Lone Investor

Define yourself

noreply@blogger.com (Admin) — Thu, 20 May 2010 15:48:00 +0000

Are you creating your own wealth? Cutting your own path? Making your own decisions? Or do you still watch the talking heads on CNBC? Those that create doomsday scenarios, from what will be paragraphs in history books. Surely following others is a path to mediocrity at best and foolishness at worst.

Home Runs

noreply@blogger.com (Admin) — Thu, 15 Apr 2010 15:47:00 +0000

Sometimes a single home run can carry your portfolio for months at a time, home runs can be found in any market environment except crashes, then you might have to settle for bearish singles.

When are your quarterly reports?

noreply@blogger.com (Admin) — Fri, 09 Apr 2010 14:39:00 +0000

Alwyas know when profits are reported in your holdings. Especially if you have a profit, it is too easy for the stock to drop like a lead balloon if profit reports are not a home run. Generally take profits before the report ifyou are happy with them, disappointing profits will drop the stock through any stop-loss.

Across the disciplines

noreply@blogger.com (Admin) — Tue, 23 Mar 2010 14:31:00 +0000

Are you a value investor, a growth investor, an agressive investor, a momentum investor? Short term, swing, long term? If the answer to all of the above is not yes, then you are missing out on opportunity. If you limit your scope, your methods, your time frame, you are limiting your resluts. Truth is every market has many trends, many forces, many ranges going on simultaneously. And to not recognize that is to ignore potential for your portfolio, it is all to ignore crosswinds that may affect your portfolio while you are focusing on your myopic outlook.

Things are good

noreply@blogger.com (Admin) — Thu, 11 Mar 2010 04:17:00 +0000

When trading is going well, you do what you do and be done. When trading is not going well you analyze, re-think, do the what if routine.

Trading is going well.

The overall market continues to be at a crossroad, there is easy to spot resistance yet it is not going down. The last few weeks look healthy to me, even if there is a few down days ahead, all is come on the western front. I doubt the Fed meeting will reveal anything worth worrying about, they just got us all calmed down, nothing drastic will occur until the labor market shows REAL improvement.

A crossroads

noreply@blogger.com (Admin) — Thu, 04 Mar 2010 15:47:00 +0000

If one were to take a five year chart of the SPY. And draw a downward trendline strating in 2007, and an upward trendline from March of last year, one would see a crossroads. I think not more has been placed on a meaningless number than tomorrow's job report.

If you look at bearish index bound ETF's you just don't see a reason to buy right now. However a one percent move on heavy volume can stimulate interest in a hurry.

luck helps

noreply@blogger.com (Admin) — Thu, 04 Mar 2010 00:19:00 +0000

Trading is a lot like baseball, you can do everything right and still lose on any given day. The outcome of any given day can be based on bad luck or good luck. However, over the course of time you are rewarded by sticking to fundamentals, being alert and executing in a timely fashin\on. Good players can do everything right, but in the end it is almost a sixth sense they develop, to achieve success. and like with traders that comes and goes, but sticking to your fundamentals always means you have a chance.

Patience

noreply@blogger.com (Admin) — Wed, 24 Feb 2010 21:15:00 +0000

Patience is a virtue. In trading, patience is a necessity. Not stressing over that which you can't control will add years to your life, add joy to your years, and add dollars to your trading account. If at every turn you have a preconception that the market is ignoring you will quickly spin your trading dollard down the drain.

If instead your methods are sound, money management prudent, then having patience will pay exponentially. The market is never in a rush to prove you right, the rush is always in the trader's mind. Choose your time frame that works with your personality and time constraints, and then as the dude does abide.

Are you committed?

noreply@blogger.com (Admin) — Wed, 24 Feb 2010 02:36:00 +0000

Things worth doing take commitment and sacrifice. It is what separates the successful from the masses. Slacking off when the going gets tough is exactly what the majority of humans do. That is why there are so many infomercials, self help books, TV Doctor whoever shows, and aimless unsatsified people with nothing to say, or to show for themselves.

If you have a goal, an ideal, or even an idea, you must apply yourself to it. If you find your mind changes that is fine, you are not cut out to be a trader, or an author, or domesticated, but be honest about it, and then look for the next thing to commit yourself too. The real fit for you will scream at you relentlessly until you apply yourself or you can just be another brick in the wall.

Results vs. Discouragement

noreply@blogger.com (Admin) — Thu, 18 Feb 2010 15:55:00 +0000

The very nature of trading and of life for that matter, is that you prepare a plan, you enact a plan, and then you see the result of that plan. You either have positive results or discouragement, either way it should act as motivation. A reason for honing your plan, you don't necessarily need to re-invent the wheel, but you need to hone, to fine tune, to learn, from your successes and your failures, results are nothing to celebrate, nothing to get discouraged over, they just are, either they are what you intended or are not.

The 1% Rule

noreply@blogger.com (Admin) — Tue, 09 Feb 2010 18:28:00 +0000

In general whenever equity indicies are moving more than 1% in a given day, it is worth your attention. It might be time re-evaluate, particularly if volume is increased. Last Friday's move now looks more like a blow off selling day than before. However much damage was done, and shorting at the top of this rally, particularly if it comes at a clear resistance area still seems prudent. Although markets change daily. 1103 on the SP 500 appears to be a likely resistance if it can get through the current area of 1072. One could see a trading range between 1044-1103.

Is 1040 a new floor?

noreply@blogger.com (Admin) — Mon, 08 Feb 2010 16:56:00 +0000

Although the technicals have not rebounded yet, and like a seashore with a recent shark attack, perhaps it is not safe wading just yet, there are some interesting companies with interesting patterns (healthcare sector), and some soft commodities like sugar that look tantalizing.

We are still keeping most of our powder dry, though. 1040 on the S&P 500 is holding. An appropriate number as we fill out the dreaded form.

Took Cover

noreply@blogger.com (Admin) — Sat, 06 Feb 2010 02:57:00 +0000

The late afternoon rally forced us to take cover in all short positions, with small profits. We are as close to being in the money are we ever get. We are holding DLM and are holding covered calls in the entire position. Not exactly a ringing bullish endorsement.

The rally was close to a typical blow off day. Large volume, large daily range, yet the market is behaving so bearishly we are not jumping in Monday even if it is strong, there needs to be some settling. Without that we will probably short after any rally appeared to be faltering.

Leveraged ETFs

noreply@blogger.com (Admin) — Thu, 04 Feb 2010 21:08:00 +0000

This was a great day to invest in leveraged short ETF's you could pick your product. The problem with these investment vehicles is their primary move for the day is made before they open for trading, so you lose one whole day of profits. And much more if they reverse the next day.

Before investing in them make sure your move looks to have some staying power, so you can profit in the future. They require some sucking it up as they swing wildly with huge percentage moves in a day likely. Always watch the charts of the underlying index or commodity to make sure you still like the chart, and the idea which you are trading is still valid.

We bought puts Tuesday afternoon in the SPY options, when the market refused to go higher than Monday. If they break through today's close on the odwnside there could be more to fall.

Uh oh Feelings

noreply@blogger.com (Admin) — Wed, 03 Feb 2010 18:36:00 +0000

One can't help but feeling that the next leg is down. But we all know feelings are not tradeable. The market still looks like it is going down. The most bullish thing that appears likely to happen is a trading range. Where ever this market turns south, it will be a crucial level, for future events.

Where she ends nobody knows

noreply@blogger.com (Admin) — Tue, 02 Feb 2010 15:36:00 +0000

Where ever this rally ends will be a key indicator to the next few months. Right now I am ready to buy puts and short ETFs when this rally fizzles. But as always I am open to all possibilities.

Hard Work

noreply@blogger.com (Admin) — Thu, 28 Jan 2010 15:57:00 +0000

If you have not read Malcom Gladwell's Outliers, I recommend it highly as well as Blink. Both of these books in different ways show how people have become successful in various fields.

Outliers in particular shows the value of plain old hard work, tedious hard work. In regards to trading if you are not pouring over charts as part of your routine, you are not working hard. Whatever you rely on for your trading signals, you need to repeat the process over and over, even if you are using an automated trading system, unless you know in you gut that trading sytem is something you can rely on, chacnes are you'll sabotage it the first time things get dicey.

Some Days

noreply@blogger.com (Admin) — Thu, 28 Jan 2010 01:09:00 +0000

There are days when the market is not worth trading. It does not present any opportunities for trading, and even gives the vibe of 'stay away, no matter what you do, you will lose.' Today was just such a day. Nothing appeared enticing short or long, equity, commodity, currency, fixed income, nothing.

If you have a bold toe tomorrow you might gander at KRE or your favorite regional bank.

Finding Stocks

noreply@blogger.com (Admin) — Tue, 26 Jan 2010 15:59:00 +0000

Anyone can hunt in a animal park. Now you must go to the deep bush, and work. Perhaps not yet.

China tightens

noreply@blogger.com (Admin) — Thu, 21 Jan 2010 16:23:00 +0000

FXP bearish China etf is breaking out to the upside. A signifcant move. The US market is falling thorugh initial short term support.

1130

noreply@blogger.com (Admin) — Wed, 20 Jan 2010 17:02:00 +0000

1130 is it. Support on the S&P for four times now, if it breaks that it goes further, so far so good.

Out of Sync

noreply@blogger.com (Admin) — Tue, 19 Jan 2010 18:03:00 +0000

When you feel out of sync of your trading and the market, it is very disconcerting to say the least. One impulse is to punish your portfolio by over trading. Another impulse is to do nothing. Another impulse is to think this trading game is an impossible endeavor. There are probably many other impulses as well.

This time I fell out of sync becuase of the lack of clear cut signals, there has been a bunch of nothing in the market for awhile. However the portfoilo has had wide swings to the down side, which is not one's favorite experiences. Marking time is one thing but losing money while marking time, is very dissatisfying. In the end you can sell some covered calls, purchase some puts. But the market lately has rallied from major drops usually in the first hour. Not giving one much ability to get out of your put positions without major drops in the value of your puts.

In the end covered calls are probably the best play, until we have a major down turn in the trend.

However without major signals it might even be better to sell your profits, or protect them with covered calls and not initiating until the market shows it is really ready to move one way or another,

Mistakes hurt

noreply@blogger.com (Admin) — Fri, 15 Jan 2010 17:22:00 +0000

Woke up this morning to have all profits for the month eliminated. Performed a mental scolding for taking all hedges off, with such a minor turnaround in the market. Then examined market and positions in free fall and put on more insurance.

It would have been common earlier in my trading career to turn away and say f it, and do nothing. Then when the pain had subsided would have traded wildly to try to make it back quickly only to exacerbate the situation, and the downward spiral would have begun.

It is of vital importance when bleeding starts to stem it, before true damage has been done to your portfolio. There is no point in punishing your stupid trading by more stupid trading. You don’t learn from your mistakes by making more.

In the End it is all just a game

noreply@blogger.com (Admin) — Thu, 14 Jan 2010 00:04:00 +0000

Trading is the ultimate strategy game, a way capitalists invented to fund their ideas, has become the game to end all games. Never forget that, and never trade with capital you cannot afford to lose. Sometimes the game lulls us to sleep, sometimes the game seems an exercise in tedium. Sometimes the game seems unwinnable, and sometimes we feel nobody has ever played the game better.

Every day the game will present an emotion for us to deal with, a set of circumstances we never saw coming, or ones we saw so clearly we are amazed everyone else didn't see them as well. It is what you do with these emotions and curcumstances that will either allow you to win more than you lose or vice versa.

For the love of money

noreply@blogger.com (Admin) — Sun, 10 Jan 2010 18:04:00 +0000

You must love money to play this game, and I mean unabashedley love it. You don't have throw it around in everyone's face and act superior, but you havde to love it. The numbers of it, the amounts of it, the growth of it. You have to love looking at your success. You can keep it all to yourself, it canbe your own private passion, in fact I have found once I start talking about it, or even bragging about it, my focus and my results go into the tank.

Lots of people will say love of money is greed, but the contrary, greed is unhealthy greed is unlovable. Greed is the desire for the things money brings. If you love adding money to your accounts more than purchasing something with the same amount then you love it. If you love showing off the things you buy then you have greed. They are two separate and distinct things. Greed will ruin you, love of money will be the motivator of your success.