Airelon's Investing and Trading Journal

Sharpe Trade

2011-12-27T09:50:00.003-05:00

Many have wondered if they will see Dan "around the net". I still receive emails asking where I have gone? What about all of those videos? What if you couldn't save them to your computer?

As I have tried to explain in my last blog entry ... I'm not going away. Simply removing myself from aspects of social media that I find ... dangerous. In addition, the blog became exceedingly time consuming if I was going to do a video each and every day.

Well, there is a new website that should be much more time effective for myself in working to assist the low funded. Sharpe Trade. I've moved many of the playlists there, and beginning this Saturday, I will also have the weekly podcast there. As time passes, I will try to make it an easy to navigate one stop shop for "all things Dan". In addition, there is a new premium service available "The Sharpe Report".

That newsletter was offered from the daily blog to those that sent me their email. The daily blog will be going away ...

As always ... stay safe, trade well, and remember that love does not cost a dime

Dan
Sharpe Trade
info@sharpetrade.com

All Good Things ... (VIDEO)

2011-09-24T01:40:00.002-04:00

Remember me?

Yeah ... I'm in Mexico ...

While I have been spending my time traveling to a different country, moving and getting set up, getting acclimated with my new congregation and new friends in order to serve the congregations needs here ... I've been doing a lot of thinking. One aspect of my many musings has centered upon blogs, videos and social media in general.

And I have arrived at a few conclusions. As many of us will readily acknowledge, social media can have beneficial aspects. I have tried to be a force for good using this blog, Podbean, YouTube, Facebook and Twitter. But social media can also be insanely dangerous. Because in effect, it works like the Wild West, or a very radical, amoral free market. There are very little controls, and every uninformed, unqualified opinion has a voice that speaks with the conviction of a qualified expert.

And I am by no means immune to this danger. With anonymity and faceless contact, it becomes much easier to 'standardize a deviation' and begin addressing others in an arrogant, belittling manner.

And how such behavior can digress! Without looking to the most extreme examples, or even personal examples that I can cite, and simply remaining within the realms of Social Media that centers on the capital markets we only need look as far as those who use Social Media to pump flat out false information so as to get ones to buy, and keep buying physical Silver as the market continues to collapse. And by so doing, commit one the most basic of investing and trading errors! That is ... making financial decisions based on emotion and thoughts of revenge against banking institutions.

I have also learned since beginning the first blog at live.com, and then this blog ... that no matter how profitable an investor you are, no matter how profitable a trader you are, no matter how much you try to help, no matter how much information you provide for free? You cannot change the human psyche. You cannot stop people from making financial decisions based on fear, greed and revenge. You cannot stop people from listening to, and believing specious financial reasoning based on partial or even faulty data. You cannot make people become a profitable investor or trader.

You cannot alter the face of social media in the realm of the capital markets.

Of course, we all know this instinctively. No one can be 'made' to do anything. My rather belated point is that I personally believe that the dangers of social media are too often glossed over and ignored. Someone I know called this recent phenomenon "The Stolypin Contagion in Gestation". I thought that an excellent descriptor.

Now ... to another aspect of this blog that I have mentioned in other entries. Blogging, and especially vlogging takes a lot of time. For example, my wife and I hope to increase our volunteer time sevenfold. But just to shoot the video below, transfer it to the computer, convert the video to an format that can be edited, then edit the video, and then compile and finally upload and embed it? Took about four hours.

Unfortunately ... the math just doesn't work out. I can't continue shooting videos, and do what I wish to do with my life. My life is my own and not to be too morbid, but if I live to be an old man by current statistics? My human life is nearly half over. I think I've done a lot of good here, but there are a host of other endeavors I wish to engage in. As I mentioned in the previous blog entry, I have given this some thought and cannot really see how I am going to fit blogging, especially vlogging into my new schedule.

And as well, I've discovered I have a real distaste for having a public presence. The supporters and followers of this blog have been great. They've been more than great. But unfortunately, as is often the case in life? The nit-wits seem to outnumber those of us who seek reason, rationality and balance. It gets a bit tiresome to continue to receive nasty messages show up in my email inbox, when I'm not even actively blogging any longer.

Throughout the history of this blog, I have attempted to assist those who wished to be assisted with what I have learned with my nearly 16 years around the capital markets. I've done this for four years now. It's been a good run. I've last longer than a few critically acclaimed television shows.

But it is time, for this to all come to an end, and as well ... end my ties to the Wild Wild West of social media.

(Video Included. If you're seeing this entry elsewhere and cannot play the video? Click this link to go to the exact video entry ...)

We are enjoying ourselves here in Queretaro, Mexico ... and are settling in to our new congregation. And let me just say on that front ... there is a tremendous amount of work to do. We are only half way into the month of September at the time of this writing, and my wife and I have already been able to double the amount of time that we spend in our volunteer efforts. And that's with spending time getting our immigration papers in order, securing a place to live, turning on our electricity, water, internet, etc. We are looking forward to having a more 'set' routine so that we will be able to assist to a greater degree. That is, after all, why we moved here.

Yet at the same time, I wish to continue to help out folks as I have been, for the last five years. Folks who don't have $50,000 of disposable income to invest ... and those who would like to look over my shoulder.

So how do I accomplish all of the above? How can I avoid a public presence, cut back on the time that I spent vlogging, at at the same time, continue to share my thoughts on the capital markets and avoid the venom that can be social media?

I've been chewing on that. And I think I may have come up with a few ideas.

But first of all ... I need to state that this blog is now coming to a complete end. As I mentioned in my previous blog entry, even greater privileges of service may open up to me now that I am here in Mexico. I must be ready to expend more and more time with those privileges. Such privileges of service within our congregations are not compatible with the public presence that I developed through social meda. When you combine that fact with my complete aversion to any sort of public presence? I have come to the conclusion that I am going to completely dismantle this blog.

But I must admit, that I do believe that this blog, this journal, has been a force for good. For reason, rationality and balance.

(Later Edit: I have decided to keep the blog up, and keep the YouTube Videos in place. So they will remain there for purposes of archiving. They can be used for reference. But I will not be interacting with them in any way)

But can I continue to assist ones?

I believe so.

I will not say goodbye. Simply ... 'see you around' ...

* * *

Note: The above statements should not be construed as an investment or trading recommendation. Airelon's Investing and Trading Journal is a blog that allows subscribers to look 'over my shoulder' as it were, for my own personal specific trading and investing ideas and thoughts for the next week. But they are only thoughts as of the moment of publication, and are subject to change.. Any trades or investments that I discuss within this blog are simply my own thoughts regarding my own investing and trading outlook. Remember that entering any market is an individual decision. There is no guarantee that I will enter, or have entered any of the trading or investing ideas that I discuss in this blog; as larger accounts may require a different strategy as the ones presented here. This blog simply contains my trading and investing thoughts for the next week. I, the author do not grant this work for wide distribution beyond any single individual subscriber as this publication is protected by U.S. And International Copyright laws. All rights reserved. No license is granted to the user except for the user's personal use. No part of this publication or its contents may be copied, downloaded, stored in a retrieval system, further transmitted or otherwise reproduced, stored, disseminated, transferred, or used, in any form or by any means except as permitted under the original subscription agreement or with prior written permission. I personally only enter any market after watching and reading the tape and I trade using money management principles. The losses in trading can be very real, and depending on the investment vehicle and market, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. I do have 15 years of experience in trading and investing in these markets. Airelon's Challenge Chronicles are demo accounts,with all of the inherent problems therein, which are used within this blog in an attempt to track the results of my own thought processes., and is run as a model. Traders who should make their own decisions based off their own research, due diligence, and tolerance for risk. Any pictures used within this blog are believed to be public domain. Any charts that displayed using the ThinkorSwim platform, or any other charting software are believed to be public domain. Any other pictures were obtained through Wikipedia's public domain policy. As a reminder, any trades discussed for "Airelon's Challenge Chronicles" would only be 'day trades' according to the parameters discussed for Airelon's Challenge Chronicles, at this stage of the game in order to escape the risk of over-leveraged gap opens in the commodity futures markets. As a 'trading sister' would have grown to the $30,000 level, I would have graduated the account into 'swing trading'. In addition, it is understood that readers have read my YouTube methodology series. It is also understood that the writer of this blog has repeatedly warned against the dangers of shadowing any other traders thoughts. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research, and tolerance for risk.

Let's Call it an Extended Break ...

2011-07-26T10:00:00.009-04:00

It would be somewhat superfluous to try to explain all of the intricacies of doctrinal matters for my faith. Especially here on a blog that is about investing and trading money. I have long stated that I believe it wrong and immoral to mix money that is for profit as this journal does, and religious teaching.

Not that I believe it is wrong to be involved in 'for profit' ventures, money and business. Some first century Christians were obviously very wealthy and there was nothing wrong with that, as long as they kept the correct attitude (1 Timothy 6:17). But to mix religious beliefs with money making ventures is simply wrong. Jesus taught: "You received free, give free" (Matthew 10:8; Acts 8:20). He threw money changers out of the temple and would not even allow people to use the temple as a 'shortcut' through the city in order to carry utensils. (Mark 11:15,16). You cannot mix what is holy, with what is mundane and expect to receive approval from God.

So I say the proceeding to again state, that it would be not only superfluous to explain the nuances of my faith, but also wrong and immoral to do so in a venue about making money.

But at times, the two aspects of faith and money collide. I've reached such a point in my life.

To put it simply, there is a small group of people that I try to support at every opportunity associated with my faith. And right now, they need every single bit of my support, time, effort and energies.

Yes, this is involved with my move to Mexico that I have discussed for some time to help serve where there is a greater need. And I'm finding that as I make myself available for that move to Mexico, not only has my time become more pressed, but even more opportunities to assist those I wish to assist are opening up to my wife and I. One privilege was opened up to me, that I have to be honest ... I still am having trouble grasping the sheer enormity of the privilege.

With these new opportunities I've sat down and "calculated the cost" (Luke 14:28) as it were. And at the present time, I cannot see how I can continue with my journaling here, and continue to expand my ministry as I wish to do. As I stated at the outset, it would be superfluous to try to explain all of the nuances of doctrinal matters for my faith. But trust me when I say ... when I 'calculate the cost' at the present time, I cannot see how it could possibly be done.

This is not easy for me. Not easy at all. To be very honest about it, I've sort of seen this eventuality coming to a head in the back of my mind for some time; and I've tried to avoid thinking about it. But when I finally saw that the two were in conflict? My heart broke a little bit. I don't want to take a break from journaling at all. I have immensley enjoyed helping ones, free of charge, understand how I have invested and trade my own finances. Especially throughout the challenging economic times of the last few years.

But sometimes in life, two things we dearly love to do collide. And we are left to make a choice. I choose my service to God. I always will. Living my life in this way has created the 'best' parts of who I think I am as a person.

I will continue to run the Challenge Project privately; because when it reaches $100,000, I will have a CPA audit run on those accounts. I'll even tell you how I've scheduled Rule No. Two Deposits for the upcoming months, so that I'm not leaving ones completely 'high and dry':

Until August 29th, 2011:
All of Rule No. two is going to be applied towards the dividend investing account. I had no plans to purchase or average down on any stocks, but that account needed work so that future maneuverability could be maintained and built upon.

From August 15th, 2011 forward:
All deposits of rule no. two, with the exception of the savings side-pocket, would be of $20.00, with $5.00 being put towards a new Forex trading account at Oanda. So deposits to the investing account or the trading account from this point forward? $5.00 of the $25.00 would go towards the Forex account, so that could be built up to trade micro-lots.

September 2011:
Rule no. two would be applied to the savings side-pocket. Full $100.00 deposits. My goal here is to get the savings side-pocket to the next goal, and so that I could then working past the goal and see about being at a stage where I could then set up a strategy for household input cost hedging and possibly side-pocket purchases.

October 2011 to the end of the year:
I was going to make deposits towards the trading accounts alone, so that I can be in a position to be actively trading by the end of the year, and into 2012.

So there is a look ahead for the Challenge Project. But for now, I'm going to sign off. I won't say permenantly, because we don't know what the future holds.

So for now ... let's call this an 'extended break' or 'leave of absence' from my journaling efforts here at this blog. Feel free to contact me by email. Feel free to download all of the videos from my YouTube Channel by using a Free YouTube Downloader for private use.

I'll miss this, that is for sure ...

Challenge Project Summary: July 25, 2011

2011-07-25T09:22:00.027-04:00

Previous $500 Challenge Project Balances:

"The Three Sisters":

Investing "Sister" Balance: $1,327.63
Trading "Sister" Balance: $2,394.36
Side-pocket Savings "Sister" Balance: $875.29
Total Challenge Project Funds: $4,597.28

Introduction:
The original video explanation of the Challenge Project that began with $500, is to be found here. If you would like to hear the "why" behind the challenge project, you can find that here as well as here. The Challenge Project is basically a demonstration of a model that anyone could at least follow along with on a weekly basis. It is my attempt without cost, to help out the 'little guy' when it comes to investing and trading by providing an example, a 'model' as it were ... as run by myself as a professional trader with real money, in accounts that I own; following my own three sisters portfolio management system; albeit modified a bit to operate with low funds. From time to time, I provide snapshots of the broker statements.

Rule No. 2 of the Challenge Project states that each month, we can divvy up $100.00 as we wish between the various challenge project accounts. We split up Rule No. 2, into weekly segments; or $25.00 a week. As I mentioned on August 10th, 2010 I have liquidated all of the other personal accounts that I've discussed on this blog for the last 4 years, and to emphasize the strength of these principles? I will demonstrating my success, again, this time it will be live, with the 'Challenge Project', full time.

For this week, the $25.00 weekly deposit is being transferred to the Challenge Project DIVIDEND INVESTING Account.

You will note there was no investing and trading podcast last week.

Something rather big has come up. It involves an opportunity that has opened up before me. Not with the capital markets, investing, or trading. But with my faith. And this opportunity is simply too big to ignore.

However that opportunity involves the future of this blog, and the possible end of this journal. I know this is a pretty big bomb to drop on everyone that has been following my journal, and I will discuss this in greater detail tomorrow.

But my first priority has to be to my faith, my principles and my life.

Here are the new balances for each of the Challenge Project accounts ...

Challenge Project Balances After Rule No. 2 Deposit:

Goals for Each Account

Investing Account: This Entry describes the next goal. Account is 'active'
Trading Account: $2,600.00
Savings Side-Pocket Account: This Entry describes the next goal. Account is 'active'

Investing Account Balance: $1,363.21
(YTD the account is +33.6 % YTD Return is about +5.239 % )

6.3585 shares of KO ( DRIP is on for 4.3585 shares - Yield is +2.6961 % )
5.2422 shares of JNJ ( DRIP is on for 3.2422 shares - Yield is +3.4173 % )
6 shares of GIS ( DRIP is not on for any shares - Yield is +3.2258 % )
Cash $343.15 ( 25.17 % )

Percentages of that Cash:
-$200.00 of this cash I reserve for 'maneuvering' capital ( 58.28 % )
-$ 30.25 of this cash I reserve to D.C.A. KO ( 8.815 % )
-$ 57.22 of this cash I reserve to D.C.A. JNJ ( 16.67 % )
-$ 30.68 of this cash I reserve to D.C.A. GIS ( 8.941 % )
-This leaves $ 15.00 cash available for a new purchase ( 4.371 % )
-This leaves $ 10.00 cash available for a second new purchase ( 2.914 % )

Additional $218.75 ( 16.05 % ) available from slush fund, up to $1,581.96

Investing Account Balance Year to Date
(Can be Enlarged)

Trading "Sister" Account: $2,394.36
( YTD cash equity up 7.885 % Return on Capital is 0 % )

$2,394.36 set aside for Commodity Futures trading

-2% risk tolerance gives us $47.88 'at risk' for draw-down tolerance
-3% risk tolerance gives us $71.83 'at risk' for draw-down tolerance
-Additional $218.75 available from draw-down / slush fund, to $2,613.11

$0.00 set aside for Forex trading

Trading Account Balance Year to Date
(Can Be Enlarged)

Savings Side-Pocket Balance: $875.29
( YTD cash equity up about 40.05 % Return on Capital is 0.03314 % )

$218.75 for a Slush fund / Draw-down Kill Switch fund
$437.79 for a Base Savings

-$351.79 of this cash I reserve for 'burn rate / maneuvering' capital ( 80.36 %)
-$ 59.00 of this cash I reserve for CD Ladder creation ( 13.48 % )
-$ 10.00 of this cash I reserve for the first side-pocket purchase ( 2.284 % )
-$ 10.00 of this cash I reserve for the second side-pocket purchase ( 2.284 % )
-$ 7.00 of this cash I reserve for the hedging account ( 1.599 %)

$218.75 for Emergency Saving

Savings Account Balance Year to Date
(Can Be Enlarged)

- As described in previous entries, all deposits past $675.00 will be towards an interest bearing account, although it separate accounts will still be treated as one 'sister' portion of the book

Total $500 Challenge Project Balance: $4,632.86 ( YTD the account is +19.88 % YTD Return is about +1.493 % )

* * *

Note: The above statements should not be construed as an investment or trading recommendation. Airelon's Investing and Trading Journal is a blog that allows subscribers to look 'over my shoulder' as it were, for my own personal specific trading and investing ideas and thoughts for the next week. But they are only thoughts as of the moment of publication, and are subject to change.. Any trades or investments that I discuss within this blog are simply my own thoughts regarding my own investing and trading outlook. Remember that entering any market is an individual decision. There is no guarantee that I will enter, or have entered any of the trading or investing ideas that I discuss in this blog; as larger accounts may require a different strategy as the ones presented here. This blog simply contains my trading and investing thoughts for the next week. I, the author do not grant this work for wide distribution beyond any single individual subscriber as this publication is protected by U.S. And International Copyright laws. All rights reserved. No license is granted to the user except for the user's personal use. No part of this publication or its contents may be copied, downloaded, stored in a retrieval system, further transmitted or otherwise reproduced, stored, disseminated, transferred, or used, in any form or by any means except as permitted under the original subscription agreement or with prior written permission. I personally only enter any market after watching and reading the tape and I trade using money management principles. The losses in trading can be very real, and depending on the investment vehicle and market, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. I do have 15 years of experience in trading and investing in these markets. Airelon's Challenge Chronicles are demo accounts,with all of the inherent problems therein, which are used within this blog in an attempt to track the results of my own thought processes., and is run as a model. Traders who should make their own decisions based off their own research, due diligence, and tolerance for risk. Any pictures used within this blog are believed to be public domain. Any charts that displayed using the ThinkorSwim platform, or any other charting software are believed to be public domain. Any other pictures were obtained through Wikipedia's public domain policy. As a reminder, any trades discussed for "Airelon's Challenge Chronicles" would only be 'day trades' according to the parameters discussed for Airelon's Challenge Chronicles, at this stage of the game in order to escape the risk of over-leveraged gap opens in the commodity futures markets. As a 'trading sister' would have grown to the $30,000 level, I would have graduated the account into 'swing trading'. In addition, it is understood that readers have read my YouTube methodology series. It is also understood that the writer of this blog has repeatedly warned against the dangers of shadowing any other traders thoughts. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research, and tolerance for risk

Trading for a Living (Series): So Where Has Dan Been At Lately? (VIDEO)

2011-07-20T10:45:00.009-04:00

"Get busy living, or get busy dying. " - Steven King

So I haven't had as many videos lately. So I thought I would document in a video ... why there haven't been that many videos as of late ...

(Video Included. If you're seeing this entry elsewhere and cannot see the Video? Click this link to view the entry ...)

Here is the blip.tv version of the video.

* * *

Note: The above statements should not be construed as an investment or trading recommendation. Airelon's Investing and Trading Journal is a blog that allows subscribers to look 'over my shoulder' as it were, for my own personal specific trading and investing ideas and thoughts for the next week. But they are only thoughts as of the moment of publication, and are subject to change.. Any trades or investments that I discuss within this blog are simply my own thoughts regarding my own investing and trading outlook. Remember that entering any market is an individual decision. There is no guarantee that I will enter, or have entered any of the trading or investing ideas that I discuss in this blog; as larger accounts may require a different strategy as the ones presented here. This blog simply contains my trading and investing thoughts for the next week. I, the author do not grant this work for wide distribution beyond any single individual subscriber as this publication is protected by U.S. And International Copyright laws. All rights reserved. No license is granted to the user except for the user's personal use. No part of this publication or its contents may be copied, downloaded, stored in a retrieval system, further transmitted or otherwise reproduced, stored, disseminated, transferred, or used, in any form or by any means except as permitted under the original subscription agreement or with prior written permission. I personally only enter any market after watching and reading the tape and I trade using money management principles. The losses in trading can be very real, and depending on the investment vehicle and market, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. But I do have 15 years of experience in trading and investing in these markets. Airelon's Challenge Chronicles are demo accounts,with all of the inherent problems therein, which are used within this blog in an attempt to track the results of my own thought processes., and is run as a model. Traders who should make their own decisions based off their own research, due diligence, and tolerance for risk. Any pictures used within this blog are believed to be public domain. Any charts that displayed using the ThinkorSwim platform, or any other charting software are believed to be public domain. Any other pictures were obtained through Wikipedia's public domain policy. As a reminder, any trades discussed for "Airelon's Challenge Chronicles" would only be 'day trades' according to the parameters discussed for Airelon's Challenge Chronicles, at this stage of the game in order to escape the risk of over-leveraged gap opens in the commodity futures markets. As a 'trading sister' would have grown to the $30,000 level, I would have graduated the account into 'swing trading'. In addition, it is understood that readers have read my YouTube methodology series. It is also understood that the writer of this blog has repeatedly warned against the dangers of shadowing any other traders thoughts. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research, and tolerance for risk.

Gained a "Smidgin" on a Trade that Went Against Me ...

2011-07-19T08:37:00.024-04:00

So, yesterday I discussed the fact that I was developing a Forex strategy in which I would move in and out of positions by 'picking and scratching'. In other words, as a position began, I would begin to slide into that position and when a position moved against me, I would begin to dump out.

I thought that today I'd throw up a few screenshots of just such a process. I think it's a good example because a) I gained a few pennies in profit, but b) the trade actually whipsawed me out, and moved against me.

So, let's begin.

This morning, knowing that I had an 8:30 news item coming out ... I thought I would try a short in the EUR/USD. Now it's important to note trade management principles before we go any further. If it's profitable, I'm looking at a time frame of about 9 hours ... again, if profitable. If it moves against me, I'm the kind of trader that likes to know right away. So if profitable, then I will begin to add to the trade at key spots. If it isn't profitable, I'll probably be out within the hour.

So I began, by only going short 150 EUR/USD. After I went short that 150, I saw another region develop that I would begin to short another 50, as you can see below ...

EUR/USD
(Click to enlarge)

At this point, I'm already thinking, that if we look to the larger time frames (not pictured here, but I'm keeping an eye on through my ToS platform)? I'm looking at a situation that could coil against me and push higher. Remember, I always have my eye on multiple time frames whenever I'm in a trade ... to push into the trade. But I also have my eye, not on the profit, but on the risk. So at this point, I know that 8:30 is approaching, and that is my wild card by which we'll see higher volatility. But regardless of 8:30, the coiling is occuring in the here and now. It has to break lower, and break right away.

This area of support continues to build, so as you see in the next frame, I pull up the order to short that 50 little closer to this support ...

EUR/USD
(Click to enlarge)

Very shortly thereafter, I'm filled short. So now I'm short 200 EUR/USD. I'm willing to add to my short. But at this point, I know that it has to break lower, and I'd like for it to break lower hard and fast.

EUR/USD
(Click to enlarge)

And that's what starts to happen ...

EUR/USD
(Click to enlarge)

At least at first.

Then the market stalled, and if memory serves, this is the point that I started thinking ... "It's going to coil against me. That's based on nothing more than reading the price interact with the moving averages. Very simple. But I'm thinking that at this point, this isn't playing out as planned. Switch your mind to getting out Dan, and getting out profitably."

But you know ... I've learned that it's very, very foolish, to just start dumping out of the position immediately. Build parameters and let the market tell you what's going on. Take advantage of the market when you can. At this point, I still believe that the market is going to coil against me and move higher. But that doesn't mean that I have to take action immediately when that thought is formed.

EUR/USD
(Click to enlarge)

I mean, just look at the trade in this chart? Yes, on the longer time frames (again, not pictured here), I'm looking at a situation that could coil against me. But I'm still below our shorter time frame moving averages / trend. I no longer like this trade ... but I have my mind open.

8:30 continues to approach, when I know the volatility will increase.

The market pops higher, up to the moving averages, and then turns around and again ... starts to move lower.

But simply because the chart is now moving in my direction, I don't begin to feel that suddenly 'no, I was wrong ... the market won't coil against me'. I'm not going to waffle back and forth within the trade, simply because it takes a few ticks in my direction. I don't like the trade. I'm convinced this thing is going to coil against me.

Thus, I'm still thinking ... "Don't push further Dan, just get out when you can" ...

EUR/USD
(Click to enlarge)

I start shredding out of the position as I have a bit of profit. I began by buying back 40.

The trade can still convince me but it had better act fast, or I'm out the door.

It moves lower, and I grab some profit on a bit more, but not 40 this time. Now, I only take profit by buying back 30. At this point? If it moves drastically in my favor, I would think about staying in the trade longer. But it has to convince me ... immediately.

Which it doesn't do. So I begin to shred out of the position completely as it stalls. And then I dump more as it moves against me, until I'm completely out of the trade.

EUR/USD Trade Activity
(Click to enlarge)

The market continued to move against me, but I somehow managed to gain a penny. I was pleased with myself at this point.

This type of trading means that I'm going to greatly have to sharpen my trade management skills. With commodity futures, I never 'push in', or 'push out'. I have my position size, and then as it moves in my direction, I take profits. Period. This is due to the fact that commodity futures are nowhere near as liquid as Forex, and thus, I have developed a particular position size management style. With Forex, I have a little more flexiblity due to the higher liquidity.

Then I did something I tell new traders to not do ...

I took a look back at the chart, and saw that it then moved lower.

So quite frankly, I got whipsawed here in this example ... but I never ... ever mind that. In fact, I think that makes this an excellent example. The second a trader tries to figure out how the or she can 'stop getting whipsawed', in my humble opinion ... they are sunk as a trader. Because you can't avoid it. It's going to happen. The trick is learning how to not a) believe that the 'market whipsaw' is the problem and b) emotionally ignore market action after you're out of the trade.

Trading is psychological in nature. It doesn't matter if it's stocks, commodity futures, forex or at a pawn shop.

I'm going to conclude by saying that I am adding $5.00 to this tiny account, to represent my aforementioned comments of how rule number two will have impact on my actual Forex trading, according to the rules of the Challenge Project.

EDIT: 11:10 am est - And that's why we don't care about whip-sawing. Moved higher again. Market is choppy. When you're out of the trade, you're out of the trade. Don't worry about it, because the market is going to do whatever it wants to do ...

* * *

Note: The above statements should not be construed as an investment or trading recommendation. Airelon's Investing and Trading Journal is a blog that allows subscribers to look 'over my shoulder' as it were, for my own personal specific trading and investing ideas and thoughts for the next week. But they are only thoughts as of the moment of publication, and are subject to change.. Any trades or investments that I discuss within this blog are simply my own thoughts regarding my own investing and trading outlook. Remember that entering any market is an individual decision. There is no guarantee that I will enter, or have entered any of the trading or investing ideas that I discuss in this blog; as larger accounts may require a different strategy as the ones presented here. This blog simply contains my trading and investing thoughts for the next week. I, the author do not grant this work for wide distribution beyond any single individual subscriber as this publication is protected by U.S. And International Copyright laws. All rights reserved. No license is granted to the user except for the user's personal use. No part of this publication or its contents may be copied, downloaded, stored in a retrieval system, further transmitted or otherwise reproduced, stored, disseminated, transferred, or used, in any form or by any means except as permitted under the original subscription agreement or with prior written permission. I personally only enter any market after watching and reading the tape and I trade using money management principles. The losses in trading can be very real, and depending on the investment vehicle and market, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. I do have 15 years of experience in trading and investing in these markets. Airelon's Challenge Chronicles are demo accounts,with all of the inherent problems therein, which are used within this blog in an attempt to track the results of my own thought processes., and is run as a model. Traders who should make their own decisions based off their own research, due diligence, and tolerance for risk. Any pictures used within this blog are believed to be public domain. Any charts that displayed using the ThinkorSwim platform, or any other charting software are believed to be public domain. Any other pictures were obtained through Wikipedia's public domain policy. As a reminder, any trades discussed for "Airelon's Challenge Chronicles" would only be 'day trades' according to the parameters discussed for Airelon's Challenge Chronicles, at this stage of the game in order to escape the risk of over-leveraged gap opens in the commodity futures markets. As a 'trading sister' would have grown to the $30,000 level, I would have graduated the account into 'swing trading'. In addition, it is understood that readers have read my YouTube methodology series. It is also understood that the writer of this blog has repeatedly warned against the dangers of shadowing any other traders thoughts. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research, and tolerance for risk.

Challenge Project Summary: July 18, 2011 (PODCAST)

2011-07-18T09:15:00.032-04:00

Previous $500 Challenge Project Balances:

"The Three Sisters":

Investing "Sister" Balance: $1,304.93
Trading "Sister" Balance: $2,394.36
Side-pocket Savings "Sister" Balance: $875.29
Total Challenge Project Funds: $4,574.58

Introduction:
The original video explanation of the Challenge Project that began with $500, is to be found here. If you would like to hear the "why" behind the challenge project, you can find that here as well as here. The Challenge Project is basically a demonstration of a model that anyone could at least follow along with on a weekly basis. It is my attempt without cost, to help out the 'little guy' when it comes to investing and trading by providing an example, a 'model' as it were ... as run by myself as a professional trader with real money, in accounts that I own; following my own three sisters portfolio management system; albeit modified a bit to operate with low funds. From time to time, I provide snapshots of the broker statements.

Rule No. 2 of the Challenge Project states that each month, we can divvy up $100.00 as we wish between the various challenge project accounts. We split up Rule No. 2, into weekly segments; or $25.00 a week. As I mentioned on August 10th, 2010 I have liquidated all of the other personal accounts that I've discussed on this blog for the last 4 years, and to emphasize the strength of these principles? I will demonstrating my success, again, this time it will be live, with the 'Challenge Project', full time.

For this week, the $25.00 weekly deposit is being transferred to the Challenge Project DIVIDEND INVESTING Account.

I put together a small podcast today for today's Challenge Project summary, with a ... well ... pretty interesting development that I announce near the end of the podcast (although I'm pretty sure that everyone knew it was coming).

(Podcast Included. If you're seeing this entry elsewhere and cannot play the podcast? Click this link to go to the exact podcast entry ...)

Podcast Powered By Podbean

Click here to download this podcast.

Here is a screen-shot of the activity that I mentioned on the $50.00 Forex account that I had last night ...

Trading Activity
(Click here to Enlarge)

Here are the new balances for each of the Challenge Project accounts ...

Challenge Project Balances After Rule No. 2 Deposit:

Goals for Each Account

Investing Account: This Entry describes the next goal. Account is 'active'
Trading Account: $2,600.00
Savings Side-Pocket Account: This Entry describes the next goal. Account is 'active'

Investing Account Balance: $1,327.63
(YTD the account is +30.12 % YTD Return is about +4.509 % )

6.3585 shares of KO ( DRIP is on for 4.3585 shares - Yield is +2.7839 % )
5.2422 shares of JNJ ( DRIP is on for 3.2422 shares - Yield is +3.3803 % )
6 shares of GIS ( DRIP is not on for any shares - Yield is +3.2318 % )
Cash $318.15 ( 23.96 % )

Percentages of that Cash:
-$200.00 of this cash I reserve for 'maneuvering' capital ( 62.86 % )
-$ 25.25 of this cash I reserve to D.C.A. KO ( 7.937 % )
-$ 47.22 of this cash I reserve to D.C.A. JNJ ( 14.84 % )
-$ 25.68 of this cash I reserve to D.C.A. GIS ( 8.072 % )
-This leaves $ 10.00 cash available for a new purchase ( 3.143 % )
-This leaves $ 10.00 cash available for a second new purchase ( 3.143 % )

Additional $218.75 ( 16.48 % ) available from slush fund, up to $1,546.38

Investing Account Balance Year to Date
(Can be Enlarged)

Trading "Sister" Account: $2,394.36
( YTD cash equity up 7.885 % Return on Capital is 0 % )

$2,394.36 set aside for Commodity Futures trading

$0.00 set aside for Forex trading

Trading Account Balance Year to Date
(Can Be Enlarged)

Savings Side-Pocket Balance: $875.29
( YTD cash equity up about 40.05 % Return on Capital is 0.03314 % )

$218.75 for a Slush fund / Draw-down Kill Switch fund
$437.79 for a Base Savings

$218.75 for Emergency Saving

Savings Account Balance Year to Date
(Can Be Enlarged)

- As described in previous entries, all deposits past $675.00 will be towards an interest bearing account, although it separate accounts will still be treated as one 'sister' portion of the book

Total $500 Challenge Project Balance: $4,597.28 ( YTD the account is +18.96 % YTD Return is about +1.268 % )

* * *

Note: The above statements should not be construed as an investment or trading recommendation. Airelon's Investing and Trading Journal is a blog that allows subscribers to look 'over my shoulder' as it were, for my own personal specific trading and investing ideas and thoughts for the next week. But they are only thoughts as of the moment of publication, and are subject to change.. Any trades or investments that I discuss within this blog are simply my own thoughts regarding my own investing and trading outlook. Remember that entering any market is an individual decision. There is no guarantee that I will enter, or have entered any of the trading or investing ideas that I discuss in this blog; as larger accounts may require a different strategy as the ones presented here. This blog simply contains my trading and investing thoughts for the next week. I, the author do not grant this work for wide distribution beyond any single individual subscriber as this publication is protected by U.S. And International Copyright laws. All rights reserved. No license is granted to the user except for the user's personal use. No part of this publication or its contents may be copied, downloaded, stored in a retrieval system, further transmitted or otherwise reproduced, stored, disseminated, transferred, or used, in any form or by any means except as permitted under the original subscription agreement or with prior written permission. I personally only enter any market after watching and reading the tape and I trade using money management principles. The losses in trading can be very real, and depending on the investment vehicle and market, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. I do have 15 years of experience in trading and investing in these markets. Airelon's Challenge Chronicles are demo accounts,with all of the inherent problems therein, which are used within this blog in an attempt to track the results of my own thought processes., and is run as a model. Traders who should make their own decisions based off their own research, due diligence, and tolerance for risk. Any pictures used within this blog are believed to be public domain. Any charts that displayed using the ThinkorSwim platform, or any other charting software are believed to be public domain. Any other pictures were obtained through Wikipedia's public domain policy. As a reminder, any trades discussed for "Airelon's Challenge Chronicles" would only be 'day trades' according to the parameters discussed for Airelon's Challenge Chronicles, at this stage of the game in order to escape the risk of over-leveraged gap opens in the commodity futures markets. As a 'trading sister' would have grown to the $30,000 level, I would have graduated the account into 'swing trading'. In addition, it is understood that readers have read my YouTube methodology series. It is also understood that the writer of this blog has repeatedly warned against the dangers of shadowing any other traders thoughts. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research, and tolerance for risk

More on Forex and a Remake Explanation Video (VIDEO)

2011-07-14T14:07:00.009-04:00

So yesterday I was playing a bit more with Forex trading. I'll share the comments I posted privately to "C", who has been helping me along as I delive into what is a new arena for me ...

"I tried dinking around with buying EUR/USD a bit this morning, and got burned twice with losses. I wasn't sure how close to 10:00 am est I would want to be long, so got long a bit early. Was completely out of long by 9:50 or so, before the big dive down.

I was basically trying to figure out when to be long for Bernanke's testimony.

Then I waited until 10:00 am, and no joke, went long 200 at 10:00 am on the nose. It coincided with another bit of firm support, so I wanted those two events to coincide.

Shredded em all off, ended up with a profit that just ended up being just past where I began this morning ...

I'm churning a bit here, but rather than newbie churn, it's more of a matter of demo trading this all out. And heck, this is why we demo trade. I have to figure my way around events, news, a specific rule set for the incredible ease I'm having of shredding in and out of positions (seriously, I've never seen something so easy). I have to get the 'feel' of this better, because as of now ... throughout every profitable trade, I've noticed that I'm shredding off way too fast.

There are a couple of more experiments I want to run, but at this point I'm going to back off for a bit, and run some more numbers regarding time frame ..."

So that's where I am at this point. I have to work on managing the time frames to the size of the position, which is in essence? Trade Management.

As well, you may have noticed that there was a new video today on YouTube ...

(Video Included. If you're seeing this entry elsewhere and cannot see the Video? Click this link to view the entry ...)

Click here for the blip.tv version of this video.

I will use that video to showcase my content on YouTube, rather than the twenty five minute "summary" that was on my channel page previously.

* * *

Note: The above statements should not be construed as an investment or trading recommendation. Airelon's Investing and Trading Journal is a blog that allows subscribers to look 'over my shoulder' as it were, for my own personal specific trading and investing ideas and thoughts for the next week. But they are only thoughts as of the moment of publication, and are subject to change.. Any trades or investments that I discuss within this blog are simply my own thoughts regarding my own investing and trading outlook. Remember that entering any market is an individual decision. There is no guarantee that I will enter, or have entered any of the trading or investing ideas that I discuss in this blog; as larger accounts may require a different strategy as the ones presented here. This blog simply contains my trading and investing thoughts for the next week. I, the author do not grant this work for wide distribution beyond any single individual subscriber as this publication is protected by U.S. And International Copyright laws. All rights reserved. No license is granted to the user except for the user's personal use. No part of this publication or its contents may be copied, downloaded, stored in a retrieval system, further transmitted or otherwise reproduced, stored, disseminated, transferred, or used, in any form or by any means except as permitted under the original subscription agreement or with prior written permission. I personally only enter any market after watching and reading the tape and I trade using money management principles. The losses in trading can be very real, and depending on the investment vehicle and market, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. But I do have 15 years of experience in trading and investing in these markets. Airelon's Challenge Chronicles are demo accounts,with all of the inherent problems therein, which are used within this blog in an attempt to track the results of my own thought processes., and is run as a model. Traders who should make their own decisions based off their own research, due diligence, and tolerance for risk. Any pictures used within this blog are believed to be public domain. Any charts that displayed using the ThinkorSwim platform, or any other charting software are believed to be public domain. Any other pictures were obtained through Wikipedia's public domain policy. As a reminder, any trades discussed for "Airelon's Challenge Chronicles" would only be 'day trades' according to the parameters discussed for Airelon's Challenge Chronicles, at this stage of the game in order to escape the risk of over-leveraged gap opens in the commodity futures markets. As a 'trading sister' would have grown to the $30,000 level, I would have graduated the account into 'swing trading'. In addition, it is understood that readers have read my YouTube methodology series. It is also understood that the writer of this blog has repeatedly warned against the dangers of shadowing any other traders thoughts. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research, and tolerance for risk.

The USD/MXN Trade ...

2011-07-13T07:30:00.009-04:00

A few folks had asked to see a chart that chronicles the USD/MXN trade that I journaled yesterday on the blog, Facebook page, and linked Twitter account.

Basically, this started out because I was just curious on the Peso. And then I began to look at the larger time frames. As I mentioned yesterday, I've been picking the brains of a few Forex traders, and one trader in particular. We'll call him "C". "C" has strongly intoned to me that with Forex, it's all about the larger trend. When I saw the larger trend on USD/MXN, I figured I wanted to find an opportunity to be short.

Thus, we come to yesterday morning ...

USD/MXN 10 Minute Chart
(Click to Enlarge)

If you note the twitter feed, I shred off 60% of the position on the first move down somwhere around 11.7812/1. And then, for the rest of the day, I continued to shred off the position, 75 at a time, each time we moved lower.

Actually, I didn't do it as effectively as I liked, because I was still figuring out my way around the Oanda platform, making some simple mistakes. At the end of the trade, I made a mistake of order entry ... but that's why I'm testing this all out beforehand. By 4:00 pm est, when it started moving higher, I had 50 or so left, and made only a few pips on the very last bit. So on the $300.00 level, this would have represented a gain of less than 1%, which is not unusual for my commodity futures trading. On the $50.00 account, this would have represented a gain of about 1% even.

I keep asking "Was it really this simple all along?"

"C" keeps telling me is ... "No if you're a trader it is that easy. If you're not the leverage, the need to be able to trade in both directions and 24 hour (but hidden different sessions) open market will eat you alive."

For now, I am going to keep demo trading it, just to make sure that I have a complete handle on things.

* * *

Note: The above statements should not be construed as an investment or trading recommendation. Airelon's Investing and Trading Journal is a blog that allows subscribers to look 'over my shoulder' as it were, for my own personal specific trading and investing ideas and thoughts for the next week. But they are only thoughts as of the moment of publication, and are subject to change.. Any trades or investments that I discuss within this blog are simply my own thoughts regarding my own investing and trading outlook. Remember that entering any market is an individual decision. There is no guarantee that I will enter, or have entered any of the trading or investing ideas that I discuss in this blog; as larger accounts may require a different strategy as the ones presented here. This blog simply contains my trading and investing thoughts for the next week. I, the author do not grant this work for wide distribution beyond any single individual subscriber as this publication is protected by U.S. And International Copyright laws. All rights reserved. No license is granted to the user except for the user's personal use. No part of this publication or its contents may be copied, downloaded, stored in a retrieval system, further transmitted or otherwise reproduced, stored, disseminated, transferred, or used, in any form or by any means except as permitted under the original subscription agreement or with prior written permission. I personally only enter any market after watching and reading the tape and I trade using money management principles. The losses in trading can be very real, and depending on the investment vehicle and market, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. I do have 15 years of experience in trading and investing in these markets. Airelon's Challenge Chronicles are demo accounts,with all of the inherent problems therein, which are used within this blog in an attempt to track the results of my own thought processes., and is run as a model. Traders who should make their own decisions based off their own research, due diligence, and tolerance for risk. Any pictures used within this blog are believed to be public domain. Any charts that displayed using the ThinkorSwim platform, or any other charting software are believed to be public domain. Any other pictures were obtained through Wikipedia's public domain policy. As a reminder, any trades discussed for "Airelon's Challenge Chronicles" would only be 'day trades' according to the parameters discussed for Airelon's Challenge Chronicles, at this stage of the game in order to escape the risk of over-leveraged gap opens in the commodity futures markets. As a 'trading sister' would have grown to the $30,000 level, I would have graduated the account into 'swing trading'. In addition, it is understood that readers have read my YouTube methodology series. It is also understood that the writer of this blog has repeatedly warned against the dangers of shadowing any other traders thoughts. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research, and tolerance for risk

Forex Trading !

2011-07-12T07:00:00.005-04:00

So I'm taking a look at developing some sort of coherent Forex trading approach. I've already opened a demo Forex account with Oanda, and adjusted the "demo" account to $300.00. I'm not sure if I'll keep this 'model' account at $300.00, or perhaps move it down to $50.00. I'll have to wait and see how my side Forex project plays out ...

Methodology:
I know a few profitable Forex traders, and the thing they keep repeating to me is that ...

Forex trading is all about figuring out how to ride a trend.
Get commodity futures trading out of my head when I go to trade the Forex market. There is no 'zing and zip' as the behavior is such that I might need to pull out from my usual time frames, and look to larger time frames. Again, the theme of 'trend' is repeated.

The sheer number of times I've heard the above statements repeated to me, it seems to me at least at this point, that larger time frame trend alone is the implied bias, probability or 'edge'.

Usually, for commodity futures, I look at the daily chart, the one hour chart, and the ten minute chart. With Forex, I am watching the monthly chart, the weekly, the daily and the four hour chart. I'm entering any trades based on the 30 minute chart.

In commodity futures, when I am dealing with an account over $35,000.00, I 'shred' off multiple contracts as the position becomes more profitable. I will attempt to do the same thing with Forex trading; the main difference is that I will be able to implement this strategy right away.

Contract Lot Sizes
So I worked with the math, and at this point, it seems safer to be using 0.01 lot (1,000) or 0.005 (500) lot sizes for now, which is $0.10 per pip, and $0.05 per pip respectively.

In Practice:
I've already had one practice trade. I was watching the EUR/USD rally on July 7th, and then begin to lose momentum. I went short from 1.43577 on July 7th ...

EUR/USD Last Week
(Can be Enlarged)

The market quickly went flat. And stayed flat until the next session when it began to lose steam and resumed the trend lower. I exited around 1.42669 for a profit of around 99 pips. If we consider a $50.00 account on a .005 lot, then that'd be what ... around $4.95 or a 9.9% rise. The reason I don't like that scenario, is that it means I would have been leveraged 10:1. On a $300.00 account, then I'd still be leveraged, only it would be 1.67:1, which is much more reasonable, and a 1.65% gain. A much more reasonable expectation and gain that would be in line with money management principles.

I also noticed how profitable it would have been to implement a 'shredding off' strategy as far as the size of the position as the trend progressed.

So at this point, I'm getting a feel for leverage, and how I want to customize the lot size for the account itself.

As I was in the trend, I was discussing it with some folks I know, one of which is a pretty active Forex trader.

I've also been looking at a USD/MXN trade on a minor pair. At this point, I'm just watching and observing. I was thinking of trying to find a way to enter on a short. As the market continues to move higher ... I just watch it through the lens of multiple time frames.

Edit: 8:45 AM est - as a matter of fact, I just went short 500 USD/MXN at 1.7902/8. We'll see how it goes.

Edit: 10:14 AM est - And this is why we demo trade, even if we have a ton of other trading experience.

I wanted to shred off 60% of the position around 11.7792/2 - and then let much of the rest ride exactly at 10:00 am est. I was trying to figure out how to do it, and put out some feelers to folks asking questions ... and the market bumped up.

It's no biggie really ... I still like the trade. But I think that highlights the importance of Forex demo trading before you jump into it.

Edit: 11:05 AM est - I held on throught that bump, and sold off 60% of the position when that rally fell apart ... somwhere around 11.7812/1 ... still watching trade, so dont have exact number ...

Edit: 4:00 PM est - By 4:00 pm, I had completely shred off all of the position, bit by bit.

I know I have pre-established skills as a trader, but is it this easy to get the hang of Forex?

* * *

Note: The above statements should not be construed as an investment or trading recommendation. Airelon's Investing and Trading Journal is a blog that allows subscribers to look 'over my shoulder' as it were, for my own personal specific trading and investing ideas and thoughts for the next week. But they are only thoughts as of the moment of publication, and are subject to change.. Any trades or investments that I discuss within this blog are simply my own thoughts regarding my own investing and trading outlook. Remember that entering any market is an individual decision. There is no guarantee that I will enter, or have entered any of the trading or investing ideas that I discuss in this blog; as larger accounts may require a different strategy as the ones presented here. This blog simply contains my trading and investing thoughts for the next week. I, the author do not grant this work for wide distribution beyond any single individual subscriber as this publication is protected by U.S. And International Copyright laws. All rights reserved. No license is granted to the user except for the user's personal use. No part of this publication or its contents may be copied, downloaded, stored in a retrieval system, further transmitted or otherwise reproduced, stored, disseminated, transferred, or used, in any form or by any means except as permitted under the original subscription agreement or with prior written permission. I personally only enter any market after watching and reading the tape and I trade using money management principles. The losses in trading can be very real, and depending on the investment vehicle and market, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. I do have 15 years of experience in trading and investing in these markets. Airelon's Challenge Chronicles are demo accounts,with all of the inherent problems therein, which are used within this blog in an attempt to track the results of my own thought processes., and is run as a model. Traders who should make their own decisions based off their own research, due diligence, and tolerance for risk. Any pictures used within this blog are believed to be public domain. Any charts that displayed using the ThinkorSwim platform, or any other charting software are believed to be public domain. Any other pictures were obtained through Wikipedia's public domain policy. As a reminder, any trades discussed for "Airelon's Challenge Chronicles" would only be 'day trades' according to the parameters discussed for Airelon's Challenge Chronicles, at this stage of the game in order to escape the risk of over-leveraged gap opens in the commodity futures markets. As a 'trading sister' would have grown to the $30,000 level, I would have graduated the account into 'swing trading'. In addition, it is understood that readers have read my YouTube methodology series. It is also understood that the writer of this blog has repeatedly warned against the dangers of shadowing any other traders thoughts. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research, and tolerance for risk

Challenge Project Summary: July 11, 2011

2011-07-11T02:16:00.004-04:00

Previous $500 Challenge Project Balances:

"The Three Sisters":

Investing "Sister" Balance: $1,278.00
Trading "Sister" Balance: $2,394.36
Side-pocket Savings "Sister" Balance: $875.19
Total Challenge Project Funds: $4,484.82

Introduction:
The original video explanation of the Challenge Project that began with $500, is to be found here. If you would like to hear the "why" behind the challenge project, you can find that here as well as here. The Challenge Project is basically a demonstration of a model that anyone could at least follow along with on a weekly basis. It is my attempt without cost, to help out the 'little guy' when it comes to investing and trading by providing an example, a 'model' as it were ... as run by myself as a professional trader with real money, in accounts that I own; following my own three sisters portfolio management system; albeit modified a bit to operate with low funds. From time to time, I provide snapshots of the broker statements.

Rule No. 2 of the Challenge Project states that each month, we can divvy up $100.00 as we wish between the various challenge project accounts. We split up Rule No. 2, into weekly segments; or $25.00 a week. As I mentioned on August 10th, 2010 I have liquidated all of the other personal accounts that I've discussed on this blog for the last 4 years, and to emphasize the strength of these principles? I will demonstrating my success, again, this time it will be live, with the 'Challenge Project', full time.

For this week, the $25.00 weekly deposit is being transferred to the Challenge Project DIVIDEND INVESTING Account.

Rule No. Two:
First of all, as I mentioned in the previous week's entry, applications of rule number two towards either the dividend investing account, or the savings side-pocket account? The cash is being applied towards 'cash reservations' that you see within those accounts ... so that the accounts line up with the previously established 'goals'. So as time passes, you will begin to see that the Challenge Project's Dividend Investing account, as well as Savings Side-Pocket account will align with those goals.

Capital contributions towards dividend investing will help soften any blow from a pullback that we may experience in equities, if the seasonal July 15th downturn in equities holds true this year.

Yield Increase:
It is also important to note that General Mills (GIS) announced a dividend raise some time back. The dividend has increased from $0.28 a share, to $0.305 a share. Our next dividend pay date for this stock is on August 1, 2011.

So ... we have ourselves a little 'raise' so to speak.

And remember that there is no DRIP turned on for the General Mills (GIS) stock. All of that stock is being held at one account, and we are receiving straight cash. All of the cash that I receive at this point on dividends, I place in the category to further D.C.A. that same stock down the road. Thus, a 'synthetic' DRIP is still built.

Forex:
Moving on, I stated in the "Week in Review" podcast that I would discuss how I am going to implement Forex into the Challenge Project. It's important to talk about how I am going to implement it into the portfolio, because after all ... portfolio management is something that I'm really trying to stress as of late.

Ok, at the present time ... we have $2,394.36. That money is set aside so that we can begin to trade in the future. That money will remain dedicated towards trading commodity futures, since that is where the majority of my experience lay.

However, from this point forward, for every application of rule number two ($25.00 a week) that is applied towards the trading account, $5.00 of that capital will go towards a new "Forex Trading" account category, that you will see appear on this blog. In the future, I will also implement Forex into the "Airelon's Challenge Chronicles" accounts in much the same way.

This means that ...

Capital contributions towards the trading account will become more important in terms of frequency. Because all contributions will now be split between two accounts.
There will be real money, set aside for Forex trading, in the very next capital contribution towards the trading account.

I will discuss more of my Forex 'adventures' in upcoming entries ..

Here are the new balances for each of the Challenge Project accounts ...

Challenge Project Balances After Rule No. 2 Deposit:

Goals for Each Account

Investing Account: This Entry describes the next goal. Account is 'active'
Trading Account: $2,600.00
Savings Side-Pocket Account: This Entry describes the next goal. Account is 'active'

Investing Account Balance: $1,304.93
(YTD the account is +27.89 % YTD Return is about +4.784 % )

6.3585 shares of KO ( DRIP is on for 4.3585 shares - Yield is +2.7373 % )
5.2422 shares of JNJ ( DRIP is on for 3.2422 shares - Yield is +3.3743 % )
6 shares of GIS ( DRIP is not on for any shares - Yield is +3.3143 % )
Cash $293.15 ( 22.46 % )

Percentages of that Cash:
-$200.00 of this cash I reserve for 'maneuvering' capital ( 68.22 % )
-$ 19.25 of this cash I reserve to D.C.A. KO ( 6.567 % )
-$ 43.22 of this cash I reserve to D.C.A. JNJ ( 14.74 % )
-$ 20.68 of this cash I reserve to D.C.A. GIS ( 7.054 % )
-This leaves $ 5.00 cash available for a new purchase ( 1.706 % )
-This leaves $ 5.00 cash available for a second new purchase ( 1.706 % )

Additional $218.75 ( 16.76 % ) available from slush fund, up to $1,523.68

Investing Account Balance Year to Date
(Can be Enlarged)

Trading "Sister" Account: $2,394.36
( YTD cash equity up 7.885 % Return on Capital is 0 % )

$2,394.36 set aside for Commodity Futures trading

$0.00 set aside for Forex trading

Trading Account Balance Year to Date
(Can Be Enlarged)

Savings Side-Pocket Balance: $875.29
( YTD cash equity up about 40.05 % Return on Capital is 0.03314 % )

- $0.10 as interest payment for June of 2011

$218.75 for a Slush fund / Draw-down Kill Switch fund
$437.79 for a Base Savings

$218.75 for Emergency Saving

Savings Account Balance Year to Date
(Can Be Enlarged)

- As described in previous entries, all deposits past $675.00 will be towards an interest bearing account, although it separate accounts will still be treated as one 'sister' portion of the book

Total $500 Challenge Project Balance: $4,574.58 ( YTD the account is +18.37 % YTD Return is about +1.326 % )

* * *

Note: The above statements should not be construed as an investment or trading recommendation. Airelon's Investing and Trading Journal is a blog that allows subscribers to look 'over my shoulder' as it were, for my own personal specific trading and investing ideas and thoughts for the next week. But they are only thoughts as of the moment of publication, and are subject to change.. Any trades or investments that I discuss within this blog are simply my own thoughts regarding my own investing and trading outlook. Remember that entering any market is an individual decision. There is no guarantee that I will enter, or have entered any of the trading or investing ideas that I discuss in this blog; as larger accounts may require a different strategy as the ones presented here. This blog simply contains my trading and investing thoughts for the next week. I, the author do not grant this work for wide distribution beyond any single individual subscriber as this publication is protected by U.S. And International Copyright laws. All rights reserved. No license is granted to the user except for the user's personal use. No part of this publication or its contents may be copied, downloaded, stored in a retrieval system, further transmitted or otherwise reproduced, stored, disseminated, transferred, or used, in any form or by any means except as permitted under the original subscription agreement or with prior written permission. I personally only enter any market after watching and reading the tape and I trade using money management principles. The losses in trading can be very real, and depending on the investment vehicle and market, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. I do have 15 years of experience in trading and investing in these markets. Airelon's Challenge Chronicles are demo accounts,with all of the inherent problems therein, which are used within this blog in an attempt to track the results of my own thought processes., and is run as a model. Traders who should make their own decisions based off their own research, due diligence, and tolerance for risk. Any pictures used within this blog are believed to be public domain. Any charts that displayed using the ThinkorSwim platform, or any other charting software are believed to be public domain. Any other pictures were obtained through Wikipedia's public domain policy. As a reminder, any trades discussed for "Airelon's Challenge Chronicles" would only be 'day trades' according to the parameters discussed for Airelon's Challenge Chronicles, at this stage of the game in order to escape the risk of over-leveraged gap opens in the commodity futures markets. As a 'trading sister' would have grown to the $30,000 level, I would have graduated the account into 'swing trading'. In addition, it is understood that readers have read my YouTube methodology series. It is also understood that the writer of this blog has repeatedly warned against the dangers of shadowing any other traders thoughts. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research, and tolerance for risk

Week in Review: Blogging Evolution, Commentary, Forex and Base Principles (PODCAST and VIDEO)

2011-07-09T20:15:00.010-04:00

"Adapt or Die" - Personal Mantra

Welcome to the Week in Week in Review podcast!

In this week in review, I review all of the markets, my thoughts, the continuing evolution of this blog, as well as my recent A.C.C. entry "Adapt or Die".

(Podcast Included. If you're seeing this entry elsewhere and cannot play the podcast? Click this link to go to the exact podcast entry ...)

Podcast Powered By Podbean

Click here to download this podcast.

I have also included a video of this podcast at youtube that includes graphs of the chats as I discuss them ...

(Video Included. If you're seeing this entry elsewhere and cannot see the Video? Click this link to view the entry ...)

Here is the blip.tv version of the video.

* * *

Note: The above statements should not be construed as an investment or trading recommendation. Airelon's Investing and Trading Journal is a blog that allows subscribers to look 'over my shoulder' as it were, for my own personal specific trading and investing ideas and thoughts for the next week. But they are only thoughts as of the moment of publication, and are subject to change.. Any trades or investments that I discuss within this blog are simply my own thoughts regarding my own investing and trading outlook. Remember that entering any market is an individual decision. There is no guarantee that I will enter, or have entered any of the trading or investing ideas that I discuss in this blog; as larger accounts may require a different strategy as the ones presented here. This blog simply contains my trading and investing thoughts for the next week. I, the author do not grant this work for wide distribution beyond any single individual subscriber as this publication is protected by U.S. And International Copyright laws. All rights reserved. No license is granted to the user except for the user's personal use. No part of this publication or its contents may be copied, downloaded, stored in a retrieval system, further transmitted or otherwise reproduced, stored, disseminated, transferred, or used, in any form or by any means except as permitted under the original subscription agreement or with prior written permission. I personally only enter any market after watching and reading the tape and I trade using money management principles. The losses in trading can be very real, and depending on the investment vehicle and market, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. But I do have 15 years of experience in trading and investing in these markets. Airelon's Challenge Chronicles are demo accounts,with all of the inherent problems therein, which are used within this blog in an attempt to track the results of my own thought processes., and is run as a model. Traders who should make their own decisions based off their own research, due diligence, and tolerance for risk. Any pictures used within this blog are believed to be public domain. Any charts that displayed using the ThinkorSwim platform, or any other charting software are believed to be public domain. Any other pictures were obtained through Wikipedia's public domain policy. As a reminder, any trades discussed for "Airelon's Challenge Chronicles" would only be 'day trades' according to the parameters discussed for Airelon's Challenge Chronicles, at this stage of the game in order to escape the risk of over-leveraged gap opens in the commodity futures markets. As a 'trading sister' would have grown to the $30,000 level, I would have graduated the account into 'swing trading'. In addition, it is understood that readers have read my YouTube methodology series. It is also understood that the writer of this blog has repeatedly warned against the dangers of shadowing any other traders thoughts. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research, and tolerance for risk.

Airelon's Challenge Chronicles 25: Adapt or Die

2011-07-06T12:07:00.013-04:00

So what is "Airelon's Challenge Chronicles"? You can find a description by clicking here.

For the month of July, 2011, all of rule no. two has already been applied TRADING account.

I have often stated (in fact, I did so in yesterday's podcast), that the capital markets are like an extreme 'survivalist arena'. And believe it or not, as often as I will rail against the "doom and gloom" crowd that finds perverse pleasure in the idea that others will suffer in some sort of disaster scenario ... I do enjoy learning about survival techniques. Because I enjoy the concept of self-sufficiency.

A survival instructor that I am somewhat fond of following enjoys quoting the unofficial United States Marine Corps mantra: "Improvise, Adapt and Overcome". It is believed that the origin of this mantra lay in the history of the Marine Corps. When forced to use poor equipment, Marines would creatively discover new ways to work with what they had on hand. It has been called a 'success-based attitude'.

You work with what you have in order to overcome.

The capital markets are no different. Back in 1998 when I followed Larry Williams, something he would often repeat, is the need to be disciplined, yet flexible and understand the difference. He would stress that the markets were frequently in flux and ever-changing. That a successful trader needed to adapt and overcome to such changes. When I was following Larry's material, he would talk about the great changes that the Index Futures presented to the markets (there was a time, where we did not have the index futures as they exist today). I really didn't understand that change. When I began, the index futures markets had always been present. But he traded during that time, and observed that change as it occurred and the effect that it had on trading and the markets overall, and he would often discuss that change.

Today, it's much the same. When I began? There was no broad based Forex market as it exists today. Sure, some traders could trade a currency cross. But 'retail' had little to zero access to those markets. There was no 'computer based' trading. I often related how all charts were drawn on paper with rulers, pencils and calculators. Discount brokers were the rare. Full service brokers would charge $35.00 in, $35.00 out. The only day traders were really the guys in the pits, which have now almost completely disappeared. I would almost argue that we live in 'the age of the retail trader'.

Now let's bring the above concepts together. A good trader knows how to improvise, adapt and overcome; while at the same time, remaining flexible to changing market conditions, or conditions of his own account and money management metrics. This leads us to "Airelon's Challenge Chronicles".

I have a positive trading yield at the moment. Off of an initial tiny amount of $2,607.82 on January 1st of this year? I have managed a pure yield, not counting capital additions, of 5.465%. That yield offers some chance to reflect on the 'perspective' that I have discussed lately. 5.465% for six months is absolutely fantastic, when you look at it from the lens of returns that you can receive institutions. For my own trading career? It's one of my worst trading years. Of course, that's said with the understanding that I've managed 5.465% off of only $2,607.82.

Yet a flaw has been revealed with what I am trying to do; namely ... there is an extreme temptation to trade markets that I should not yet be trading, since the account is so small. Even with day trades those are some pretty leveraged positions. The ATR of each of my usual time-frames have been killing me, and my money management numbers are telling the story of this drift with the increase in drawdown. A danger lay there. If the trend continues, then mathematically, despite a high degree of accuracy ... I could end the account in ruin.

So how do I "Improvise, Adapt and Overcome"?

Good question. I'm still mulling on that one. For the actual Challenge Project, since the "dividend investing sister" account and the "savings side-pocket sister" account have 'graduated' to 'live', and following yesterday's comments, I may focus a bit on the dividend investing account, as well as the savings side-pocket accounts when it comes to rule number two for the actual Challenge Project. That is not to say that I will not fund the trading account at all. After all, if I'm going to once again reach those 80% years ... then it has to be funded. But I suppose it is fair to say that "Airelon's Challenge Chronicles" has provided some illumination to dangers and risks that I had perhaps 'glossed over' previously. So modestly, humbly, I must recognize my limitations, and adapt.

In addition, I am going to more seriously take a look at the Forex market. I do not want to 'style-drift'. But this has less to do with 'style-drifting', and more to do with keeping up on my own 'continual education' for my vocation of a professional trader and investor in the capital markets. I will share my 'continual education' here on the blog.

For right now? I have no trades for "Airelon's Challenge Chronicles".

As follows is a summary of the "Challenge Chronicle" 'Three Sister' accounts as of this entry ...

Investing "Sister" Account: Will no longer make Rule No. Two Deposits to this Account. Challenge Project Investing Account is Active. I will continue to track this account so as to mark progress of previous decisions.

Investing "Sister" Account: $1,579.62
( YTD the account is +13.88 % Return on Capital YTD is +5.508 % )

6.3585 shares of KO ( DRIP is on for 4.3585 shares - Yield is +2.7401 % )

- 0.0302 shares accumulated in DRIP on 7/1/2011 at $67.218
-$0.94 cash in cash dividend from Coca-Cola (KO) at other account

5.2422 shares of JNJ ( DRIP is on for 3.2422 shares - Yield is +3.3723 % )
10.15282 shares of GIS ( DRIP on for 10.15282 share - Yield is +3.7841 % )
Cash $390.81 ( 24.74 % )

Percentages of that Cash:
- $200.00 of this cash I reserve for 'maneuvering' capital ( 51.18 % )
- $ 45.94 of this cash I reserve to D.C.A. KO ( 11.76 % )
- $ 79.14 of this cash I reserve to D.C.A. JNJ ( 20.25 % )
- $ 31.98 of this cash I reserve to D.C.A. GIS ( 8.183 % )
- This leaves $23.75 cash available for a new purchase ( 6.077 % )
- This leaves $10.00 cash available for a second new purchase ( 2.559 % )

Additional $243.75 ( 15.7 % ) available from slush fund, up to $1,823.37

Trading "Sister" Account: $3,293.47

( YTD the account is +26.29 % True Return on Capital YTD is +5.465 % )

2% risk tolerance gives us $65.86 'at risk' levels
3% risk tolerance gives us $98.80 'at risk' levels
Additional $243.75 available from draw-down / slush fund, to $3,537.22

Savings Side-Pocket Balance: Will no longer make Rule No. Two Deposits to this Account. Challenge Project Savings Side-Pocket is Active. I will continue to track this account so as to mark progress of previous decisions.

Savings Side-Pocket Balance: $975.41

(YTD cash equity up about 8.379 % Return on Capital is 0.04205 %)

-$0.07 Interest Paid for the month of June

$243.75 for a Slush fund / Draw-down Kill Switch fund
$487.91 for a Base Savings

Percentages of that Cash:
-$401.91 of this cash I reserve for 'burn rate / maneuvering' capital ( 82.37 %)
-$ 59.00 of this cash I reserve for CD Ladder creation ( 12.09 % )
-$ 10.00 of this cash I reserve for the first side-pocket purchase ( 2.05 %)
-$ 10.00 of this cash I reserve for the second side-pocket purchase ( 2.05 %)
-$ 7.00 of this cash I reserve for the hedging account ( 1.435 %)

$243.75 for Emergency Savings

-$731.66 of this cash is in an interest bearing account.
-$243.75 remains at the brokerage in an account for draw-down

Total Airelon's Challenge Chronicles Balance: $5,848.50 ( YTD the account is +19.48 % Return on Capital YTD is +4.531 % )

And once again, here are the money management performance metrics as they exist ...

* * *

Note: The above statements should not be construed as an investment or trading recommendation. Airelon's Investing and Trading Journal is a blog that allows subscribers to look 'over my shoulder' as it were, for my own personal specific trading and investing ideas and thoughts for the next week. But they are only thoughts as of the moment of publication, and are subject to change.. Any trades or investments that I discuss within this blog are simply my own thoughts regarding my own investing and trading outlook. Remember that entering any market is an individual decision. There is no guarantee that I will enter, or have entered any of the trading or investing ideas that I discuss in this blog; as larger accounts may require a different strategy as the ones presented here. This blog simply contains my trading and investing thoughts for the next week. I, the author do not grant this work for wide distribution beyond any single individual subscriber as this publication is protected by U.S. And International Copyright laws. All rights reserved. No license is granted to the user except for the user's personal use. No part of this publication or its contents may be copied, downloaded, stored in a retrieval system, further transmitted or otherwise reproduced, stored, disseminated, transferred, or used, in any form or by any means except as permitted under the original subscription agreement or with prior written permission. I personally only enter any market after watching and reading the tape and I trade using money management principles. The losses in trading can be very real, and depending on the investment vehicle and market, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. I do have 15 years of experience in trading and investing in these markets. Airelon's Challenge Chronicles are demo accounts,with all of the inherent problems therein, which are used within this blog in an attempt to track the results of my own thought processes., and is run as a model. Traders who should make their own decisions based off their own research, due diligence, and tolerance for risk. Any pictures used within this blog are believed to be public domain. Any charts that displayed using the ThinkorSwim platform, or any other charting software are believed to be public domain. Any other pictures were obtained through Wikipedia's public domain policy. As a reminder, any trades discussed for "Airelon's Challenge Chronicles" would only be 'day trades' according to the parameters discussed for Airelon's Challenge Chronicles, at this stage of the game in order to escape the risk of over-leveraged gap opens in the commodity futures markets. As a 'trading sister' would have grown to the $30,000 level, I would have graduated the account into 'swing trading'. In addition, it is understood that readers have read my YouTube methodology series. It is also understood that the writer of this blog has repeatedly warned against the dangers of shadowing any other traders thoughts. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research, and tolerance for risk.

Challenge Project Summary: July 5, 2011 (PODCAST and VIDEO)

2011-07-05T11:00:00.008-04:00

Previous $500 Challenge Project Balances:

"The Three Sisters":

Investing "Sister" Balance: $1,240.27
Trading "Sister" Balance: $2,394.36
Side-pocket Savings "Sister" Balance: $850.19
Total Challenge Project Funds: $4,484.82

Introduction:
The original video explanation of the Challenge Project that began with $500, is to be found here. If you would like to hear the "why" behind the challenge project, you can find that here as well as here. The Challenge Project is basically a demonstration of a model that anyone could at least follow along with on a weekly basis. It is my attempt without cost, to help out the 'little guy' when it comes to investing and trading by providing an example, a 'model' as it were ... as run by myself as a professional trader with real money, in accounts that I own; following my own three sisters portfolio management system; albeit modified a bit to operate with low funds. From time to time, I provide snapshots of the broker statements.

Rule No. 2 of the Challenge Project states that each month, we can divvy up $100.00 as we wish between the various challenge project accounts. We split up Rule No. 2, into weekly segments; or $25.00 a week. As I mentioned on August 10th, 2010 I have liquidated all of the other personal accounts that I've discussed on this blog for the last 4 years, and to emphasize the strength of these principles? I will demonstrating my success, again, this time it will be live, with the 'Challenge Project', full time.

For this week, the $25.00 weekly deposit is being transferred to the Challenge Project SAVING SIDE-POCKET Account.

After speaking to what I've been busy doing? In this week's Challenge Project podcast I want to address to comments / questions that lambdog76 raised on last weeks Challenge Project entry in regards to:

1) What would I have done differently with the Challenge Project and ...

2) What differences will you see with my move?

(Podcast Included. If you're seeing this entry elsewhere and cannot play the podcast? Click this link to go to the exact podcast entry ...)

Podcast Powered By Podbean

Click here to download this podcast.

I have also included a video of this podcast at youtube ...

(Video Included. If you're seeing this entry elsewhere and cannot see the Video? Click this link to view the entry ...)

Here is the blip.tv version of the video.

Please note that the cash that was added to the savings side-pocket? I primarily added to the cash reservation that is set aside for burn rate.

Here are the new balances for each of the Challenge Project accounts ...

Challenge Project Balances After Rule No. 2 Deposit:

Goals for Each Account

Investing Account: This Entry describes the next goal. Account is 'active'
Trading Account: $2,600.00
Savings Side-Pocket Account: This Entry describes the next goal. Account is 'active'

Investing Account Balance: $1,278.00
(YTD the account is +25.25 % YTD Return is about +4.724 % )

6.3585 shares of KO ( DRIP is on for 4.3585 shares - Yield is +2.7611 % )

- 0.0302 shares accumulated in DRIP on 7/1/2011 at $67.218
-$0.94 cash in cash dividend from Coca-Cola (KO) at other account

5.2422 shares of JNJ ( DRIP is on for 3.2422 shares - Yield is +3.3878 % )
6 shares of GIS ( DRIP is not on for any shares - Yield is +2.9987 % )
Cash $268.15 ( 20.98 % )

Percentages of that Cash:
-$175.37 of this cash I reserve for 'maneuvering' capital ( 13.72 % )
-$ 18.88 of this cash I reserve to D.C.A. KO ( 1.477 % )
-$ 43.22 of this cash I reserve to D.C.A. JNJ ( 3.382 % )
-$ 20.68 of this cash I reserve to D.C.A. GIS ( 1.618 % )
-This leaves $ 5.00 cash available for a new purchase ( 0.3912 % )
-This leaves $ 5.00 cash available for a second new purchase ( 0.3912 % )

Additional $218.75 ( 17.12 % ) available from slush fund, up to $1,496.75

Investing Account Balance Year to Date
(Can be Enlarged)

Trading "Sister" Account: $2,394.36
( YTD cash equity up 7.885 % Return on Capital is 0 % )

2% risk tolerance gives us $47.88 'at risk' levels
3% risk tolerance gives us $71.83 'at risk' levels
Additional $218.75 available from draw-down / slush fund, to $2,613.11

Trading Account Balance Year to Date
(Can Be Enlarged)

Savings Side-Pocket Balance: $875.29
( YTD cash equity up about 40.05 % Return on Capital is 0.03314 % )

- $0.10 as interest payment for June of 2011

$218.75 for a Slush fund / Draw-down Kill Switch fund
$437.79 for a Base Savings

$218.75 for Emergency Saving

Savings Account Balance Year to Date
(Can Be Enlarged)

- As described in previous entries, all deposits past $675.00 will be towards an interest bearing account, although it separate accounts will still be treated as one 'sister' portion of the book

Total $500 Challenge Project Balance: $4,547.65 ( YTD the account is +17.67 % YTD Return is about +1.2910 % )

* * *

Note: The above statements should not be construed as an investment or trading recommendation. Airelon's Investing and Trading Journal is a blog that allows subscribers to look 'over my shoulder' as it were, for my own personal specific trading and investing ideas and thoughts for the next week. But they are only thoughts as of the moment of publication, and are subject to change.. Any trades or investments that I discuss within this blog are simply my own thoughts regarding my own investing and trading outlook. Remember that entering any market is an individual decision. There is no guarantee that I will enter, or have entered any of the trading or investing ideas that I discuss in this blog; as larger accounts may require a different strategy as the ones presented here. This blog simply contains my trading and investing thoughts for the next week. I, the author do not grant this work for wide distribution beyond any single individual subscriber as this publication is protected by U.S. And International Copyright laws. All rights reserved. No license is granted to the user except for the user's personal use. No part of this publication or its contents may be copied, downloaded, stored in a retrieval system, further transmitted or otherwise reproduced, stored, disseminated, transferred, or used, in any form or by any means except as permitted under the original subscription agreement or with prior written permission. I personally only enter any market after watching and reading the tape and I trade using money management principles. The losses in trading can be very real, and depending on the investment vehicle and market, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. I do have 15 years of experience in trading and investing in these markets. Airelon's Challenge Chronicles are demo accounts,with all of the inherent problems therein, which are used within this blog in an attempt to track the results of my own thought processes., and is run as a model. Traders who should make their own decisions based off their own research, due diligence, and tolerance for risk. Any pictures used within this blog are believed to be public domain. Any charts that displayed using the ThinkorSwim platform, or any other charting software are believed to be public domain. Any other pictures were obtained through Wikipedia's public domain policy. As a reminder, any trades discussed for "Airelon's Challenge Chronicles" would only be 'day trades' according to the parameters discussed for Airelon's Challenge Chronicles, at this stage of the game in order to escape the risk of over-leveraged gap opens in the commodity futures markets. As a 'trading sister' would have grown to the $30,000 level, I would have graduated the account into 'swing trading'. In addition, it is understood that readers have read my YouTube methodology series. It is also understood that the writer of this blog has repeatedly warned against the dangers of shadowing any other traders thoughts. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research, and tolerance for risk

I'm Still Here ...

2011-07-01T16:59:00.005-04:00

I'm still around. I've just been busy with organizing for the move, visiting with friends and family that we may not see for a while.

There was a dividend paid Friday with Coca-Cola (KO). I'll have the numbers in the next A.C.C. entry, as well as the next 'Challenge Project' summary.

Speaking of A.C.C., just so I am clear, obviously rule number two is being applied towards the trading account for the entire month of July ...

* * *

Note: The above statements should not be construed as an investment or trading recommendation. Airelon's Investing and Trading Journal is a blog that allows subscribers to look 'over my shoulder' as it were, for my own personal specific trading and investing ideas and thoughts for the next week. But they are only thoughts as of the moment of publication, and are subject to change.. Any trades or investments that I discuss within this blog are simply my own thoughts regarding my own investing and trading outlook. Remember that entering any market is an individual decision. There is no guarantee that I will enter, or have entered any of the trading or investing ideas that I discuss in this blog; as larger accounts may require a different strategy as the ones presented here. This blog simply contains my trading and investing thoughts for the next week. I, the author do not grant this work for wide distribution beyond any single individual subscriber as this publication is protected by U.S. And International Copyright laws. All rights reserved. No license is granted to the user except for the user's personal use. No part of this publication or its contents may be copied, downloaded, stored in a retrieval system, further transmitted or otherwise reproduced, stored, disseminated, transferred, or used, in any form or by any means except as permitted under the original subscription agreement or with prior written permission. I personally only enter any market after watching and reading the tape and I trade using money management principles. The losses in trading can be very real, and depending on the investment vehicle and market, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. I do have 15 years of experience in trading and investing in these markets. Airelon's Challenge Chronicles are demo accounts,with all of the inherent problems therein, which are used within this blog in an attempt to track the results of my own thought processes., and is run as a model. Traders who should make their own decisions based off their own research, due diligence, and tolerance for risk. Any pictures used within this blog are believed to be public domain. Any charts that displayed using the ThinkorSwim platform, or any other charting software are believed to be public domain. Any other pictures were obtained through Wikipedia's public domain policy. As a reminder, any trades discussed for "Airelon's Challenge Chronicles" would only be 'day trades' according to the parameters discussed for Airelon's Challenge Chronicles, at this stage of the game in order to escape the risk of over-leveraged gap opens in the commodity futures markets. As a 'trading sister' would have grown to the $30,000 level, I would have graduated the account into 'swing trading'. In addition, it is understood that readers have read my YouTube methodology series. It is also understood that the writer of this blog has repeatedly warned against the dangers of shadowing any other traders thoughts. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research, and tolerance for risk.

Charting 101 (Series): Workstations ... Simple and Peaceful (Remake VIDEO)

2011-06-30T10:35:00.005-04:00

"Simplicity is the ultimate sophistication." - Leonardo da Vinci

Most of my entries, videos and podcasts discuss things like "Emotional Discipline" or "Money Management" or "Portfolio Management". But at a certain point? You have to know the nuts and bolts behind a chart. This video is actually a remake video to a video playlist, or series of videos that I had over 3 years ago on "Charting 101".

But before we get to the charts? I want to take some time out and discuss the workstation at which I examine my charts ...

(Video Included. If you're seeing this entry elsewhere and cannot see the Video? Click this link to view the entry ...)

Here is the blip.tv version of the video.

* * *

Note: The above statements should not be construed as an investment or trading recommendation. Airelon's Investing and Trading Journal is a blog that allows subscribers to look 'over my shoulder' as it were, for my own personal specific trading and investing ideas and thoughts for the next week. But they are only thoughts as of the moment of publication, and are subject to change.. Any trades or investments that I discuss within this blog are simply my own thoughts regarding my own investing and trading outlook. Remember that entering any market is an individual decision. There is no guarantee that I will enter, or have entered any of the trading or investing ideas that I discuss in this blog; as larger accounts may require a different strategy as the ones presented here. This blog simply contains my trading and investing thoughts for the next week. I, the author do not grant this work for wide distribution beyond any single individual subscriber as this publication is protected by U.S. And International Copyright laws. All rights reserved. No license is granted to the user except for the user's personal use. No part of this publication or its contents may be copied, downloaded, stored in a retrieval system, further transmitted or otherwise reproduced, stored, disseminated, transferred, or used, in any form or by any means except as permitted under the original subscription agreement or with prior written permission. I personally only enter any market after watching and reading the tape and I trade using money management principles. The losses in trading can be very real, and depending on the investment vehicle and market, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. I do have 15 years of experience in trading and investing in these markets. Airelon's Challenge Chronicles are demo accounts,with all of the inherent problems therein, which are used within this blog in an attempt to track the results of my own thought processes., and is run as a model. Traders who should make their own decisions based off their own research, due diligence, and tolerance for risk. Any pictures used within this blog are believed to be public domain. Any charts that displayed using the ThinkorSwim platform, or any other charting software are believed to be public domain. Any other pictures were obtained through Wikipedia's public domain policy. As a reminder, any trades discussed for "Airelon's Challenge Chronicles" would only be 'day trades' according to the parameters discussed for Airelon's Challenge Chronicles, at this stage of the game in order to escape the risk of over-leveraged gap opens in the commodity futures markets. As a 'trading sister' would have grown to the $30,000 level, I would have graduated the account into 'swing trading'. In addition, it is understood that readers have read my YouTube methodology series. It is also understood that the writer of this blog has repeatedly warned against the dangers of shadowing any other traders thoughts. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research, and tolerance for risk.

Monday Challenge Project Summary: June 27, 2011 (PODCAST)

2011-06-27T13:20:00.001-04:00

Previous $500 Challenge Project Balances:

"The Three Sisters":

Investing "Sister" Balance: $1,257.68
Trading "Sister" Balance: $2,394.36
Side-pocket Savings "Sister" Balance: $825.19
Total Challenge Project Funds: $4,477.23

Introduction:
The original video explanation of the Challenge Project that began with $500, is to be found here. If you would like to hear the "why" behind the challenge project, you can find that here as well as here. The Challenge Project is basically a demonstration of a model that anyone could at least follow along with on a weekly basis. It is my attempt without cost, to help out the 'little guy' when it comes to investing and trading by providing an example, a 'model' as it were ... as run by myself as a professional trader with real money, in accounts that I own; following my own three sisters portfolio management system; albeit modified a bit to operate with low funds. From time to time, I provide snapshots of the broker statements.

Rule No. 2 of the Challenge Project states that each month, we can divvy up $100.00 as we wish between the various challenge project accounts. We split up Rule No. 2, into weekly segments; or $25.00 a week. As I mentioned on August 10th, 2010 I have liquidated all of the other personal accounts that I've discussed on this blog for the last 4 years, and to emphasize the strength of these principles? I will demonstrating my success, again, this time it will be live, with the 'Challenge Project', full time.

For this week, the $25.00 weekly deposit is being transferred to the Challenge Project SAVING SIDE-POCKET Account.

In this week's Challenge Project Entry, I am going to include a podcast that is sort of the "State of the Challenge Project". I go through each account, state the positives, and what needs more work. I conclude with comments on my own psychology and discipline in regards this project of mine ....

(Podcast Included. If you're seeing this entry elsewhere and cannot play the podcast? Click this link to go to the exact podcast entry ...)

Podcast Powered By Podbean

Click here to download this podcast.

Here are the new balances for each of the Challenge Project accounts ...

Challenge Project Balances After Rule No. 2 Deposit:

Goals for Each Account

Investing Account: This Entry describes the next goal. Account is 'active'
Trading Account: $2,600.00
Savings Side-Pocket Account: This Entry describes the next goal. Account is 'active'

Investing Account Balance: $1,240.27
(YTD the account is +21.55 % YTD Return is about +1.632 % )

6.3283 shares of KO ( DRIP is on for 4.3283 shares - Yield is +2.8954 % )
5.2422 shares of JNJ ( DRIP is on for 3.2422 shares - Yield is +3.5045 % )
6 shares of GIS ( DRIP is not on for any shares - Yield is +3.0393 % )
Cash $267.21 ( 21.54 % )

Percentages of that Cash:
-$175.37 of this cash I reserve for 'maneuvering' capital ( 14.14 % )
-$ 17.94 of this cash I reserve to D.C.A. KO ( 1.45 % )
-$ 43.22 of this cash I reserve to D.C.A. JNJ ( 3.48 % )
-$ 20.68 of this cash I reserve to D.C.A. GIS ( 1.67 % )
-This leaves $ 5.00 cash available for a new purchase ( 0.40 % )
-This leaves $ 5.00 cash available for a second new purchase ( 0.40 % )

Additional $212.50 ( 17.13 % ) available from slush fund, up to $1,452.77

Investing Account Balance Year to Date
(Can be Enlarged)

Trading "Sister" Account: $2,394.36
( YTD cash equity up 7.885 % Return on Capital is 0 % )

2% risk tolerance gives us $47.88 'at risk' levels
3% risk tolerance gives us $71.83 'at risk' levels
Additional $212.50 available from draw-down / slush fund, to $2,606.86

Trading Account Balance Year to Date
(Can Be Enlarged)

Savings Side-Pocket Balance: $850.19
(YTD cash equity up about 36.03 % Return on Capital is 0.2235 % )

$212.50 for a Slush fund / Draw-down Kill Switch fund
$425.19 for a Base Savings

-$339.19 of this cash I reserve for 'burn rate / maneuvering' capital ( 39.9 %)
-$ 59.00 of this cash I reserve for CD Ladder creation ( 6.94 % )
-$ 10.00 of this cash I reserve for the first side-pocket purchase ( 1.176 % )
-$ 10.00 of this cash I reserve for the second side-pocket purchase ( 1.176 % )
-$ 7.00 of this cash I reserve for the hedging account ( 0.8233 %)

$212.50 for Emergency Saving

Savings Account Balance Year to Date
(Can Be Enlarged)

- As described in previous entries, all deposits past $675.00 will be towards an interest bearing account, although it separate accounts will still be treated as one 'sister' portion of the book

Total $500 Challenge Project Balance: $4,484.82 ( YTD the account is +16.05 % YTD Return is about +0.4504 % )

* * *

Note: The above statements should not be construed as an investment or trading recommendation. Airelon's Investing and Trading Journal is a blog that allows subscribers to look 'over my shoulder' as it were, for my own personal specific trading and investing ideas and thoughts for the next week. But they are only thoughts as of the moment of publication, and are subject to change.. Any trades or investments that I discuss within this blog are simply my own thoughts regarding my own investing and trading outlook. Remember that entering any market is an individual decision. There is no guarantee that I will enter, or have entered any of the trading or investing ideas that I discuss in this blog; as larger accounts may require a different strategy as the ones presented here. This blog simply contains my trading and investing thoughts for the next week. I, the author do not grant this work for wide distribution beyond any single individual subscriber as this publication is protected by U.S. And International Copyright laws. All rights reserved. No license is granted to the user except for the user's personal use. No part of this publication or its contents may be copied, downloaded, stored in a retrieval system, further transmitted or otherwise reproduced, stored, disseminated, transferred, or used, in any form or by any means except as permitted under the original subscription agreement or with prior written permission. I personally only enter any market after watching and reading the tape and I trade using money management principles. The losses in trading can be very real, and depending on the investment vehicle and market, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. I do have 15 years of experience in trading and investing in these markets. Airelon's Challenge Chronicles are demo accounts,with all of the inherent problems therein, which are used within this blog in an attempt to track the results of my own thought processes., and is run as a model. Traders who should make their own decisions based off their own research, due diligence, and tolerance for risk. Any pictures used within this blog are believed to be public domain. Any charts that displayed using the ThinkorSwim platform, or any other charting software are believed to be public domain. Any other pictures were obtained through Wikipedia's public domain policy. As a reminder, any trades discussed for "Airelon's Challenge Chronicles" would only be 'day trades' according to the parameters discussed for Airelon's Challenge Chronicles, at this stage of the game in order to escape the risk of over-leveraged gap opens in the commodity futures markets. As a 'trading sister' would have grown to the $30,000 level, I would have graduated the account into 'swing trading'. In addition, it is understood that readers have read my YouTube methodology series. It is also understood that the writer of this blog has repeatedly warned against the dangers of shadowing any other traders thoughts. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research, and tolerance for risk

Airelon's Challenge Chronicles No. 24

2011-06-26T19:21:00.013-04:00

So what is "Airelon's Challenge Chronicles"? You can find a description by clicking here.

For the month of June, 2011, all of rule no. two has already been applied TRADING account.

To be honest?

I haven't had a chance at all this weekend to look at the markets, charts, news, seasonal metrics or C.o.T. data.

So to put out a A.C.C. entry based on 'rushed' research ... well ... that's no way for me to trade and invest. In addition, I think it's important to 'share' that idea. At times, professional traders and investors, just like everyone else ... get a little behind in their schedule.

However I will say that this Sunday evening, the points that I will be researching in the next 48 hours?

Equity Markets: The charts, company news of the companies that I hold in the portfolio, seasonal metrics as opposed to how the market has performed recently
Commodity Markets: Are there any possible trades? Again, to see how I personally do this? I would refer ones to my 'methodology' series.
Savings Side-Pockets: Although A.C.C. itself has 'graduated' the dividend investing account and the 'savings side-pocket' to 'live' accounts? I have been intending to research how I want to implement a) constructing a small CD ladder for the actual challenge project and b) any possible side-pocket markets that I can begin to examine for purchases.

In short? There is a lot to research. At some point in the next 48 hours, I have to sit down, and research each of these points. I'll try to do so with a video, or perhaps a podcast for tomorrow's "Challenge Project" entry.

As follows is a summary of the "Challenge Chronicle" 'Three Sister' accounts as of this entry ...

Investing "Sister" Account: Will no longer make Rule No. Two Deposits to this Account. Challenge Project Investing Account is Active. I will continue to track this account so as to mark progress of previous decisions.

Investing "Sister" Account: $1,535.30
( YTD the account is +10.68 % Return on Capital YTD is +2.548 % )

6.3283 shares of KO ( DRIP is on for 4.3283 shares - Yield is +2.8954 % )
5.2422 shares of JNJ ( DRIP is on for 3.2422 shares - Yield is +3.5045 % )
10.15282 shares of GIS ( DRIP on for 10.15282 share - Yield is +3.0393 % )
Cash $389.87 ( 25.39 % )

Percentages of that Cash:
- $200.00 of this cash I reserve for 'maneuvering' capital ( 51.3 % )
- $ 45.00 of this cash I reserve to D.C.A. KO ( 11.54 % )
- $ 79.14 of this cash I reserve to D.C.A. JNJ ( 20.3 % )
- $ 31.98 of this cash I reserve to D.C.A. GIS ( 8.203 % )
- This leaves $23.75 cash available for a new purchase ( 6.092 % )
- This leaves $10.00 cash available for a second new purchase ( 2.565 % )

Additional $243.75 ( 15.7 % ) available from slush fund, up to $1,796.53

Trading "Sister" Account: $3,193.47

( YTD the account is +22.46 % True Return on Capital YTD is +5.645 % )

2% risk tolerance gives us $63.86 'at risk' levels
3% risk tolerance gives us $95.80 'at risk' levels
Additional $243.75 available from draw-down / slush fund, to $3,437.22

(YTD cash equity up about 8.371 % Return on Capital is 0.03487 %)

$243.75 for a Slush fund / Draw-down Kill Switch fund
$487.84 for a Base Savings

Percentages of that Cash:
-$401.84 of this cash I reserve for 'burn rate / maneuvering' capital ( 82.37 %)
-$ 59.00 of this cash I reserve for CD Ladder creation ( 12.09 % )
-$ 10.00 of this cash I reserve for the first side-pocket purchase ( 2.05 %)
-$ 10.00 of this cash I reserve for the second side-pocket purchase ( 2.05 %)
-$ 7.00 of this cash I reserve for the hedging account ( 1.435 %)

$243.75 for Emergency Savings

-$731.59 of this cash is in an interest bearing account.
-$243.75 remains at the brokerage in an account for draw-down

Total Airelon's Challenge Chronicles Balance: $5,704.11 ( YTD the account is +16.53 % Return on Capital YTD is +3.806 % )

And once again, here are the money management performance metrics as they exist ...

* * *

Note: The above statements should not be construed as an investment or trading recommendation. Airelon's Investing and Trading Journal is a blog that allows subscribers to look 'over my shoulder' as it were, for my own personal specific trading and investing ideas and thoughts for the next week. But they are only thoughts as of the moment of publication, and are subject to change.. Any trades or investments that I discuss within this blog are simply my own thoughts regarding my own investing and trading outlook. Remember that entering any market is an individual decision. There is no guarantee that I will enter, or have entered any of the trading or investing ideas that I discuss in this blog; as larger accounts may require a different strategy as the ones presented here. This blog simply contains my trading and investing thoughts for the next week. I, the author do not grant this work for wide distribution beyond any single individual subscriber as this publication is protected by U.S. And International Copyright laws. All rights reserved. No license is granted to the user except for the user's personal use. No part of this publication or its contents may be copied, downloaded, stored in a retrieval system, further transmitted or otherwise reproduced, stored, disseminated, transferred, or used, in any form or by any means except as permitted under the original subscription agreement or with prior written permission. I personally only enter any market after watching and reading the tape and I trade using money management principles. The losses in trading can be very real, and depending on the investment vehicle and market, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. I do have 15 years of experience in trading and investing in these markets. Airelon's Challenge Chronicles are demo accounts,with all of the inherent problems therein, which are used within this blog in an attempt to track the results of my own thought processes., and is run as a model. Traders who should make their own decisions based off their own research, due diligence, and tolerance for risk. Any pictures used within this blog are believed to be public domain. Any charts that displayed using the ThinkorSwim platform, or any other charting software are believed to be public domain. Any other pictures were obtained through Wikipedia's public domain policy. As a reminder, any trades discussed for "Airelon's Challenge Chronicles" would only be 'day trades' according to the parameters discussed for Airelon's Challenge Chronicles, at this stage of the game in order to escape the risk of over-leveraged gap opens in the commodity futures markets. As a 'trading sister' would have grown to the $30,000 level, I would have graduated the account into 'swing trading'. In addition, it is understood that readers have read my YouTube methodology series. It is also understood that the writer of this blog has repeatedly warned against the dangers of shadowing any other traders thoughts. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research, and tolerance for risk

Charting 101 (Series): An Introduction (Remake VIDEO)

2011-06-24T11:24:00.008-04:00

"Second, we have to make the most of the strengths we have, the amenities that many of our competitors cannot replicate. But again, those advantages won't mean much if we don't do a great job with the basics of our business." - Gerard Arpey

Most of my entries, videos and podcasts discuss things like "Emotional Discipline" or "Money Management" or "Portfolio Management". But at a certain point? You have to know the nuts and bolts behind a chart.

This video is actually a remake video to a video playlist, or series of videos that I had over 3 years ago on "Charting 101".

(Video Included. If you're seeing this entry elsewhere and cannot see the Video? Click this link to view the entry ...)

Airelons Challenge Chronicles No 23.2 (PODCAST)

2011-06-21T13:58:00.009-04:00

So what is "Airelon's Challenge Chronicles"? You can find a description by clicking here.

In this entry, I update my thoughts on the previous A.C.C. entry by discussing a drawdown kill switch (amazing how many 'professionals' out there refuse to discuss this topic since they are 'always right') as well as how this weeks A.C.C. 23 points to the need to have parameters before entering a market.

(Podcast Included. If you're seeing this entry elsewhere and cannot play the podcast? Click this link to go to the exact podcast entry ...)

Podcast Powered By Podbean

Click here to download this podcast.

As follows is a summary of the "Challenge Chronicle" 'Three Sister' accounts as of this entry ...

Investing "Sister" Account: Will no longer make Rule No. Two Deposits to this Account. Challenge Project Investing Account is Active. I will continue to track this account so as to mark progress of previous decisions.

Investing "Sister" Account: $1,567.45
( YTD the account is +13 % Return on Capital YTD is +4.696 % )

6.3283 shares of KO ( DRIP is on for 4.3283 shares - Yield is +2.8463 % )
5.2422 shares of JNJ ( DRIP is on for 3.2422 shares - Yield is +3.4188 % )
10.15282 shares of GIS ( DRIP on for 10.15282 share - Yield is +2.9144 % )
Cash $389.87 ( 24.87 % )

Additional $243.75 ( 15.7 % ) available from slush fund, up to $1,811.20

Trading "Sister" Account: $3,193.47

( YTD the account is +22.46 % True Return on Capital YTD is +5.645 % )

2% risk tolerance gives us $63.86 'at risk' levels
3% risk tolerance gives us $95.80 'at risk' levels
Additional $243.75 available from draw-down / slush fund, to $3,437.22

(YTD cash equity up about 8.371 % Return on Capital is 0.03487 %)

$243.75 for a Slush fund / Draw-down Kill Switch fund
$487.84 for a Base Savings

-$401.84 of this cash I reserve for savings 'maneuvering' capital ( 82.37 %)
-$ 59.00 of this cash I reserve for CD Ladder creation ( 12.09 % )
-$ 10.00 of this cash I reserve for the first side-pocket purchase ( 2.05 %)
-$ 10.00 of this cash I reserve for the second side-pocket purchase ( 2.05 %)
-$ 7.00 of this cash I reserve for the hedging account ( 1.435 %)

$243.75 for Emergency Savings

-$731.59 of this cash is in an interest bearing account.
-$243.75 remains at the brokerage in an account for draw-down

Total Airelon's Challenge Chronicles Balance: $5,736.26 ( YTD the account is +17.12 % Return on Capital YTD is +4.391 % )

And once again, here are the money management performance metrics as they exist ...

* * *

Note: The above statements should not be construed as an investment or trading recommendation. Airelon's Investing and Trading Journal is a blog that allows subscribers to look 'over my shoulder' as it were, for my own personal specific trading and investing ideas and thoughts for the next week. But they are only thoughts as of the moment of publication, and are subject to change.. Any trades or investments that I discuss within this blog are simply my own thoughts regarding my own investing and trading outlook. Remember that entering any market is an individual decision. There is no guarantee that I will enter, or have entered any of the trading or investing ideas that I discuss in this blog; as larger accounts may require a different strategy as the ones presented here. This blog simply contains my trading and investing thoughts for the next week. I, the author do not grant this work for wide distribution beyond any single individual subscriber as this publication is protected by U.S. And International Copyright laws. All rights reserved. No license is granted to the user except for the user's personal use. No part of this publication or its contents may be copied, downloaded, stored in a retrieval system, further transmitted or otherwise reproduced, stored, disseminated, transferred, or used, in any form or by any means except as permitted under the original subscription agreement or with prior written permission. I personally only enter any market after watching and reading the tape and I trade using money management principles. The losses in trading can be very real, and depending on the investment vehicle and market, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. I do have 15 years of experience in trading and investing in these markets. Airelon's Challenge Chronicles are demo accounts,with all of the inherent problems therein, which are used within this blog in an attempt to track the results of my own thought processes., and is run as a model. Traders who should make their own decisions based off their own research, due diligence, and tolerance for risk. Any pictures used within this blog are believed to be public domain. Any charts that displayed using the ThinkorSwim platform, or any other charting software are believed to be public domain. Any other pictures were obtained through Wikipedia's public domain policy. As a reminder, any trades discussed for "Airelon's Challenge Chronicles" would only be 'day trades' according to the parameters discussed for Airelon's Challenge Chronicles, at this stage of the game in order to escape the risk of over-leveraged gap opens in the commodity futures markets. As a 'trading sister' would have grown to the $30,000 level, I would have graduated the account into 'swing trading'. In addition, it is understood that readers have read my YouTube methodology series. It is also understood that the writer of this blog has repeatedly warned against the dangers of shadowing any other traders thoughts. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research, and tolerance for risk

Monday Challenge Project Summary: June 20, 2011 (VIDEO)

2011-06-20T15:28:00.008-04:00

(Please note there was an A.C.C. entry earlier today)

Previous $500 Challenge Project Balances:

"The Three Sisters":

Investing "Sister" Balance: $1,228.04
Trading "Sister" Balance: $2,394.36
Side-pocket Savings "Sister" Balance: $800.19
Total Challenge Project Funds: $4,422.59

Introduction:
The original video explanation of the Challenge Project that began with $500, is to be found here. If you would like to hear the "why" behind the challenge project, you can find that here as well as here. The Challenge Project is basically a demonstration of a model that anyone could at least follow along with on a weekly basis. It is my attempt without cost, to help out the 'little guy' when it comes to investing and trading by providing an example, a 'model' as it were ... as run by myself as a professional trader with real money, in accounts that I own; following my own three sisters portfolio management system; albeit modified a bit to operate with low funds. From time to time, I provide snapshots of the broker statements.

Rule No. 2 of the Challenge Project states that each month, we can divvy up $100.00 as we wish between the various challenge project accounts. We split up Rule No. 2, into weekly segments; or $25.00 a week. As I mentioned on August 10th I have liquidated all of the other personal accounts that I've discussed on this blog for the last 4 years, and to emphasize the strength of these principles? I will demonstrating my success, again, this time it will be live, with the 'Challenge Project', full time.

For this week, the $25.00 weekly deposit is being transferred to the Challenge Project SAVING SIDE-POCKET Account.

This week, I want to discuss a bit of portfolio management, but after that necessary business? I want to discuss perspective. Why do I keep calling the $4,500 portfolio a "tiny" account?

(Video Included. If you're seeing this entry elsewhere and cannot see the Video? Click this link to view the entry ...)

Here is the blip.tv version of the video.

Here are the new balances for each of the Challenge Project accounts ...

Challenge Project Balances After Rule No. 2 Deposit:

Goals for Each Account

Investing Account: This Entry describes the next goal. Account is 'active'
Trading Account: $2,600.00
Savings Side-Pocket Account: This Entry describes the next goal. Account is 'active'

Investing Account Balance: $1,257.68
(YTD the account is +23.26 % YTD Return is about +3.059 % )

6.3283 shares of KO ( DRIP is on for 4.3283 shares - Yield is +2.8650 % )
5.2422 shares of JNJ ( DRIP is on for 3.2422 shares - Yield is +3.4394 % )

- 0.0275 shares accumulated in DRIP on 6/14/2011 at $66.54
-$1.14 cash in cash dividend from Johnson & Johnson (JNJ) at other account

6 shares of GIS ( DRIP is not on for any shares - Yield is +2.9513 % )
Cash $267.21 ( 21.25 % )

Percentages of that Cash:
-$175.37 of this cash I reserve for 'maneuvering' capital ( 65.63 % )
-$ 17.94 of this cash I reserve to D.C.A. KO ( 6.714 % )
-$ 43.22 of this cash I reserve to D.C.A. JNJ ( 16.17 % )
-$ 20.68 of this cash I reserve to D.C.A. GIS ( 7.739 % )
-This leaves $ 5.00 cash available for a new purchase ( 1.871 % )
-This leaves $ 5.00 cash available for a second new purchase ( 1.871 % )

Additional $206.25 ( 16.4 % ) available from slush fund, up to $1,463.93

Investing Account Balance Year to Date
(Can be Enlarged)

Trading "Sister" Account: $2,394.36
( YTD cash equity up 7.885 % Return on Capital is 0 % )

2% risk tolerance gives us $47.88 'at risk' levels
3% risk tolerance gives us $71.83 'at risk' levels
Additional $206.25 available from draw-down / slush fund, to $2,600.61

Trading Account Balance Year to Date
(Can Be Enlarged)

Savings Side-Pocket Balance: $825.19
(YTD cash equity up about 32.03 % Return on Capital is 0.02303 % )

$206.25 for a Slush fund / Draw-down Kill Switch fund
$412.69 for a Base Savings

-$326.69 of this cash I reserve for 'burn rate / maneuvering' capital ( 80.51 %)
-$ 59.00 of this cash I reserve for CD Ladder creation ( 13.99 % )
-$ 10.00 of this cash I reserve for the first side-pocket purchase ( 2.249 % )
-$ 10.00 of this cash I reserve for the second side-pocket purchase ( 2.249 % )
-$ 7.00 of this cash I reserve for the hedging account ( 0.9995 %)

$206.25 for Emergency Saving

Savings Account Balance Year to Date
(Can Be Enlarged)

- As described in previous entries, all deposits past $675.00 will be towards an interest bearing account, although it separate accounts will still be treated as one 'sister' portion of the book

Total $500 Challenge Project Balance: $4,477.23 ( YTD the account is +15.85 % YTD Return is about +0.8451 % )

* * *

Note: The above statements should not be construed as an investment or trading recommendation. Airelon's Investing and Trading Journal is a blog that allows subscribers to look 'over my shoulder' as it were, for my own personal specific trading and investing ideas and thoughts for the next week. But they are only thoughts as of the moment of publication, and are subject to change.. Any trades or investments that I discuss within this blog are simply my own thoughts regarding my own investing and trading outlook. Remember that entering any market is an individual decision. There is no guarantee that I will enter, or have entered any of the trading or investing ideas that I discuss in this blog; as larger accounts may require a different strategy as the ones presented here. This blog simply contains my trading and investing thoughts for the next week. I, the author do not grant this work for wide distribution beyond any single individual subscriber as this publication is protected by U.S. And International Copyright laws. All rights reserved. No license is granted to the user except for the user's personal use. No part of this publication or its contents may be copied, downloaded, stored in a retrieval system, further transmitted or otherwise reproduced, stored, disseminated, transferred, or used, in any form or by any means except as permitted under the original subscription agreement or with prior written permission. I personally only enter any market after watching and reading the tape and I trade using money management principles. The losses in trading can be very real, and depending on the investment vehicle and market, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. I do have 15 years of experience in trading and investing in these markets. Airelon's Challenge Chronicles are demo accounts,with all of the inherent problems therein, which are used within this blog in an attempt to track the results of my own thought processes., and is run as a model. Traders who should make their own decisions based off their own research, due diligence, and tolerance for risk. Any pictures used within this blog are believed to be public domain. Any charts that displayed using the ThinkorSwim platform, or any other charting software are believed to be public domain. Any other pictures were obtained through Wikipedia's public domain policy. As a reminder, any trades discussed for "Airelon's Challenge Chronicles" would only be 'day trades' according to the parameters discussed for Airelon's Challenge Chronicles, at this stage of the game in order to escape the risk of over-leveraged gap opens in the commodity futures markets. As a 'trading sister' would have grown to the $30,000 level, I would have graduated the account into 'swing trading'. In addition, it is understood that readers have read my YouTube methodology series. It is also understood that the writer of this blog has repeatedly warned against the dangers of shadowing any other traders thoughts. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research, and tolerance for risk

Airelon's Challenge Chronicles No. 23 (PODCAST)

2011-06-20T00:04:00.007-04:00

(Please note there is the Challenge Project entry later today)

So what is "Airelon's Challenge Chronicles"? You can find a description by clicking here.

For the month of June, 2011, all of rule no. two has already been applied TRADING account.

In this entry, I discuss my thoughts on the equities markets and dividend investing, my thoughts on three different possible trades, and then thoughts on how such ideas could be implemented from the standpoint of portfolio management and recent money management performance ...

(Podcast Included. If you're seeing this entry elsewhere and cannot play the podcast? Click this link to go to the exact podcast entry ...)

Podcast Powered By Podbean

Click here to download this podcast.

As follows is a summary of the "Challenge Chronicle" 'Three Sister' accounts as of this entry ...

Investing "Sister" Account: Will no longer make Rule No. Two Deposits to this Account. Challenge Project Investing Account is Active. I will continue to track this account so as to mark progress of previous decisions.

Investing "Sister" Account: $1,552.78
( YTD the account is +11.94 % Return on Capital YTD is +3.716 % )

6.3283 shares of KO ( DRIP is on for 4.3283 shares - Yield is +2.8650 % )
5.2422 shares of JNJ ( DRIP is on for 3.2422 shares - Yield is +3.4394 % )

- 0.0275 shares accumulated in DRIP on 6/14/2011 at $66.54
-$1.14 cash in cash dividend from Johnson & Johnson (JNJ) at other account

10.15282 shares of GIS ( DRIP on for 10.15282 share - Yield is +2.9513 % )
Cash $389.87 ( 25.11 % )

Additional $243.75 ( 15.7 % ) available from slush fund, up to $1,796.53

Trading "Sister" Account: $3,193.47

( YTD the account is +22.46 % True Return on Capital YTD is +5.645 % )

+ $19.07 in Long U.S. Dollar Index Futures from 74280 to 74305 (Including Commissions)
- $87.02 in Long Cocoa Futures from 2900 to 2892 (Including Commissions)

2% risk tolerance gives us $63.86 'at risk' levels
3% risk tolerance gives us $95.80 'at risk' levels
Additional $243.75 available from draw-down / slush fund, to $3,437.22

(YTD cash equity up about 8.371 % Return on Capital is 0.03487 %)

$243.75 for a Slush fund / Draw-down Kill Switch fund
$487.84 for a Base Savings

$243.75 for Emergency Savings

-$731.59 of this cash is in an interest bearing account.
-$243.75 remains at the brokerage in an account for draw-down

Total Airelon's Challenge Chronicles Balance: $5,728.48 ( YTD the account is +17.03 % Return on Capital YTD is +4.25 % )

And once again, here are the money management performance metrics as they exist ...

* * *

Note: The above statements should not be construed as an investment or trading recommendation. Airelon's Investing and Trading Journal is a blog that allows subscribers to look 'over my shoulder' as it were, for my own personal specific trading and investing ideas and thoughts for the next week. But they are only thoughts as of the moment of publication, and are subject to change.. Any trades or investments that I discuss within this blog are simply my own thoughts regarding my own investing and trading outlook. Remember that entering any market is an individual decision. There is no guarantee that I will enter, or have entered any of the trading or investing ideas that I discuss in this blog; as larger accounts may require a different strategy as the ones presented here. This blog simply contains my trading and investing thoughts for the next week. I, the author do not grant this work for wide distribution beyond any single individual subscriber as this publication is protected by U.S. And International Copyright laws. All rights reserved. No license is granted to the user except for the user's personal use. No part of this publication or its contents may be copied, downloaded, stored in a retrieval system, further transmitted or otherwise reproduced, stored, disseminated, transferred, or used, in any form or by any means except as permitted under the original subscription agreement or with prior written permission. I personally only enter any market after watching and reading the tape and I trade using money management principles. The losses in trading can be very real, and depending on the investment vehicle and market, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. I do have 15 years of experience in trading and investing in these markets. Airelon's Challenge Chronicles are demo accounts,with all of the inherent problems therein, which are used within this blog in an attempt to track the results of my own thought processes., and is run as a model. Traders who should make their own decisions based off their own research, due diligence, and tolerance for risk. Any pictures used within this blog are believed to be public domain. Any charts that displayed using the ThinkorSwim platform, or any other charting software are believed to be public domain. Any other pictures were obtained through Wikipedia's public domain policy. As a reminder, any trades discussed for "Airelon's Challenge Chronicles" would only be 'day trades' according to the parameters discussed for Airelon's Challenge Chronicles, at this stage of the game in order to escape the risk of over-leveraged gap opens in the commodity futures markets. As a 'trading sister' would have grown to the $30,000 level, I would have graduated the account into 'swing trading'. In addition, it is understood that readers have read my YouTube methodology series. It is also understood that the writer of this blog has repeatedly warned against the dangers of shadowing any other traders thoughts. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research, and tolerance for risk

Week in Review: Housing, Recoveries and Expectations (PODCAST)

2011-06-18T15:17:00.004-04:00

"Given that the structure of an econometric model consists of optimal decision rules of economic agents, and that optimal decision rules vary systematically with changes in the structure of series relevant to the decision maker, it follows that any change in policy will systematically alter the structure of econometric models." - Robert E Lucas Jr.

Welcome to the Week in Week in Review podcast!

Well, since it's been a few weeks since I have had a "week in review" podcast ... I thought I would discuss benchmarking ones investing returns as it's something that Pulling Myself up Financially mentioned in an entry recently. As well, I though I would discuss my thoughts on the length of the economic recovery, factors that are currently in play, the housing market as well as some comments on oil prices.

(Podcast Included. If you're seeing this entry elsewhere and cannot play the podcast? Click this link to go to the exact podcast entry ...)

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Click here to download this podcast.

The Lucas Critique really goes beyond saying that 'economic policy making' does no good. What it states ... is that for every change in macroeconomic policy, the result must be measured closely, because you've just changed the entire equation based upon unexpected results upon the consumer, and the dymanic means by which the individual citizen can adapt to those changes.

It basically states what I've said for years here on this blog.

All changes within a complex economic model are non-linear, not linear ... in nature.

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Note: The above statements should not be construed as an investment or trading recommendation. Airelon's Investing and Trading Journal is a blog that allows subscribers to look 'over my shoulder' as it were, for my own personal specific trading and investing ideas and thoughts for the next week. But they are only thoughts as of the moment of publication, and are subject to change.. Any trades or investments that I discuss within this blog are simply my own thoughts regarding my own investing and trading outlook. Remember that entering any market is an individual decision. There is no guarantee that I will enter, or have entered any of the trading or investing ideas that I discuss in this blog; as larger accounts may require a different strategy as the ones presented here. This blog simply contains my trading and investing thoughts for the next week. I, the author do not grant this work for wide distribution beyond any single individual subscriber as this publication is protected by U.S. And International Copyright laws. All rights reserved. No license is granted to the user except for the user's personal use. No part of this publication or its contents may be copied, downloaded, stored in a retrieval system, further transmitted or otherwise reproduced, stored, disseminated, transferred, or used, in any form or by any means except as permitted under the original subscription agreement or with prior written permission. I personally only enter any market after watching and reading the tape and I trade using money management principles. The losses in trading can be very real, and depending on the investment vehicle and market, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. But I do have 15 years of experience in trading and investing in these markets. Airelon's Challenge Chronicles are demo accounts,with all of the inherent problems therein, which are used within this blog in an attempt to track the results of my own thought processes., and is run as a model. Traders who should make their own decisions based off their own research, due diligence, and tolerance for risk. Any pictures used within this blog are believed to be public domain. Any charts that displayed using the ThinkorSwim platform, or any other charting software are believed to be public domain. Any other pictures were obtained through Wikipedia's public domain policy. As a reminder, any trades discussed for "Airelon's Challenge Chronicles" would only be 'day trades' according to the parameters discussed for Airelon's Challenge Chronicles, at this stage of the game in order to escape the risk of over-leveraged gap opens in the commodity futures markets. As a 'trading sister' would have grown to the $30,000 level, I would have graduated the account into 'swing trading'. In addition, it is understood that readers have read my YouTube methodology series. It is also understood that the writer of this blog has repeatedly warned against the dangers of shadowing any other traders thoughts. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research, and tolerance for risk.

Next A.C.C. May be Delayed

2011-06-16T05:00:00.001-04:00

I'm not sure how much I'll be around in the next few days. Close "like-Family" friend who married my wife and I suffered life threatening situation ... so ... I'll be back when I'm back ...

Concluding thoughts on Psychology Playlist and Review of A.C.C. No. 22

2011-06-15T08:00:00.002-04:00

"Sell in May and Go Away ..." - Market Mantra

For the introduction of this video, I make some concluding comments for the series of videos on "Investing and Trading Psychology and Emotional Discipline", as well as discuss the focus, as well as 'end goal' of this blog.

After those comments, I review my previous trades and comments from the previous entry of "Airelon's Challenge Chronicles" No. 22.

(Video Included. If you're seeing this entry elsewhere and cannot see the Video? Click this link to view the entry ...)

Here is the blip.tv version of the video.

Oh ... and I mentioned in the above video that I would see which of the companies paid a dividend? It was Johnson & Johnson (JNJ) payout day.

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Note: The above statements should not be construed as an investment or trading recommendation. Airelon's Investing and Trading Journal is a blog that allows subscribers to look 'over my shoulder' as it were, for my own personal specific trading and investing ideas and thoughts for the next week. But they are only thoughts as of the moment of publication, and are subject to change.. Any trades or investments that I discuss within this blog are simply my own thoughts regarding my own investing and trading outlook. Remember that entering any market is an individual decision. There is no guarantee that I will enter, or have entered any of the trading or investing ideas that I discuss in this blog; as larger accounts may require a different strategy as the ones presented here. This blog simply contains my trading and investing thoughts for the next week. I, the author do not grant this work for wide distribution beyond any single individual subscriber as this publication is protected by U.S. And International Copyright laws. All rights reserved. No license is granted to the user except for the user's personal use. No part of this publication or its contents may be copied, downloaded, stored in a retrieval system, further transmitted or otherwise reproduced, stored, disseminated, transferred, or used, in any form or by any means except as permitted under the original subscription agreement or with prior written permission. I personally only enter any market after watching and reading the tape and I trade using money management principles. The losses in trading can be very real, and depending on the investment vehicle and market, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. But I do have 15 years of experience in trading and investing in these markets. Airelon's Challenge Chronicles are demo accounts,with all of the inherent problems therein, which are used within this blog in an attempt to track the results of my own thought processes., and is run as a model. Traders who should make their own decisions based off their own research, due diligence, and tolerance for risk. Any pictures used within this blog are believed to be public domain. Any charts that displayed using the ThinkorSwim platform, or any other charting software are believed to be public domain. Any other pictures were obtained through Wikipedia's public domain policy. As a reminder, any trades discussed for "Airelon's Challenge Chronicles" would only be 'day trades' according to the parameters discussed for Airelon's Challenge Chronicles, at this stage of the game in order to escape the risk of over-leveraged gap opens in the commodity futures markets. As a 'trading sister' would have grown to the $30,000 level, I would have graduated the account into 'swing trading'. In addition, it is understood that readers have read my YouTube methodology series. It is also understood that the writer of this blog has repeatedly warned against the dangers of shadowing any other traders thoughts. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research, and tolerance for risk.