From the Trading Floor to Bookmap
This article is based on a conversation with Henry.
Edited by Owain Higham.
You’re an experienced trader that’s been in the business for 20 years. What got you into trading all those years ago?
I used to work in theatrical scenery. It was a great job, but I wasn’t enjoying it anymore. So one night I’m in a bar in Manhattan, crying into my beer and bemoaning my fate, when these two guys come in—young, frat boy types. They sit next to me, very boisterous. A whole freaking empty bar and they grab seats right next to me. I was in my 30s and was like, ‘Oh God, I don’t wanna deal with this’. I didn’t wanna be rude, so I say, “Hey guys, no hard feelings, but I’m gonna move to the end of the bar.”
Later that night, one of them stumbles over ****-faced drunk and slurs, “Hey buddy, we feel bad. Let us buy you a beer.”
So I thought, “Oh, what the hell”, and before the night’s over one of the guys—Jim—asks, “Want me to sponsor you?”, and I was like, “What do you mean?”
“Trading stocks,” he replies.
I respond, “I don’t wanna be a broker—I’m not a salesman.”
“No, no,” he said. “Trading”.
Later I learned he’d destroyed it that day, banking like $15K. This was 2000, NASDAQ was on fire. One thing led to another and soon enough I was on the floor with his crew of about 20 guys trading on the top floor, right next to the NYSE. That was the beginning of the—at times exhilarating—and often depressing circus of trading for a living.
Was that in the days of open outcry?
No, that was just as computers had come in. It had been SOES (Small-Order Execution System) and that was over the phone, then the internet and computers took over. We were trading the Island ECN right there in the mix with all the market makers, I could see exactly what they were doing. I could hunt for the MM (market maker) with a massive fill order, the ‘Ax’, and I could front-run him. They hated us.
This is why I like Bookmap. During that brief period of the Dotcom mania I could see with clarity what was happening, and then, suddenly, I was blind. The game changed with the crash and I wasn’t allowed to participate at that level anymore, and I missed it. When I found Bookmap—boom, there it was again. I’m seeing order flow.
How do you trade these days?
I’m really good at picking reversals. I haven’t been so good at hanging on for the ride. I just didn’t have the confidence to take a 20-30 point stop. Because I’m conservative, time and time again, I was getting knocked out of trades that would have become solid gains had I just taken a little more pain.
This changed with Bookmap, and mainly because I can see the order flow. It’s like back to the days of seeing what the market makers are doing. It’s not just sitting on the edge of your seat, blind and feeling, “Okay, I’m ******.”
It’s kept me in good trades I would have been stopped out of before, and there’s nothing more infuriating than giving a couple hundred to the market and then having it turn and run 30 points. If the market were a sentient entity and I could get my hands around its throat, I’d be serving multiple life sentences for premeditated murder!
Bookmap has helped tremendously with that. It’s given me the confidence to say, “Let it be”. It’s not foolproof, it’s not press a button and you’re making money, but it has made it so much more enjoyable. All of the doubt, all of that FOMO (Fear Of Missing Out), so many troubling things, are gone. At least for me.
How many trades a day do you take, how long do you hold positions?
Before Bookmap, I took a lot of positions. It got bad. At one point: I went through $7,000 in commissions in one really psychotic day. My wife was concerned, and began draping herself in garlic garlands and dousing the house with holy water. I was possessed. She should have knocked me unconscious with a crucifix. It would have been an act of kindness on her part had she, and would have saved us a lot of money.
So yes, I’ve lost a lot in over-trading. I’d get into that groove of getting stopped out, stopped out, stopped out. It was death by a thousand cuts. With Bookmap, I’ve cut down to one quarter the contracts I used to trade. Bookmap has given me the confidence to sit back, be more measured, more confident, and wait it out, rather than suffer the default of being kicked in the nuts, again, and again, and again…
Previously I might trade through numerous contracts testing for a reversal and though I might not lose anything, neither was I profiting. Following Bookmap’s signaling, I’m comfortable to sit and wait for an entry. I can say, ‘Okay, it seems to be building something here, the buy or sell side have had their moment, they’re exhausted, so there’s potential”. Then it’s just a matter of holding tight as the reversal builds; waiting for a good entry. Bookmap offers unusually accurate signals compared to some indicators I’ve used.
In the past, I didn’t feel good about jumping into a move too much after a reversal. Can’t count how many winning trades I’ve allowed to run away from me due to an abundance of caution. It’s frustrating when it’s on a run, when it’s one of those days where it never dips and all you have to do is buy at any point and you’ll make a ton of money. Yet due to an overabundance of caution I would sit there, stupid with doubt, regret piling upon regret. Bookmap changed all that. It communicates to me when it’s safe to jump in. Bookmap clearly indicates when a run is near exhaustion, and when it’s not. So go ahead, jump in, take some risk on the stop. Nothing feels better than when you’ve caught a runner and all that’s required is to sit back and smile.
With Bookmap I hold positions longer, and holding positions longer has increased my profit per good trade. If you take 50% out of a move, you’re doing pretty good. If you push that to 70%, you’re doing great. Given I generally realized sub 50% returns before, adding a 10% to 50% gain to that has justified the expense of the program.
How did you hear about Bookmap?
I was trading one day and getting a little chewed up. In frustration I’m asking myself, why can’t I get access to order flow? It was driving me crazy, so I called up my broker ranting “What do you have that will show me the inside market? There’s gotta be something!”
He responded “Nothing really… wait, there’s this program we’re beta testing called ‘Bookmap’”. I signed up. To be honest, I took one look at the chart and thought “You gotta be kidding, what’s up with all the bubbles? Goofy as ****; forget it” There are guys out there that put charts together with lines going everywhere, and I’m like, you actually trade off that? I can’t make sense of it, and Bookmap seemed no better.
But it kept nagging at me, so eventually I decided: ‘Just give it a night’. It was after hours and I wasn’t doing anything, so I opened it up and I started to play. I soon realized I was playing with something powerful, started to see the genius of it, and I got really excited.
So I risked a few trades with the MicroMini, after hours. In short order and with an ease that was surprising I was up $170 trading a single Micro.
I’m not a supertrader, I’m never gonna be a multimillionaire from trading, but other than a couple of bad years, I’ve consistently made more money than I’ve lost. This doesn’t mean I’ve always been able to support myself solely on trading, Though the last couple of years have been good. The last six months have been even better. I credit this to Bookmap.
What are your bigger plans for the future?
My longer-term plans are looking to hold swing trades, whereas today, I’ll bank anywhere between 1k to 5K on a good day. I’m looking to let positions run for days, even weeks. As I mentioned, I’m good at calling reversals; though I haven’t been so good at holding on for the ride. Whereas a strong day position might make you smile, a strong two weeks will have you giddy, while cutting down significantly on the vig.
The constant grind of multiple trades every day has lost its appeal. I’m getting older and there are other things I’d like to do. To sit and stare at the screen all day; that’s robbing me of other opportunities.
I’m not about to go back to scenery. Honestly, the specter of a 9 to 5 gives me night sweats. I’m playing with Bookmap looking at longer time frames. In conjunction with a couple of other indicators, I’m gaining confidence in longer plays. Before I wouldn’t risk it. I just didn’t have the cajones to take a 100 point stop loss, looking for 400 in return.
Some out there might smirk at my timidity. As I freely acknowledge, I’m not a big swinging **** of a trader. So feel free; guilty as charged. It’s who I am. But I’ve managed to stay in the game for over two decades. On average I’ve made good money and I’ve never blown up an account. But it’s often been a slog. In the last six months I’ve increased my profit per positive trade and decreased my blood offerings to the market Gods in poor ones, and without much changing my approach, other than now being able—with Bookmap—to more clearly see money flow. For me this was a game-changer.
I want to stress: Bookmap’s not a panacea. You’re gonna lose money, you’re always gonna lose money. The point is that you need to at least make double what you lose in the time frames your trading method dictates. Two steps up, one step back. If you’re steady, have a good method and confidence in it, you’ll stay in the game. And staying in the game is what it’s all about.
Bookmap has given me greater confidence. It doesn’t trade for me, but rather accurately confirms the validity of what I’m looking at, the potentials I’m evaluating. After two decades I’ve learned to read a market fairly accurately. Bookmap acts to confirm judgements based on these years of experience. This has proved invaluable in alleviating self doubt and, as a result, increasing my profits.
In the end, you are either your own best friend or your own worst enemy. It’s the chief conundrum one must untangle when involved in this crazy trading life.