Weekly Update #2

Based on last week's post, I swapped to the dark side (short side of the small cap market) and other than the annoying factor of locate fees, this feels okay. The reason for this switch, and for any setup I pursue going forward, is that it must be based on and backed up by backtested, OOS validated data. That's the rule now. I also had to swap brokers to do it, since Webull doesn't allow shorts. So I'm on TradeZero now. Green on the week, but honestly it was mostly a process week. Live money, tiny size, just trying to get comfortable with shorting on a live account without doing anything stupid. I currently feel calm (for the most part) when taking these trades. I feel like I have very clear rules and a clear idea of what is supposed to happen and what isn't. Which is kind of the whole point of last week's post. The hesitation was coming from not knowing what I was trading, and this feels like the other side of that. I am still trying to figure out a forecasting model for locate fees. Right now I'm logging fees on the top gappers, for this past week and the next few weeks, so I have actual numbers instead of a guess. The reason this matters so much is that locate fees could make or break certain aspects of the edge. And where it shows up hardest is being selective on a price band basis. If a ticker is at $0.10, I need to locate way more shares to get 1R of risk on than I would on a $2 stock. Same risk, completely different share count, completely different fee size! I don't have the model yet. Just the log so far. I am not currently fully journaling until I can stabilize on the platform, given the broker swap. Which is probably an excuse, because I should be journaling either way. If I have rules, I am still manually executing them, even if for the most part the execution is systematic. There's no real reason not to be writing it down! Again, I feel like this post is a whole lot of nothing and just rambling from someone who is strategy hopping and just kind of lost. But hey, that's what it is until I figure this shit out. I feel close. Close to a system and setups I trust, because I have the data to back it up. Those stats have given me a new boost in confidence. And honestly, I should have somehow been trying to do this already. It was probably a mixture of laziness and not being resourceful enough. Not going out and finding a reliable and cheap data provider for historic data, not finding an LLM to code with, or just a platform where I didn't need to code in the first place (pre AI taking over the coding environment and allowing a goober like me to vibe code). Happy trading, F4VS A Retail Trader's Repository is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.