Trading Stories: The trading strategy that cost me 200k

It was early September 2018 in Mayfair, London, where we had just moved our Hedge Fund. The office was a mess, full of boxes and scattered items. Fresh start in a very cool place, wealthy neighbourhood, I was feeling invincible. After some technical analysis, I decided to leverage short Nasdaq at 7650. The next day, the market started falling, and I was pumped, thinking I was about to hit the jackpot. Everything felt right, like this would be the trade of my life.

The market dropped quickly. At 7310, I doubled down on my short position, and it kept plummeting. It broke 7000 and continued its descent. By early October, it hit 6900. I set my stop loss at the entry level of 7310 mark. Then, the market reversed, wiping out my gains and hitting my stop loss before plunging again. I was furious, convinced the market was out to get me.

In my frustration, I shorted again at 6800 and 6600, certain it would collapse. But no, it double-bottomed and surged to 7100. I didn’t set a stop loss this time to avoid another whipsaw. I lost sleep for weeks. When it passed 6950, I was bleeding money like Niagara Falls, so I panicked and closed my positions above 7050, losing about 20k.

Then, the market dropped like a rock. I didn’t add new shorts except my original at 7650. I closed that position at 6000, making about 45k. It fell to 5900, which would’ve netted me around 200k if I’d held on all my positions.

Sure, I made some money, but the missed opportunity cost drives me crazier than the actual losses.