You should have a plan for when you screw things up because I can guarantee it will happen. This is the screw up I did last night and how I handled it this morning. Enjoy this unplanned post.
The Nightly Ritual
Each night for 250 days of the year, I do the following for my trading.
Step 1: In the early evening, log into InteractiveBrokers, get the executions for the day, update my current positions and P&L spreadsheet. This is all done with a push of a couple of buttons. Last, push button in Excel that starts code that waits for data to be updated for the day and then runs my scans in AmiBroker and imports results into Excel. Time to do 2 minutes
Step 2: Walk away from computer for a couple of hours while it waits for data update and AmiBroker to run my scans.
Step 3: Review new trades to make sure nothing looks odd, push button to create basket file for orders, place the orders in InteravtiveBrokers. Time to do 2 minutes.
Step 4: Before going to sleep, try and remember if went down to my office that evening. If I can’t remember going down, then make sure orders were placed.
For 248 days of the year this works just great. But last night was a different night then normal. I had done steps 1 & 2. I then went to a birthday party. Then after that I had to get my son at a school event. When we got home, my son and I had to do something on my computer. Now this is the time I would have normally done step 3. But I did not because we had to then go up to his computer. Whoops, the start of the mistake. Then when I went to sleep, I thought yeah I had been down to the office so all was good.
On most days, I am in my office before the market opens. But of course, not today. Today, I get in 30 minutes after the market opens and then I see my spreadsheet open on my computer. First thought is “OH SHIT!” I forgot to place the orders. I log into IB and verify that the orders had not been placed.
When this happens, my plan is to place all the orders. Now this is the key point of my plan for me. I simply place market orders. I do not try and play games by trying split the bid-ask price or anything else. I have learned from experience that trying to suddenly become a day trading, I will make things worse.
One thiing I do when a mistake happens is what can I do to prevent it happening in the future. Right now each night at 6:30 I have a simple program run that brings up a dialog to remind me to place the trades. Because of this mistake, I have added code to the program. Now if the dialog is still up at 9pm, it sends me an email/text to remind me to place my trades.
Does it suck making these stupid mistakes. Yes, it does. I have a process in place to minimize them. This mistake only happens once or twice a year and I know exactly what to do when it happens. I get mad briefly, take a breath and then execute my orders. Am I still mad? No. I more amused and thinking what can I do to make this less likely to happen. And if happens again, I have my plan to deal with my mistake. What is yours?
Good quant trading,