ColdTrade #3: Market Attitude

An annual trading summary by Wright on the Market’s Eugene 

While the markets are on holidays it is becoming a tradition to make a recap of our trading experience to share our growth from rookie to hopefully successful life-long futures traders.

Five years ago Nick and I joined Wright on the Market. I began trading futures three years ago in January with $10,000 of joint capital. You can read previous annual entries in our blog. The goal was to enhance Nick’s and my market education and to make profit. Trading futures was strictly a speculative venture as we handle no grain. Making or losing money with futures or options would provide an opportunity to practice what we were learning about the markets and serve as an example to encourage others to try trading or hedging through their own account.

At the end of the first year the account balance was $30,382. After the second year it was $27,541.

We had learned that trading on a small account is possible with micro and mini futures contracts. Futures trading is not dangerous, even though we had a margin call for a brief moment one time during the first year. But the risk-taking should be well planned and under control. It is not safe to trade without stop-orders, which should keep a trader from losing too much on a single trade. Plus, the size of that risk should be limited to 2-5% of the account equity per trade, the less is the safer.

A year ago we moved our capital to another broker to save on commissions and full service consultancy that I did not use. It was a big deal, as the average commission per round trade went from $92 to $12, and we saved about $5,000 this year on a comparable trades count.

However, I closed my third trading year in 2025 with just $16,190 in the account.

Markets were very volatile due to politics. Tariffs were announced, postponed, enacted, changed, paused, and removed. Technical signals did not and probably never will predict such chaos; thus established trading strategies may fail more than usual.

I made my own mistakes as well. A few times I lost way more dollars than I should have due to a wrong stop-order or when one or two times a stop-order was not executed by a trading software and I did not notice that for a while. Another couple times I took more risk than was allowed by the trading rules resulting in a bigger loss.

I have been busier than usual with some side projects and family matters during the year as my daughter was born in the spring, so I paid less attention to the markets and my trades, and it is generally bad for the trading business. As a side effect, I was relying more on external opinions and trade mark-ups. While I could have updated many trades according to changing markets to risk and lose less.

I think that trading should not be considered as a hobby as the commodity markets are very competitive and professional. Surely, it is not as hard work as farming, but it is not a walk in a park either and it could be very stressful. Trading requires a proper attitude, knowledge, discipline and attention. So I will try my best to focus on that. I read “Trade Stocks and Commodities with the Insiders: Secrets of the COT Report” by Larry R. Williams. It is worth the time if you want to understand COT reports better and use it in trading. I plan to read John C. Hull’s “Options, Futures, and Other Derivatives”, it is not an easy reading but highly recommended by professional traders and investors that I trust.

During the previous years, I traded futures mostly. A few times I bought and sold options, and wrote a put option one time. I plan to use options more often as buying puts or calls provide a fixed risk and the position would be resistant to momentary market surges on the news when a futures trade would be stopped-out frequently. However, trading options require finding a bigger price movement to profit compared to a futures position.

While I have been unable to make profit consistently so far, I see the past three years as a useful experience because that encouraged me to learn and study the markets and its tools & techniques better. I do believe that you have to find a way with trading on a small account before moving to bigger trades. Also, our account balance is positive even though I made a bunch of mistakes learning. I certainly have learned things about grain marketing I would have never known if I had not traded futures.

That is the 2025 summary. Thank you for your time & business with us. I wish you all Happy New Year with profitable farm marketing and trading!