Posted by: joetradingplace | June 12, 2012

Haji Warithu’s Interview

 

Haji has been trading forex for nearly a decade. Before he came to the world of forex, he was a Marine Officer. He trades very large lots and risks 10 percent of his capital, targeting 5-10 pips on day trades, he also swing trades using the same strategy. Haji live by the rules of simplicity, he believes that a mediocre wealth is just enough, having not too many will maintain your sanity.

At the time of the interview, Haji’s main account was up almost 900 percent as shown by an extract from his journal.

 

 Tell us about yourself; tell us a little about your life before trading:

 Let me introduce myself, my name is Haji Warithu. I’m from Brunei Darussalam, country of the Abode of Peace. English is our 2nd language because we were under British colonialism. Before I was a trader, I use to work on board a vessel that transports LNG from Brunei to Japan and South Korea. I was working under the Company SHELL. Salary was good but working away from my family was just psychologically disturbing. I admit, I missed my family. In a Year, I’ve been only around for at most 4 months in one year with them; the rest of my life was away at sea.  SO it was an unhealthy life even if the money was good.

 How did you get into trading?

 I first got into trading in 2003; I actually found it via web browsing. I was looking for an offshore investment, instead I saw this link telling me Earn forex by trading it buy and sell. At first I didn’t know what this market was all about. So I clicked and read it until I came to a point where it said leverage helping you trade bigger, easy money by the pips. Of course at first I didn’t realise this was one of the Brokers marketing strategy. They had a demo account, so I tried it. The demo was impressive, back then it was FXCM one of my first broker. The reason why I got attracted to it was that it was really like trading Wall Street screen. Of course with 1 or 2 trades making impressive money in the virtual world was a high for me. And so I was so eager to try it for real so I immediately opened a live account with a deposit of $2000.

 Were you successful at the beginning, if not, when did you turn the corner?

 Of course, nothing to be expected like the demo. I traded it based on just pure intuition without the proper knowledge of technical analysis and money management at all. So in short, I blew my account in 2 weeks. I deposited more funds in my live account and I blew it again…I did it 3 times, blowing every time. I realised that the fastest way to burn money is to trade forex. I stopped trading for a while and started to learn ways of Forex trading. I stumbled upon Rob booker course from Fxstreet and Sam Seiden. That brought change to my performance. My first corner stone of success after a series of losses was in 2008 after earning my first hundreds to thousands. From then on, the consistency brought me confidence.

 Did you commence trading with a small account or large account? What’s your advice to novice traders on this?

 I traded with a small account when I realised that money management was key and discipline. Its best to start with small first as little as $500. If you can gain double within 3 months from that capital, it will help you in tune with market. The reason to start small is to minimize your risk. The more experience you gain, the more trading edge you gain and the better position size you can utilise on a full scale trading.

 When did you realise that trading was not going to be just an attempt in the markets, but was going to be a fulltime career for you:

 I realised it the when I read stories like rob booker, Sam Seiden that they are trading for a living. So it was my main priority at first to be able to trade for a living. The only way to do it first was to reduce my expenses to a bare minimum, spending below my means. This way I can have extra fund that can be used for my account and for any rainy day (string of losses season). This does happen time to time at some point in your career being a trader. Every system has its drawdown, but be sure you’re ready to face it.

 Once you classed yourself as a successful trader, did you ever consider changing any aspects of your trading system?

 Yes but in terms of improving how to earn more without exposing much of my risk. The system is still the same, a supply and demand concept. I use cci and macd on some occasions only to confirm but not entirely to rely on. Currently testing on using heiken ashi to spot demand and supply on a 15 min chart. Still on backtest. Probably will be tested on my real live experimental account next month. So far the progress is promising. I actually discover the relationship of its color change had similar timing on when the levels were formed. Will update its progress on my blog.

 What kind of trader are you (day trader or swing trader):

 I am more like a Day trader and I love it. I do some swing on some occasion but most of the time day trading.

 From your journal, I have noticed that you target 5 pips, what’s your risk?:

 Yes I like 5 pips with large position size, because of its high hit rate. I usually risk 5 – 10% of my equity. The reason I believe this works for me because I have thoroughly tested the system inside out, its drawdowns for over 10,000 backtest trades with a 6 month forward testing on my separate experimental account. It may not work for some people, but it suits my personality and risk tolerance.

 I have also noticed a very high percentage growth in your account, how do you achieve such a high return:

 With 5 pip and large position size, its equivalent like trading 100 to 500 pip a day. SO the growth is exponentially high. Though I like the size because of the system I tested I know when to use large and small best on the low risk entries. Meaning I know when to pick a best quality level. All those hard work testing paid off. Forex in fact is all about hard work!

 You only trade Eurusd, why have you chosen this pair and don’t you think you are missing opportunities in other trending pairs:

 I believe that using 1 pair is enough to trade for a living. I have proven enough myself that I only trade the EURUSD to pay off my groceries. To trade multiple currencies not just increase your reward but also increases the number of risk. ‘Risk less, reward more, Trade less get more!’ that’s my ideology in trading.

 You trade very big lots, how long did it take you to get to those huge lots:

 It took me 2 – 3 months. Depends on what the capital size is. I initially grew from $2000 in 2008, by the end of the year it was $230,000 in net balance. BY 2009 I had $678,000 by midyear. I got stalled in 2010 for surgery and I was out from trading for 8 months. I was not working anymore at that time and resumed trading full time instead of part time. BY 2011 my funds had reached 3.5 million. So I separated them among different brokers and 70% of it in my saving account in Brunei. That Way I have spare money, and also trading for only 5 pip with large position size because each trade, is enough to spend for a month groceries. Imagine for a whole month profit.

 What do you find most frustrating with trading:

 IMPULSIVE behaviour is a killer. I do it on rare occasion. It normally happen if I had less sleep or rest. I know that when I am taking trades without a valid reason, I am being impulsive. I overcome it by re analysing my losing trade whether it is justified that it was simply stopped out or there is a further level nearby. If it was justified loss, then I leave it and wait for better opportunities. Also staring at a lower time frame chart for more than an hour does affect your decision making and you also tend to get more panicky. Best to avoid staring but leave as planned.

 Without giving too much away, how do you trade? What are the principles behind your methodology?

Odd enhancers. Normally I have my check list for identifying demand and supply. If most of the criteria or as per checklist is answered, then I get myself potential trade setup.

 How do you manage risk:

As long as it does not goes over 25% of my equity, that’s my Stop trading level.

Let us take a look at one of your recent trades (charts):

 

 

This is a 10 pip trade today. Short term – Day trading. When this kind of setup appear on the 5 min chart. I would take it anyday to get a 10 pip trade out of it. Because it is a level on top of levels and to me it’s a very high probability trade.

Put sell pending limit at 1.24758 with a TP 1.24658 and a SL 1.2489 using a 40 Lot. And the result of the trade is shown below

 

 What are the biggest faults a trader can have, did you encounter such faults yourself and how did you deal with them:

The most common fault here is winning. A long winning streak can make a trader become Euphoria and Overconfident. I’m not saying winning is a bad thing, but sometimes when you’re too good at winning, you just need to learn how to accept losses as well. Because once you use to winning, sometimes it’s difficult to accept losses. Trading is all about your mindset being ready. How I deal with them is once I get myself a loss in a day trade, I just move away from the computer and start going out taking a fresh air. Sit there for 5 – 10 min reflecting that today’s loss is just another day’s job. It’s not the end of the world. It’s a matter of you know when to stop. Because if you continue to look at the charts after a loss, the temptation of taking another trade to satisfy a feeling of regret and loss is just the same as revenge trading.

 How do you handle a bad day/week/month?

If I had a bad day, or week or month. I just simply stop trading. It is every trader’s mind that capital preservation is important than recovering the losses too quickly is not worth the try. Simply stop, do something you enjoy doing or a hobby, something that makes you positive. I like PC games, so I play PC games, shooting bad guys, and sometimes I just go out at the outdoor , for some jungle trekking. Do it until you become positive and refresh with a clear mind.

 What was your worst drawdown and how did you dig yourself out of that hole:

I had my worst drawdown early this year in January. Probably a worst start of the year. It took me 2 months to recover my mindset. I lost completely over $400,000 in my fund in a single day because I was hedging a trade that was not working completely at all. So I had to close it with a loss because the trade would have continuously floated in the red. I was having a fever after that loss that lasted for a week. 3 weeks after I stop trading, I was back on the drawing board , re backtesting my original 5 pip and swing trade until I build up my confidence back. In April I started to regain slowly my funds and recovered the lost amount within a month. I fully accept my mistake and learnt from it, and continue on as I do normally. I don’t even think back again what I loss, because If I keep that at the back of my mind it can affect my trading performance in terms of discipline. As I mentioned, trading is all about mindset, you have to be ready with your mindset.

 I understand you lost almost $400k, what kept you going and what did you learn from such a huge loss?

 What kept me going was to establish a positive mental feedback. I try not to rethink and feel on the loss. I try to believe it as a lesson. I believe that without a loss how would I learn to become a better trader. So in fact believing that loss is necessary and to embrace it means there are reason things happen and i was positive on that self reflection. A school teacher that i attended for parents to guide children on its path to be successful student really enlighten me. ,’Every difficulty has its solution to its answer hence that difficulty is the only way you learn how to overcome it’

The huge loss taught me a very good lesson in terms of psychology trading and sets my discipline to a more reasonable understanding of my personality in trading.

 What makes you different from so many other less successful traders?

I don’t see any difference at all. Every Trader is the same. It’s their personality what makes their success, not methodology. Different personality each has its own ways of trading skill. The reasons for the less successful traders are they are not willing to accept who they really are.

 I understand you have worked as a Marine Officer..is the discipline instilled in you on the sea helpful to your trading?

 Probably yes. Not sure the discipline as marine officer had the influence on my trading traits. But being target oriented as i use to work on the shell fleet made it possible to be discipline in achieving those targets. Because it reflects self improvement.

 What advice would you give to a novice trader?

Ensure your MINDSET is ready, because if it is ready, it is willing to accept any method that suits him/her well in any trading conditions. IF you master your psychology, then you can master any trading methods easily. Always have a goal before planning or before even trade. Have a purpose. It should be something achievable statistically and in time. Never Ever trade on impulse or emotion base decision. Proper sleep and food does make a difference in your trading performance. Have a journal to reflect what you did best or wrong. So you can learn from your mistakes. Trading is self taught, by self reviewing.

 What’s the best thing about trading?

The best thing about trading is you get to earn your very own salary. You have the time you need to spend with your families and do other stuff that you enjoy the most.

 What do you do when you are not trading (hobbies):

 My hobby is blogging. I used to blog so much. There are times when I have an idea to write, I just write them on my blog. You can read it at http  http://warithu.wordpress.com/or you can read my trading journal at http://www.meetpips.com/members/FxGenius/journal/764/closed

 

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Responses

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