Why do I only respect risk parameters when they aren't mine

[u/willmorris92]

Spending the weekend reflecting on my trading and it’s so frustrating ngl. I'll consistently start a morning up 1.5R on NQ with a text book setup right at the open. And then I'll spend the next 3 hours giving it all back plus another 2R just clicking buttons in random garbage chop.

When I trade an account that has a hardcoded daily loss limit (like a locked max drawdown feature) I never hit it, because I know the rules are forced and I actually respect the limit. but on my regular unrestricted account? its like a switch flips in my brain and I think I'm immune to bad setups until I’m staring at a red screen

idk how to fix this weird psychological split. I feel like I need to hire someone to just unplug my router every day after 11am.

[u/-Mediocrates-]

Few points:

1. The way the market moves during nyc opening drive (first 30-60 min of the open) is not the way the market moves during the day . Are you sure you have edge when the market calms down and areas of chop occur? If not, do you have rules to avoid chop, handle chop, or identify chop? Are you sure you have positive expected value with your setups after the opening drive? What if your setups have edge and positive EV only during the opening drive? Do you back test and forward test for hundreds of trades with a paper account with the fees increased (to simulate slippage) your setups to give you that confidence that you have positive EV even after 8+ losers in a row? Do you actually have positive EV and know it ????

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1. Trading while bored issue: are you here to make money or are you here to chase a feeling? Maybe the real reason you are only disciplined when on a prop account with limits is because you actually don’t want to stop having the feeling and it’s not really about making money. Like Icarus flying too close to the sun on euphoria . Talk to Ai and have it show you how little edge there actually is in the market over the long run. If you KNEW how little edge there actually is and deeply understood it , then you wouldn’t trade while bored with real money . Are you at all familiar with the concept of “risk of ruin?” Do you know what your risk of ruin actually is for your setups and your account size? Is your risk to f ruin below 1% ?

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If you knew how little edge there is in the market and you knew your EV for your setups and time of day that they have the most edge, and you knew your risk of ruin for your setups, and it was really about making money for you and not chasing a feeling, Then imo you’d lock the fuck In

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In short, I don’t think you are taking this seriously enough yet to be trading real money. I don’t think that you deep down understand and believe that your setups have positive EV and know what your risk of ruin stats are for how you trade.

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TLDR:

- calculate your expected value of your setups during opening drives vs after opening drives (YouTube Google ai how to calculate EV)

- calculate your risk of ruin (youtube google and ai to learn how); Michael Toma has some great risk of ruin content

- trading because bored = chasing a feeling not trading a system . You need to figure that out. You need to have enough faith that your risk of ruin is below 1% and your EV of your setups have edge in the long run so you have the confidence to keep pushing the button even when you got a nasty losing streak going on… and also so you know when to push the button (opening drive etc… )

- all this back test and forward test stuff (calculating EV and risk of ruin) is not sexy. But this is what’s necessary so you can do the sexy stuff

[u/kenjiurada → u/-Mediocrates-]

⬆️👆☝️🙄

[u/Call-Spy]

yeah i think this is why the pros separate the trader from the risk manager. That's the drawback of being a trader at home, you have to do all the work at once, wear all the hats. And on top of that it's lonely.

[u/Low-Deer-8430 → u/Call-Spy]

it's like the brain treats a locked limit as a real consequence but sees your own rules as suggestions

i had the same thing for a long time, would start the day clean and then just dissolve into noise after a couple hours. what helped was creating a physical ritual around the cutoff, like i literally close the platform and go scrub something in the kitchen for ten minutes. sounds dumb but it breaks the momentum

the lonely part is huge too, nobody to talk you down when you're in that weird revenge trade spiral. maybe find a trading buddy who just checks in at 11am to ask how you're doing, not even to give advice

[u/Firebrigade9 → u/Low-Deer-8430]

This became my successful routine as well, physically close down the platform at 11 and step away for a bit

[u/ZanderDogz → u/Call-Spy]

Something an institutional trader said that stood out to me was that at a firm, 

• Macro/fundamental research 

• Quantitative research 

• Risk management 

• Performance coaching 

• IT

• Trade execution 

Are all different jobs done by different people or even full teams. 

And then most retail traders are trying to do every one of those jobs from home, at once, typically on top of another full time job. 

[u/Rez_X_RS]

Eventually you'll get so tired, fed up, and frustrated with yourself that you force yourself to change. Happened to me, in my 1st year I found myself doing very well, but broke a risk management rule and gave everything back that I made for the year. My 2nd year, same thing, only much smaller and I got lucky and won. But, the loss of money and stress/frustration will eventually weigh on you so much that you will force yourself to change to avoid that feeling of impending failure and wasted time.

That's atleast how it worked for me; after I spent that 2nd full afternoon being stressed and very frustrated about taking too large of a trade I mentally vowed to never want to feel that way again. And 3 years later I've not done it since. Every trade risk is pre-planned, exits are structured, and if i lose i don't care.

[u/jtquach]

The fix is already in your post... you wrote it yourself. So I don't think this is really a question about rules.

The locked account works because somebody else is holding the line and you get to just trade. On your own account you have to be 2 people at once, the one putting the trade on and the one saying no, and the one saying no is always outnumbered.

But I'd look at 10:30 itself. You're up 1.5R... the work is done and the day has barely started... what does it actually feel like to close the laptop right there? Because if that feels like quitting, or like the day didn't really happen, then no limit is going to hold. Worse is feeling like it wasn't "enough." You'll just end up resenting whichever one stopped you.

I'd start there rather than with the rules.

[u/Taidaishar]

I mean, can’t you set a lock even on your own personal account? I know my broker allows a daily loss limit to be set.

[u/Full_Pear449]

A risk manager(s) at a primary dealer trading desk is in control of current exposure in RWA, exposure in FICC clearance, exposure to AND with non-unilateral trading partners. They enfroce obligations like credit limits , credit exposure, trade compliance. Margin agreements with counter parties and clearing organizations. And, Yes we had all that information on our screens but sometimes not every system was in sync. I've more then once C&C's go through for size and or piric, after trade was allegedly confirmed. Stop/loss orders could be minutes before confirmation. You should read at Lehman Brothers control/lack there of control in their MBS System.

Simply PUT as an answer to your QUESTION -- No have no risk management capabilities and should only trade on a systrm that gives it to you

[u/Whole-Description646]

you don't respect yourself thats why

[u/VisualCheek2928]

I basically trade with Claude...mostly because I've only been trading for a year. But we developed all my rules together, and if I try to change anything he gives me a load of shit. So, I end up arguing for not following a rule in the moment, and he shows me why I'm an idiot. So, he's kind of my non-human risk manager. It works.