I am currently reading the Jim Simons book, “The Man Who Solved the Markets”. It’s very good, I suggest you check it out.
There’s this throwaway line in there that stuck with me.
“On Wall Street, traders often are most miserable after terrific years, not terrible ones, as resentments emerge—yes, I made a ton, but someone wholly undeserving got more!”
Let me give you some context. I had a not-so-great 2019. I was marginally profitable but miserable. I kept thinking about quitting and telling everyone I know about it kinda like how people want to everyone to know they’re quitting Facebook. It was more an expression of my exasperation than an actual serious consideration. Trading sucks. It stopped being fulfilling a long time ago. That young kid in his 20s who was the first to show up to work wasn’t there any more.
I had dinner with an old trading mentor in December to talk freely about my future. Eventually the conversation spilled over into me having left prop trading many years ago. I get the sense he thinks I’ve underachieved. He referenced a few colleagues who were at my experience level, that were making huge numbers, and he said he never knew anyone who left and made more. He said I was just as talented as they were. Maybe he’s right but it depressed me further to hear that. In the end, I decided to press on. I had to keep trading and just do better. I had the freedom and financial means to do anything else but there just wasn’t this deeply inhibited life long dream to pursue, like starting my own restaurant or writing a screen play. I didn’t have other skills. The road led back to markets.
Skip forward to 2020. I refocused myself and am now having a record personal year and we’re only halfway through. But I kept feeling this nagging sense that “everyone else” is doing better. Whether it’s just a hot market after covid-induced volatility or whether it’s all the new stay-at-home retail money flooding the market, it just seemed like anyone can make money. I couldn’t feel any pride in my work. I’m making the same levels of PnL I made 3-4 years ago on my best trades, it just happens more frequently. Maybe that’s a sign of stagnant growth the past several years—and I’m criticizing myself for it like it’s this indictment on my overall self-worth and character. Every day is a challenge to put the blinders on and try to trade with minimum levels of toxicity and hyper-negative self talk. Just do the best I can, pay the bills. Not much passion. Whatever.
Last week I had a “social interaction”, and I can’t elaborate more than that, that all but confirmed my worst insecurities. It shook me to my core. My so-called “best year ever” is nothing. It’s chump change. I felt small, resentful, and pathetic.
I try to be ignorant of others’ PnL. Unfortunately this “social interaction” occurred unintentionally. I hate thinking about money and letting it dominate my thoughts. The meta thought here–maybe I should “let myself” be motivated by money. Maybe the best ones are motivated by seeing that big green number get bigger and greener. It’s not like I can pretend I am this virtuous being by not caring—it’s not as if I am spending my spare time rescuing kittens and donating my money to orphanages. Maybe I just resist because I’m not good enough to play the bigger game—and it’s just that painful to think about it.
That evening, I started writing down all these goals to trade more size and reach these arbitrary PnL goals by years end, 2 years, and 5 years. All the emotions I had tried to bottle up since my soft reboot in January, they spilled over like the Exxon Valdez. I’m going to use this anger as motivation, I told myself. I’m going to make myself uncomfortable. I’m going to dare to dream. I’m going to… blah blah blah, you know what I’m talking about.
So predictably, I traded like a total asshole for the next two days. I pushed more size and tried to prove a point. I snapped a 16 day win streak and tallied one of my worst red days of the year. My only dominant thought was “how can I have x amount of size” on this trade, little else. I had zero feel for the market and let most of my positions hit their max pain point. To my credit, Friday I did better and achieved a green day that would be top-5 for me in 2020. To give myself a fair grade outside of PnL though, it was a mixed bag. The day was a calamity of emotion and errors but the trade I was most heavy on, I was on the correct side (which can cure all ills).
On that day (the “good” one), I actually broke down into full meltdown. I had caught a good move on the insane-O size I was gunning for but the fast move missed most of my bids to cover by just a small margin and I saw my PnL levels quickly evaporating as the stock reverted back to my entry (in retrospect, a very normal pullback that just triggered me at the wrong time, as the stock would later continue in its trend). I screamed as loud as I could at the top of my lungs, slammed my desk, and chucked an array of small objects at the wall. I acted like a child, not getting what he wanted right away and thereby throwing a tantrum about it.
My wife rushed over to ask what’s wrong and tried to console me. In that moment, it was impossible to put my feelings into audible words. I just felt numb and empty, ready to topple over and collapse. You win, world. When the day ended, I was very profitable but I felt zero sense of achievement or inner character. I had enough of myself and the toxicity and the feeling that I am just this puppet to the gods of money who are demanding that I make as much money as possible otherwise I’m a piece of shit.
As I reflect on my behavior and my mindset, I see what had happened. I had created this fork in the road where there’s no winning in either scenario—either I go back to trading normal size and label myself as mediocre, or I continue to push for the wrong reasons and stay in a mental space of maximum volatility. How can you win playing this game?
The week after (this current week), I experienced a bit of an emotional hangover. I stopped looking at the note cards where I had scribbled down all this huffy-puffy nonsense about achieving my dreams and trading bigger size. They didn’t push me anymore. The anger was gone. Whatever grievances I had from said “social interaction”, they just stopped mattering—I guess that’s the stage of acceptance. I just traded like normal. The results were good. They were fine. I still didn’t feel much joy from trading but I didn’t feel like total shit either.
I’m not sure what the lesson is. Thanks for reading.
Ok I shouldn’t end the post there. That’s too bleak. I have started some reading about transcendent experiences and how they can lead to true change. You can find it in monetary achievements but you can also find it connecting with people, connecting with nature, or finding growth in purely intellectual pursuits like philosophy. I’m not sure what the answer is or where I should go next. The next step in trading, if I ever get there (or even want to) isn’t going to come from the ego and false inspirations. I have to really dig into how I felt connected to the pursuit of solving markets earlier in my career and find out what exactly gave me joy. If I can’t find it again, then trading is just a job and that’s that. Thanks for reading.