How I Lost Over $500,000 In ONE TRADE

So this year, I lost a little over $500,000 on one single trade. But there's a few things that I want to share with you guys so you guys can actually learn from my mistakes and not make the same mistakes and grow for them. Now, what actually happened was I took a major position shorting the market around March. Obviously, this position, as you guys know, market rallied afterwards. This position did not work out in my favor, and I took it close to 500,000 plus losses on my year to date, profit and loss. Now, what happened here, let's kind of walk into it and break it all down. Starting the year off, I had a very good first month. And second month, January, I made a little over $50,000. And then in February, I had a very, very big month. I made a little over a million dollars just from trading. Now, so far, starting the year off, I was like, hey, I'm gonna have a phenomenal year. I think this year if I keep trading the way I'm trading, I can probably make five, maybe $10 million just from trading if I keep it up. Now, when the market dumped in March, I took a position shorting SPY. I bought, put options for January of 2021, September of 2021, around 180, 160, $200 strike prices. And I was like, you know what? I think the market's gonna go down further. So I started buying in and obviously not going in full. 500,000. Right off the bat, I was scaling positions 100 grand, 150. 100 grand, 50,000, 100,000. And that built up to 500 grand. Now, when that happened at one particular point, I was up on my position. And then what happened afterwards is when the market started flattening out and started picking up, my premium started slowly taking a hit. Now, what I want to share with you guys, I want to share what I've learned from this major mistake I've made. Now, the first thing I've learned is, number one, the market is always right. Now, when I was wrong on my position, or when the market looked like it was flat or I wasn't sure at a particular point, I wasn't down 500 grand. I was probably down 120, 140,000. Now, what I should have done at that particular moment is cut my losses or taken the position off. Instead, what I did was I held. And I was like, you know what? My thesis is right. There's no way this market is going to pick up. When I look at all the facts of how this economy is actually Being affected by coronavirus, I think the market is going to continuously dump. So I obviously didn't watch price action and I tried to fight against the Feds. So me going against the Feds, what that actually did, that dug me into a deeper hole. Now, if you guys are aware, the Feds were printing unlimited amount of money and they said, hey, we are going to support the economy as much as possible. Now, when that happened, they provided a lot of liquidity into the market, which pumped the markets up to insane valuations, which they are at now overlooking that I stuck to my trade. And this is where I got in my head and I said, no, I have to stay in. It's going to dump. I don't want to miss out on this play. There's no way I can miss out on this play. I got to keep it. I got to stay in this position and ride it out. Now, after some time, my position started getting sliced in half. Now I'm down 250. Now I'm down 300. Now, there were times where I started offloading some of my position. But the second thing I've kind of learned from this, besides the market is always right and, you know, don't fight the Feds is always know your position size. Now, obviously, when I put in 500k, I understood that if I'm wrong, I will lose 500,000. But I didn't really think, honestly that, hey, I would be wrong. Now, the one thing that I kind of did good here is I risked my trading profits because at this point, I was up about $1.1 million for the year up until February. So I risked about 50%, 40% of my profits, which isn't the worst, but I do think I could have went about a lot better. Now, this had a huge psychological toll on. After I made a bad trade with SPY and shorting the market, I made a bunch more bad trades. Following me, trying to short Zillow. I tried to short Zillow. I was like, oh, the housing market is going to take a hit. Why did that happen? Because I was so fogged up by that one trade, I was trying to overlook that and say, you know what, I have to find another play. I have to find something that's going to dump something that's going to take a hit. The housing market is going to take a hit. So I had no solid reasoning. But that's where emotions kind of clouded my judgment and I took small position in Zillow and. And that kind of hit me hard. Second thing I did wrong is I took on another position in Tesla and you know, obviously going back to these trades and when I look at them, I was like, hey, none of these trades actually made sense. So they came from my psychological standpoint, oh, hey, the market's gonna dump, Zillow's gonna dump, Tesla's gonna dump. That kind of threw me off my mojo. And once I was thrown off, I was just all over the place where I wasn't able to find consistency. Now since I wasn't able to find consistency, that made it very, very hard for my P and L for that account to actually pick up. So for about two months I wasn't making any money from trad. Down, up, down, up, down. So now at that particular point I'm like, you know what, I need to take a hard reset because obviously losing half a million dollars is a lot of money. And like I mentioned, it was great that it was part of my profits, but it still hurts because, you know, psychologically as traders, that's a large amount of money. So I was like, you know what? I need a hard reset. I'm unable to get into my flow, I'm unable to get into the consistency aspect. I'm unable to size up and take the same amount of trades that I was taking before, so I need to do a hard reset. So a few things that I did was I took some time off from trading. I took about a few weeks off. When I took a few weeks off, that kind of cleared my mind and it allowed me to re look at the markets from a different perspective because like I said, I was so heavy on shorting the markets. I was so heavy on that the market's going to keep dumping and make a new low and I'm going to be the one who catches it. Now when I took that break, that break was so well needed because for those few weeks I kind of completely separated myself from trading. Kind of took a complete step back. Didn't look at charts, didn't look at news, didn't look at anything. Just kind of stayed to myself and looked into different stuff like psychology books, going to different topics and subjects. When I did that, that kind of allowed me to re clear my mind and regain confidence. Now, once that happened, I slowly got back into the market and then I started trading with smaller size. Now, one mistake a lot of people make is when they take a big hit, they go back trying to recoup that loss, right? So yes, obviously I wish I could recoup that loss in the first week or second week, but I was like you know what, I have to go back, trade the way I trade, and take it from there one step at a time. So now recouping that was out of my head and the only focus was to get back to being consistent. It's not about making X amount of money, was just being right or being in a good trade. So for the next few weeks I just focused on getting back into my flow, getting back into my routine, finding consistency and just focusing on my trading and trying to get myself out of that mental hole that I made. Because remember, at this point I'm still up for the year. I'm up about 800k, so I'm still green, which is keeping me alive. But mentally it's still messing with me because I took a big hit. So now once I started getting into my flow again, I'll make $500 a day, $1,000 a day, a few hundred dollars a day. And you know, psychologically, once again, for, for a trader that has, you know, had days or even six figure days, it's like, whoa, this is extremely hard, no, Being able to take a step back and make 500 and make a thousand, right? So I'm like, you know what, I have to stay disciplined, I have to stay focused, and I have to look at this from a long run aspect. I'm still alive, my head is still above water, right? The loss sucks. But now I just need to maintain myself and find that mojo, find that consistency. Because when I do, I'll be able to elevate my trading to the next level. Now, once I started building consistency, my consistency started kicking in. Around June, I started taking some swing positions, I bought spike calls, I rode the market on the uptrend, I bought other plays. That kind of helped my P and L get alive again. And once my P L started, you know, building up again, I started building the cushion. Now I'm currently up about 1.4 to 1.5 million for the year, which is a lot better than where I was at 800k a few months ago. And this just kind of shows you that when you're going through a bad trade or bad month or any sort of mess up that you have in the market, you have to learn how to get yourself out of it. Because I could have been caught in a situation where after I took a big hit, I could have dug that hole a lot deeper and I could have made my P and L go to red. I could have gave away more money instead of even losing that 800k that I was up for the year. I could have gave that and more away if I didn't take that step back. But taking that step back, clearing my mind, helped me out a lot. Being able to see the whole market from a larger perspective and that larger perspective was okay. I think the market's going to go down because X, Y and Z doesn't make sense. But at the end of the day, like, you can't, you just can't fight the market. So I, I don't know, I can be so wrong in this. So instead of me being on that flip side, let's look at all the reasons the market's going to go up and let's understand trading and let's ignore all the outcome side noise and just trade the charts. So I think that kind of helped. And like I said, the whole idea of this video was just to showcase you guys. If you took a big loss, we took a big hit on your trading count this year, this month, this day, this week, whatever. Just understand that taking that step back and, and reanalyzing everything and understanding where you messed up and what you could improve will do wonders for you. Thank you so much for watching, guys. If you guys have any questions, please let me know. Also comment down below and how your year has been for trading this year. If you guys want to see my piano, I posted it on my Instagram. I'm also going to do my a recap on my P and L the year. Like I mentioned, I'm up a little over 1.4 million for the year. I'll do a recap on how, like what I traded, how I'm trading and all that, just to kind of give you guys a different perspective. But I have that video up on my Instagram right now. Go check it out and if you have questions, comment down below. I will be replying to comments. Thank you so much for watching, guys.