FEAR - Like a deer in the headlights

It has been some time since I have experienced the kind of fear I am currently experiencing in the market.

Once again I am in a weak position as I trade away from my proven method of success and adopt what has proven to be my trading downfall, i.e. LARGE directional bets. These trades are to a large extent ego trades and are not good for me, my trading results and that is that.

I have no problem entering these types of trades on a small basis as they can bring the extra cream we all look for but they cannot be the primary source of my profits.

Lets briefly examine the positions.

The 1st one is an directional put option on the US real estate market. This index continues to make new highs and confuse the best known pundits, so I am in excellent company. The problem is I have had so many hassles with opening a new more efficient account that to a large extent I have traded this account poorly from a being on top of perspective. The details are boring so I won't go into it, once again I am too big relative to my mandate and have chosen to bury my head in the sand to a large extent.

The 2nd one is a call on the selloff of the SA Alsi 40, which like my 1st point has gone against my call and instead of trading it on a shorter basis I have allowed the greed of early success to grow my position into a size I am not comfortable with.

I have decided to trade both positions on a short term basis for now, as both trades seem pretty clear in the short term. My intention is to use hopefully success on the short term side to shrink my position size to a manageable level.

In the even of my short term trades working against me, I need to then look f0r the earliest opportunity to cut the trades.

I don't like being afraid, so let this serve as a warning for other times into the future. Being "nervous" is part of the job and is not the same as being afraid.

Time to be super vigilant, and on top of things.

Mike