Introduction
In this Q&A, I, Chris Shunk, break down how a systematic short strategy helped me cross $1,000,000 in trading profits. I discuss strategy evolution, why creativity matters in systems, handling a 30-40% drawdown, modeling slippage, and why I now swing 70% of positions for bigger moves.
Trader Talks QnA
What challenges did you face as you got closer to $1M?
The hardest thing this year was working out the strategies I’m currently trading. Last year I didn’t make much, and the year before was a red year. I was losing faith in my strategies and had to build new ones from the ground up.
How did you overcome losing faith in prior strategies?
It’s just work—thinking about things in a different, creative way. Early on (2020–2021) we were shorting the open and covering the close. People thought it was stupid, and that’s partly why it worked. I took that lesson and applied it to build new, simpler systems without overfitting.
Why did the short-open/cover-close approach work back then?
Everyone thought it was dumb. We were doing it before we met Chris Verma, who also traded parabolics. The idea built off Ducks and Grittani concepts—track gappers, record open/high/low/close. It wasn’t from nothing, but the execution was simple and contrarian.
How do you keep systems simple but quantifiable?
I test ideas in Excel. You measure things like gap-and-run versus intraday runners. First, how much it runs; second, when it’s likely done. That could be a fixed percentage extension, or a retrace trigger after a certain stretch. I won’t share exact criteria—protecting the edge matters—but those are the concepts.
How do you define or quantify “backside”?
It has to run a certain amount and then hit a breaking point. Think like how Nate talks about it—wait for shorts to get squeezed, then a pullback confirms. Discretionarily you can see it, but you can also quantify runs, gaps, and retraces differently for gap-and-runs versus mid-day runners.
Any mental challenges right before crossing $1M?
I woke up with adrenaline, but I didn’t change behavior. I follow rules and my system. That’s the difference between amateur and professional—discipline. I did take a 30–40% bankroll drawdown during the China sector in May while traveling in Brazil. I felt bad, but I’d seen those drawdowns in my spreadsheets before, so I trusted it.
Do you ever break rules?
It’s easier for me than most, but I still break rules sometimes. If I don’t fully trust a strategy, it’s easier to break rules—like getting out early. Strategies I fully believe in, I follow well. Today I exited a couple early because I’m considering trashing them.
How many strategies do you run at once?
About five or six right now. I’m considering tossing two. I still run the first strategy—shorting the open and covering the close—but with smaller size, and I may stop it soon and move that capital to better systems or savings.
What’s changed most from when you started?
I expanded my view of parabolics to larger time frames. People laughed when we held from open to close. Now I hold even longer—probably swinging 70% of the time. I short less size but hold longer for bigger percentage moves. Lower risk, bigger reward, based on multi-day data.
Was $1M a goal, and what’s the goal now?
My goal has always been not needing another job. Now I want $200K–$300K a year in passive income to support my family. Maybe I won’t even trade then—we’ll see.
Advice for moving from discretionary to systematic?
We started with Tim Grittani’s trading to Sykes resources—data tracking and Excel. Track open, high, close, market cap, float. First system: short the open, cover the close. Then study parabolics—Chris Verma taught great material on that. Check older YouTube if available. On Twitter, guys like Go_Shock share value. System traders guard their edge more—teaching exact rules risks replication.
How did the big May drawdown affect you?
I made a mistake I’ve done before: I downsized my bankroll at the bottom of the drawdown. Then it turned around and I was trading smaller just as it got good—human, not robot. It happens, but I try to avoid it.
How often do discipline slips happen?
Maybe once every couple of months, something minor. Some things aren’t fully systemized—like how much to pull from the bankroll; I still do that by feel. Not going full size or covering too early might happen once every four months. During the China sector, one day I got so emotional I exited everything early; those shorts would’ve worked further if I followed the system.
How do you account for human error?
Slippage. In Excel, I model slippage by reducing expected returns each trade to account for mistakes, platform issues, or stops getting jumped. If a strategy is still profitable with generous slippage, it’s viable. Occasional rule breaks won’t make or break a truly good edge.
Is trading a full-time job for a system trader?
It’s extremely hard. Don’t go all-in. Start smaller than you think. Don’t risk money you can’t replace. I quit my job after four months, which forced me to work 13-hour days. System trading can be two hours a day in easy markets—I had a period in 2020–2021 making six figures that way. But I’ve also worked 12 hours a day and lost money. Lately, I work constantly to find new edges; maybe 2% of ideas hit, but that 2% can change your life.
Key Trading Insights from Chris Shunk
I keep my systematic short strategy simple, protect my edge, model slippage, and extend holding periods to capture multi-day parabolic fades. Creativity plus disciplined execution matters most.
- Simplify systems; avoid overfitting.
- Quantify extensions and retraces; categorize runners.
- Model slippage in your P&L; keep edges robust.
- Extend holds for larger percentage moves.
Chris Shunk Strategy
I started with an open-to-close short framework and evolved into multi-day swing shorts, focusing on parabolic exhaustion and backside confirmation, all tracked and tested in Excel.
Open-to-Close Short
Track gappers; short the open; cover the close. Simple, data-driven foundation inspired by Ducks and Grittani tracking methods. Smaller size now, possibly retiring it.
Parabolic Backside Swing
Measure run percentages; wait for stretch and signs of exhaustion or retrace triggers. Hold through multi-day fades for better risk-adjusted returns and larger percentage gains.
Chris Shunk Tools
I rely on Excel for data tracking and modeling slippage. I learned concepts from Tim Grittani’s resources and Chris Verma’s parabolic teachings; I also follow quant/system voices on Twitter.
- Platforms: Excel-based tracking for O/H/L/C, gap/run metrics.
- Education: Tim Grittani resources, Chris Verma’s parabolic videos.
- Community: Quant/system discussions on Twitter (e.g., Go_Shock).
Common Trading Mistakes to Avoid
Don’t downsize at the bottom of a drawdown. Don’t exit everything early from emotion. Don’t skip slippage modeling. Don’t risk money you can’t replace.
- Bottom-ticking bankroll reductions prolong recovery.
- Emotional exits often cut off working shorts.
Conclusion
Keep your systematic short strategy simple, protect your edge, and let data guide you. Model slippage, accept imperfection, and look for bigger multi-day opportunities. Share your questions in the comments and subscribe for more trader Q&As.