We Really Screwed This Trade Up

We Really Screwed This Trade Up
This is a Guest Post by AK of Fallible
AK has been an analyst at long/short equity investment firms, global macro funds, and corporate economics departments. He co-founded Macro Ops and is the host of Fallible.


I talk a lot about using a trade journal to record your trades so you can analyze them later. Well today I wanted to share an example of our team actually doing that with our recent trade in Gaia, Inc. (GAIA). Full disclosure: we screwed this trade up. We mismanaged a great opportunity which caused us to make a lot less than we could have, and should have made. But that’s trading right? So in this video you’ll see what we did wrong and what you can learn from it.

You’ll see that finding a great company or trade, is just a very small part of the process. Your profits, or losses, come from actually managing that trade.

One of the biggest lessons we learned here was not to overtrade. If you spent that much time researching a company, and really had conviction in its fundamentals, then its against your best interest to trade in and out of it so much. The real money will come from sitting in that trend and milking it for all it’s worth.

After this GAIA trade, we adjusted our trade rules a bit. We loosened our criteria that would make us exit a trade so that we could hold our position longer in these names. We also decided to size these positions small to help make the the looser stops more bearable.

And as always, stay Fallible out there investors!

These new rules came in handy in future trades like with Yatra Online (YTRA). We had heavy conviction in this company but knew the ride higher would be wild. These new rules are helping us stay in it the position.

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***All content, opinions, and commentary by Fallible is intended for general information and educational purposes only, NOT INVESTMENT ADVICE.