting on and I hope you can recover your money.

© 2020 – DayTradingExperience

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