So, yesterday I was in the markets as normal, pre-race and in-running. It was a strange day pre-race, moves looked likely but never really materialised. Patience is key, as you know, sitting and waiting for the opportunities to present themselves is a large part of the game. This patience was eventually rewarded with two large moves, one an absolute stonker from 3.95 - 6.4, in the bumper.
Knowing the later AW markets are not as solid as the afternoon cards, I carried on trading at Chelmsford City. Started off with a solid green then, not only did I make a poor entry, a long way from where a safe exit would have been possible, I got trigger happy with the entry too, making multiple entries. Of course, the position reversed massively leaving me with a £100+ red. This was more than a schoolboy error, this was discipline disappeared, forgotten, lost. Why am I so damning at this foolish act? Because I did it again in the next race. Not to the same size red but, this time, I went past tilt and massively increased my liabilities when trading in the run - the classic increase in stakes.
The in-running trade resulted in a scratch overall, though it's debatable if that's a good thing...
Almost 10 years I've been trading, 6 of them full time, and still I'm prone to such ridiculous errors.
After taking time out and clearing my head overnight, the analysis. We ask ourselves so many questions when we do this and the answer is always the same "I didn't stick to the plan". The plan is so simple, there are just a few qualifying aspects to take into account. What's worse is on Monday this week, to get a refresher, I re-attended Steve Howe's excellent Racing Workshop, where the plan was drummed into me over and over. A plan that works exceptionally well - when implemented effectively. After telling Steve about my stupidity I requested his wisdom;
"Knowing when enough is enough is something we all struggle with. When it comes to trading there HAS to be a line.
Having an exit plan, and implementing it is as important as your entry, if not more so. I have an exit plan built into my entry position and if that exit point is reached it’s game over. I close the trade and reassess my position. Not to chase any loss, but as a completely different trade. This takes a few key skills; discipline, confidence, practice.
The less experienced you are the less flexible you should be. Experience enables me to see a bigger picture, so occasionally I let my planned exit lapse. I will need to see the reasons for this. A good example would be; I have a Back bet on a favourite, it’s drifted to the point of my planned exit (or Stop Loss position). There is no strong opposition and the favourite looks to be at the front of the line-up. Armed with this information, I make a judgement that the drift is temporary and the odds have a better than average chance of coming back. If I can see the reason for the drift, maybe the 2nd fav that was drifting has reversed and is now opposing the favourite, the a swift exit is called for.
The absolute Golden Rule for any trading is “Protect your bank”. If you don’t lose then you win by default."
Steve's reference to a lack of experience is relevant here. Though my experience of trading the exchanges is lengthy, my experience with pre-race is relatively short. Though you'd be forgiven for suggesting I should still know better.
The day ended with a profit overall but there were times when my liabilities were far too high and the trading was woeful.
It's back to basics for me with pre-race and much-reduced stakes until the errors are equally reduced.
NB: Steve's Racing Workshops are the best pre-race training available. I can say that with impunity because I've done them all, sometimes twice, and it's only Steve's that have ensured consistent profit. http://www.itsamugsblog.co.uk/2016-racing-workshops/