Making Up Lost Ground Through Smaller Size And Fewer Drawdowns

Last week was another intense one in the stock market. Though, despite the continued volatility, I have managed to get my P/L ratio back into line by capitalizing on the opportunities in front of me and knowing when to walk away.

Of course, the best thing I had going for me over the past week was the fact that I didn’t start any of my trading days with a loss. That alone helped me approach my long positions with a more level-head and has even put me back in the green for the year after losing -$300,000 in the first week of February.

In fact, over the course of last week’s four trading days, I essentially made up that deficit and put myself on track to potentially pass the $1 million mark before March, though I’m not eager to press my luck given the previous few months of roller-coaster trading.

Tuesday kicked off with a few premarket trades in Socket Mobile, Inc. SCKT, which helped me start the actual session with a little more than $35,000. Unfortunately, I gave up about -$10,000 of that as SCKT consolidated at the $26 level, but tagged up on it later as it ripped to its day-high of $36 and finished with about $43,000 on SCKT, which was roughly my total for the day between a few other trades.

Wednesday ended up being my best day thanks to the huge move in CLPS Incorporation CLPS, which alone put me above $100,000. While I was at more than $150,000 at one point in the day, I did give up about -$35,000 off the top of CLPS and in a few trades TDH Holdings, Inc. PETZ. Nevertheless, it was a great six-figure day that helped set up the rest of the week.

Thursday saw some good early momentum in Greenland Technologies Holding Corporation GTEC and QuickLogic Corporation QUIK, the leading gap stocks that morning, which I was able to tag up on for about $30,000.

I closed out the week focusing on Vaccinex, Inc. VCNX, chalking up about $30,000 in premarket that I then doubled on the open with a beautiful gap and go setup. I followed up on VCNX later in the day for a little over $85,000.

Overall, it was a great week and one in which I felt in control. A large part of this is due to the fact that I was trading with a relatively small share size, generally around 20,000 shares and no more than 40,000 at a time. Compare that with last month where I was regularly holding 50,000 share positions.

That may, in part, be why I was able to exert more control over my day trading this past week, and also why I wasn’t suffering any outsized losses. It just shows that remaining aware of risk and adjusting your trades to lock in profit and not chase insane returns is ultimately the best and most consistent way to make a profit.

Hopefully, the market will continue to show the same momentum it has over the past few months and I can carry this risk-adjusted approach into March.