The Question

So the walls are closing in… total portfolio is down over another 10% today… the pain just keeps mounting.  Total drawdown now approaches 30%, I think… it’s been two weeks.  In times like this, I often comfort myself with the old Persian lament:  “This too shall pass.”

At this point I’m essentially stuck in a long-term hold.  It’s basically become a game of chicken… which will happen first?  Will the market rebound?  Or will I get margin-called?  That is the question.  On a lighter note, one unexpected upside is the sudden time and energy that not day-trading has suddenly freed up!  Since I’m no longer actively day-trading every morning, I’ve been able to focus more on what Cal Newport calls, “deep work.” I’ve been using some of this extra freed time to study historical bear markets and their circumstances. In particular, WP wrote a fascinating postmortem of the 2018 December downturn.

For me, this has particularly meant concentrating on the day-trading bot.  I spent most of this past weekend scraping indices pricing and volume data for DIA, SPY, and QQQ from the past three years.  I have the data at minute granularity but now the challenge is just properly wrangling it before putting it into the db.  (Eg. Some fields are ‘NaN’ and I’ve been having to manually fix those data integrity errors.)

Additionally,  it also means I’ve been able to spend more time focusing on writing.  I’m still aiming to write a post a day to post on this blog… we’ll see if I can keep it up!  As I’ve mentioned elsewhere, I often don’t know how I feel about something until I properly sit down and put my thoughts into written words.  So as we enter the third week of the correction (soon to be a bear market if we sink just a little further!) I’ve had a lot of time to just sit on my hands and think.

One other revelation that struck me recently is how similar day-trading and investing is to religion.  As I sit here in my leveraged account and contemplate existential questions, watching my balance drop day after day, I look back at previous price action and it reminds me a lot of the bible.  The Great Head Fake of December of 2018 when Abraham’s faith was severely tested.  The parting of the Red Sea when Tesla shot up to $969 per share, wrecking Tesla shorts on one side and David Einhorn on the other.  Just like the bible, we’ve got our share of prophets too– some bona fide; some false.  Cramer, Ackman, Dalio, Simmons, etc.  The list goes on and on.