{"id":51589,"date":"2022-06-08T05:00:01","date_gmt":"2022-06-08T09:00:01","guid":{"rendered":"https:\/\/www.smbtraining.com\/blog\/?p=51589"},"modified":"2023-06-08T10:00:43","modified_gmt":"2023-06-08T14:00:43","slug":"10-key-takeaways-from-may-trading-from-the-prop-desk","status":"publish","type":"post","link":"https:\/\/www.smbtraining.com\/blog\/10-key-takeaways-from-may-trading-from-the-prop-desk","title":{"rendered":"May Trading Insights: 10 Key Takeaways from Our Prop Desk"},"content":{"rendered":"<p>Each month our traders meet for a monthly review with their Team.\u00a0 Our floor manager, @TheOneLanceB, our head of trader development- @SMBRecruiting, and I attend and provide mentorship during these meetings, which are run by the Team leader.\u00a0 <a href=\"http:\/\/traderfeed.blogspot.com\/\">Dr. Steenbarger<\/a> provides invaluable feedback to traders on their monthly review, as well.\u00a0 Each trader shares their key takeaways from the prior month.<\/p>\n<p>Here are ten key takeaways from May trading from our prop desk at SMB Capital&#8230;<\/p>\n<p><strong>1. The essence of trading<\/strong><\/p>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-large wp-image-51590\" src=\"https:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2022\/06\/two-ideas-1024x379.jpg\" alt=\"\" width=\"846\" height=\"313\" srcset=\"\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2022\/06\/two-ideas-1024x379.jpg 1024w, \/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2022\/06\/two-ideas-300x111.jpg 300w, \/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2022\/06\/two-ideas-768x284.jpg 768w, \/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2022\/06\/two-ideas-610x226.jpg 610w, \/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2022\/06\/two-ideas-100x37.jpg 100w, \/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2022\/06\/two-ideas-846x313.jpg 846w, \/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2022\/06\/two-ideas.jpg 1092w\" sizes=\"auto, (max-width: 846px) 100vw, 846px\" \/><\/p>\n<p>&nbsp;<\/p>\n<p><strong>2. Fewer trades, more size.\u00a0<\/strong><\/p>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-51591\" src=\"https:\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2022\/06\/shark-trade-less.jpg\" alt=\"\" width=\"674\" height=\"819\" srcset=\"\/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2022\/06\/shark-trade-less.jpg 674w, \/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2022\/06\/shark-trade-less-247x300.jpg 247w, \/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2022\/06\/shark-trade-less-610x741.jpg 610w, \/\/www.smbtraining.com\/blog\/wp-content\/uploads\/2022\/06\/shark-trade-less-100x122.jpg 100w\" sizes=\"auto, (max-width: 674px) 100vw, 674px\" \/><\/p>\n<p><strong>3. Strive to be Your Best Trader and NOT #1 at the firm.<\/strong><\/p>\n<p>One star trader at the firm recently inquired as to whether he was #1 for the month in PnL.\u00a0 During our monthly review with his team, I jumped in to start a discussion on this topic.<\/p>\n<p>I asked: Is it better to push to be #1 at the firm or Your Best Trader?<\/p>\n<p>@TheOneLanceB, #1 trader at a tier 1 prop firm the past two years, counseled that is was healthiest to work to be Your Best Trader.\u00a0 He noted a recent tweet from the Dalai Lama that messaged: competitiveness and comparison can be positive when used to push yourself to be better.\u00a0 And Lance shared that in his career comparing himself to other traders caused disappointment and distress when he was not doing as well as others.\u00a0 Lance mentored that you are not longer playing the game for fun if you are looking over your shoulder measuring your performance against another&#8217;s.<\/p>\n<p>I asked for Shark&#8217;s thoughts on this topic as he is perhaps the most competitive person at the firm.\u00a0 And I know he has had a goal in the past to be #1 at the firm.\u00a0 He counseled, &#8220;I want to compete with myself.&#8221; And for a trader to get competitive in the best opportunities to most improve.\u00a0 Shark recommended a focus on trying to be better and better each day.<\/p>\n<p>Lance challenged traders to focus on whether they did their absolute best in the biggest trading opportunities.\u00a0 Ask yourself after each of these biggest trading opportunities:<\/p>\n<p>Did I feel appropriately uncomfortable in this trade?<\/p>\n<p>Did I push myself a little more than I would have otherwise?<\/p>\n<p><strong>4. Watch tape to become a better trader.\u00a0<\/strong><\/p>\n<p>A few developing traders set a goal to watch more tape this month to improve their trading.\u00a0 I suggested they watch the video <a href=\"http:\/\/The Highlight Reel\">The Highlight Reel<\/a> by @TheOneLanceB for an effective and efficient way he watches tape to improve his trading.<\/p>\n<p>Lance challenge: What if you shared your Highlight Reel with other traders on your team (or trading group) and created a database of trades?<\/p>\n<p><strong>5. Joint accounts need to be tweaked just like trades.<\/strong><\/p>\n<p>Some of the best trading we are doing at our firm is with joint accounts but&#8230;<\/p>\n<p>We are learning that joint accounts, accounts you trade with another trader together at the firm, need to be tweaked and adjusted just like your trades and trading.\u00a0 We have seen some joint accounts add additional traders to their joint accounts for better performance.\u00a0 We have seen some joint accounts substract traders or strategies for improved performance.\u00a0 Joint accounts may need to eliminate traders where you ALL do not agree on risk or the risk amount.\u00a0 This is all part of the joint account trading process that needs to be continually managed.<\/p>\n<p><strong>6. Top traders jumped on the same call during the highest opportunity day.<\/strong><\/p>\n<p>Top traders created a special new call on the day of the big bounce- 5\/12.\u00a0 They sensed the unusual opportunity.\u00a0 They jumped on a new private call and shared their thoughts in real-time during this huge day.\u00a0 Normally they just chat with traders on their team and not necessarily with other top traders in real-time.\u00a0 Top traders learning other top traders were seeing the bounce, like they were, gave them even more confidence to add size and hold.\u00a0 This is an excellent best practice for the biggest trading opportunities.<\/p>\n<p>How can you make more with the biggest trading opportunities?<\/p>\n<p><strong>7. 90 percent of the PnL came from the 5\/12 Bounce Trade so&#8230;<\/strong><\/p>\n<p>A top trader at the firm, after reviewing his trading performance, noted, &#8220;<span style=\"font-weight: 400;\">90 percent of my PnL came from 5\/12 Bounce trade.&#8221;\u00a0 I asked this elite trader: Could you have bought a basket of stocks when you determined the market would bounce, so you would have made more?\u00a0 Traders on the Team discussed whether they could create a joint account utilizing options for special opportunities, when they spot the turn for a big opportunity.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">How can you make more in your best trading?\u00a0\u00a0<\/span><\/p>\n<p><strong>8. It&#8217;s the drilling down on our trading performance that gives us answers.<\/strong><\/p>\n<p>After Dr. Steenbarger reviewed the monthly review of a firm trader, he mentored:<\/p>\n<blockquote><p><span style=\"font-weight: 400;\">\u00a0I think you&#8217;re doing a great job of separating out *what* you are trading (where the edge lies) and *how* you are taking advantage of that edge (execution).\u00a0 Breaking down your playbook in terms of performance and then drilling down on what&#8217;s working and what&#8217;s not will provide you with the deliberate practice to get better and better at taking advantage of your edge.\u00a0 <strong>It&#8217;s the drilling down, trade by trade, trade category by trade category, that tells us what to do more of and what to pull back on.<\/strong>\u00a0 It&#8217;s important to focus as much on what you&#8217;re doing well, so that you can build upon your strengths, as correct what you&#8217;re not doing well.\u00a0<\/span><\/p><\/blockquote>\n<p><strong>9. Send a Daily Report Card to your teammates without fail.<\/strong><\/p>\n<p>One firm trader trumpeted the best practice of sending a Daily Report Card (DRC) to traders on his team to improve performance.\u00a0 This trader highlighted <a href=\"https:\/\/twitter.com\/TheOneLanceB\/status\/1524042931539173377\">Lance&#8217;s DRC template<\/a> as being very helpful.\u00a0 Lance suggested each trader make the DRC their own, tweaking this template to develop one best for them.<\/p>\n<p><strong>10. This is a gr8 market for which to work on your day trading.\u00a0<\/strong><\/p>\n<p>Several developing traders lamented they wanted to improve their day trading (as opposed to their swing trading).\u00a0 I jumped in: This is a gr8 time to day trade.\u00a0 VIX is elevated.\u00a0 I would love to see the desk do more momentum, scalp, and singles trading.\u00a0 I would love to see the desk not have to rely on the big trades and big days, as much as they have.\u00a0 While fewer trades, more size helps you make more.\u00a0 So does focusing on your day trading, scalping, momentum trading, hitting singles, in a high VIX trading environment.<\/p>\n<p>How can you hit more singles in a high VIX trading environment?<\/p>\n<p><strong><a href=\"https:\/\/www.smbtraining.com\/blog\/smb-disclosures?inf_contact_key=86e68ad95cfd2835f919c6dd5a8f153af651f238aa2edbb9c8b7cff03e0b16a0\">Important disclosures<\/a><\/strong><\/p>\n<p>Mike Bellafiore is the Co-Founder of SMB Capital, a proprietary trading desk, and SMB Training, which provides\u00a0<a href=\"https:\/\/broadcast.smbtraining.com\/smbwebinar1\/?utm_source=Blog-Bella\">trading education<\/a> in stocks, and options. Bella is the author of<em>\u00a0One Good Trade<\/em>\u00a0and\u00a0<em>The PlayBook<\/em>. He welcomes your trading questions at mbellafiore@smbcap.com.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Each month our traders meet for a monthly review with their Team.\u00a0 Our floor manager, @TheOneLanceB, our head of trader development- @SMBRecruiting, and I attend and provide mentorship during these meetings, which are run by the Team leader.\u00a0 Dr. Steenbarger provides invaluable feedback to traders on their monthly review, as well.\u00a0 Each trader shares their key takeaways from the prior &#8230; <a href=\"https:\/\/www.smbtraining.com\/blog\/10-key-takeaways-from-may-trading-from-the-prop-desk\" class=\"more-link\">Read More<\/a><\/p>\n","protected":false},"author":144,"featured_media":51591,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5463],"tags":[4676,73,1996,1989],"class_list":["post-51589","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-bella-daily-update","tag-day-trading","tag-prop-desk","tag-trading-class","tag-trading-course"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v26.1.1 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>10 Key Takeaways from May Trading | SMB Training<\/title>\n<meta name=\"description\" content=\"Stay ahead of the game with these 10 key takeaways from May trading at the prop desk. 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