My investment Philosophy</h1> <article> <h1>My investment Philosophy</h1> <p>banker — Mon, 03 Oct 2011 04:41:00 +0000</p> <p><a href="http://financialhaze.com/wp-content/uploads/2011/10/down-arrow.jpg"></a> Negativity is everywhere. For the first time that I can remember there is significant talk of Stocks being abandoned as an investment. To a certain point I think this is correct. People have been burned, not once but (at least) twice. The internet bubble was the first then 10 years later the Housing collapse in 2008.</p> <p> </p> <p>For me, I remember the internet bubble quite well. I received some deferred compensation and piled it all (well almost all) into the NASDAQ. This was March 1999. You do the math, it is to painful for me. But this situation taught me a lesson. A valuable lesson. All good things come to an end.</p> <p>I have written about my trading style before. Definitely not conventional for successful traders. I scale out of positions and rarely add to winning trades. Seldom do I have an objective to a trade. Rather I hold a position until it doesn’t feel good anymore. I have been criticized on this site (via comments) about it, but it is a style that has worked for me. I happen to feel that markets do not normally move one way. Also your luck has to run out eventually. My experience has been that traders who add to winning positions eventually stop out near break even. It seems to me that longer term traders have more success with this strategy especially if the trade has positive carry. But overall I try to stay away from it. That is not to say that I have never done it. Years ago I was long UsdSgd for about 3 years. I was long varying amounts (and sometimes square) but never short during the period. Another time i ran a core short UsdBrl trade for about 2 years (although there were a few days where I was long), but a large part of these strategies were due to the positive carry and a prevailing Dollar sentiment.</p> <p>Now back to Stocks.</p> <p><span id="more-2886"></span></p> <p>When I got burned in the Internet bubble I decided to become slightly more conservative in my investments. I took to a strategy of cashing out at the end of every year that the DJIA closed at a new yearly high. Let’s say I put $10,000 into my 401k in equal amounts spread out over 12 months and the DJIA ended the year up 4%, at the end of the year I would move the 10k from stocks to a cash instrument. In addition I had some core equity holdings, but it was/is a small percentage of my overall portfolio. I used this basic strategy through 2001-2010. During 2008-09 i didn’t cash out as stocks didn’t close higher. in 2011 I decided that we were in a recovery and I moved some cash into stocks. Mostly financial stocks with some value equity funds thrown in. Bad idea! I am not sitting around hoping and praying for things to get better. I think there is a risk that a large segment of the population does stay away from Stocks in the near term. The elderly and people approaching retirement age have seem extremely shy about placing new money into the market and who can blame them. In the past 10 years we have had no appreciation. When market “experts” talk about investing for the long term what does that mean. 10,20,30 years?</p> <p>During the stock meltdown in 2008, I was extremely happy that I was using my scale out approach to investing. Yes I lost money, but it wasn’t such a number that I had trouble sleeping at night. And there in lies my overall philosophy on investing and trading. Live to fight another day. As long as you have chips at the table you are still in the game. I may not be the biggest winner in the markets, but for now I am still in the game.</p> <p> </p> <p> </p> <p> </p> <p> </p> <p> </p> </article> <article> <h1>Job’s, where will they come from?</h1> <p>banker — Sun, 02 Oct 2011 20:55:16 +0000</p> <p><a href="http://financialhaze.com/wp-content/uploads/2011/10/helpwanted.jpg"></a> Job’s, where are they? More and more I am wondering where we are going to get them from. I started this year very positive, but now I am beginning to think I was wrong, totally wrong. I walk the streets and see more and more empty store fronts. I work in an industry (finance) with an increasingly contracting profit potential (if the profit was even there in the first place is another story). Corporations are hiring less and asking more of the people they currently have. The current employees are happy to have a job and keep quite about the increased workload.</p> <p> </p> <p>If my current employer is a microcosm of the entire industry (and i think it is) we are looking at an institution looking to “dumb it down” (for lack of a better term), while hiring less but asking the same amount of production out of its current staff. I have not seen a mass exodus from my job, nor protests occurring on the trading floor. As one co worker put it, we are in an environment where “we re-adjusting our expectations of what is a correct salary and workload.”</p> <p>So I repeat my question “Where are the jobs going to come from?” I wish I knew!</p> <p>I am becoming convinced that all of the different Job creation plans are a bunch of <a href="http://en.wikipedia.org/wiki/Mumbo_jumbo_(phrase) ">Mumbo Jumbo</a>. One plan I read talked about investing in infrastructure. It worked to get us out of the great depression but this time around I think the effect would be much less then before. A great percentage of the current unemployed are middle management and office workers. Forget whether they want to do this work, more importantly are they capable? Yes, workers from the construction industry would be able to slide into such a role but laid off manufacturing workers would need training. Training would require (Federal) funding as would the infrastructure repairs. In the current environment I do not think that Congress would have any appetite to attempt this fight.</p> <p>I do not see large corporations adding significant employees. I see more and more corporations hiring seasonal employees or temporary workers. They are cheaper, easier to fire and require no benefits.</p> <p>I think the one place there is a chance for growth is in the small to mid size companies. According to the SBA, 64% of the net new jobs come from these firms. That is more then half of nonfarm private GDP. It would seem that this avenue should be explored as it seems to me that the last 4-5 years have been a total waste.</p> <p> </p> <p><span id="more-2861"></span></p> <p> </p> <p>Good Luck and Good Forex Trading</p> <p> </p> <p> </p> <p> </p> <p> </p> <p> </p> <p> </p> <p> </p> </article> <article> <h1>Euro takes the lead</h1> <p>banker — Mon, 01 Aug 2011 21:52:05 +0000</p> <p><a href="http://financialhaze.com/wp-content/uploads/2011/08/europe.jpg"></a> After weeks of the U.S. Debt deal taking center stage today the Euro elbowed its way to the front. Poor <a href="http://www.bloomberg.com/news/2011-07-31/worst-europe-earnings-hitting-industrials-as-stoxx-600-falls-9-.html">European Earnings</a> drove stocks lower. Couple this with the U.S. debt deal and it gave the market a reason to take profit. This however I feel is a short term move. Nothing here says “change in direction”, rather it is a bump in the road on our way to a lower Dollar.</p> <p>With Spanish elections on the way, the door is increasingly opening for a more physically responsible government <a href="http://www.bloomberg.com/news/2011-07-31/spain-election-may-mean-more-austerity-if-rajoy-ousts-socialists.html">Click Here</a>.</p> <p>This is a trend that can gain momentum across the region and should add a lot of strength to the Euro. I am playing it from a basket/positive carry perspective.</p> <p><span id="more-2854"></span></p> <p>Short UsdKrw (1 unit)<br /> Short UsdInr (1 unit)<br /> Short UsdIdr (5 units)</p> <p>Long EurUsd (1Unit) Looking to add to this.<br /> Long UsdTwd (5 units)</p> <p>Positive carry and still net short!</p> <p>Good Luck and Good Forex Trading</p> </article> </main></body></html>