Thursday, February 28, 2008
- Be patient--wait for the opportunity
- Trade on your own ideas and style
- Never trade impulsively, especially on other people's advice
- Don't risk too much on one event or company
- Stay focused, especially when the markets are moving
- Anticipate, don't react
- Listen to the market, not outside opinions
- Think trades through, including profit/loss exit points, before you put them on
- If you are unsure about a position, just get out
- Force yourself to trade against the consensus
- Trade pattern recognition
- Look past tomorrow; develop a six-month and one-year outlook
- Prices move before fundamentals
- It is a warning flag if the market is not responding to data correctly
- Be totally flexible; be able to admit when you are wrong
- You will be wrong often; recognize winners and losers fast
- Start each day from last night's close, not your original cost
- Adding to losers is easy buy usually wrong
- Force yourself to buy on extreme weakness and sell on extreme strength
- Get rid of all distractions
- Remain confident--the opportunities never stop
"Either go at it full force or don't go at it at all. Don't dabble."
Wednesday, February 27, 2008
EWW... that was a bad hold today. I got short at almost the top at the time, very limited risk but it didn't move in my favor as fast as I wanted it to so I got out w/ small profit. HUM was a good trade today. I feel there was momentum and futures was going up so I longed it and got out right before whole number b/c I didn't think it was going to break. I risked 10 cents to make almost 20 so I'm happy with it.
SKT-C, I got printed down low and since it was a low volume stock I didn't want to risk having it go against me quickly so I took the low, sure profits but I could've gotten what looks like extra 60 cents out of them, or $300... SPN was another decent trade. The low on last Friday was around 42, so I shorted it when it broke while the conference call was going on. I'm happy that I stick to my rules and got out on a 20 cent pull back but I'm not happy that I could've gotten another point out of it (but that's looking at the chart after the fact, so...)
DBA, I didn't trade this today but some people lost big on this. It had to do with prices of wheat I think and it shot up really quickly. I actually tried to get short way above b/c it looked like 43.50's printed twice but I didn't get hit, but that would've been a good short.
I've been trying to find new plays and tickers. I tried to find resistance and support in the S&P futures and trade SPY off of that and it could've work out pretty well. There was a point where I identified a floor that flipped to become resistance and it could've worked on two occasions but the only time I traded I only made 2 cents on it b/c I didn't have the patience to hold it. I should give it another shot in the future. I've been thinking about trading GLD off of SLV but haven't found any good entries. USO and OIL both correlate to the oil price pretty well. Lawrence says OIL correlates better I think.
Oh, and I've got Trade the News program set up now. I didn't trade off of it today but I traded STP off of the options news yesterday. It's better than briefing.com I think in that I don't have to leave it open and take up space on my desktop. If there's news it'll just pop up real quick in the corner. Let's hope this is the beginning of a good winning streak!
Tuesday, February 26, 2008
Monday, February 25, 2008
February sucks, let's face it, so what I need to do for now is adapt to the market more. A lot of the moves don't follow through with much strength so I get stopped out all the time. People are confused and uncertain with which direction the market is suppose to go and you can see this from the chart of the Dow that it's just consolidating. I should be trading with less size (which I've been doing the opposite). My risk reward is not quite there. My down efficiency is higher than my up efficiency. I've been stretching out my winners more over time but I've also let my losers slip a little more. Here I should probably continue to look for better entries and tighten my loss on non-EEM stocks to about 7-10 cents instead of 15 like I've been giving it sometimes. Especially right now, I need to be more selective. Wait for just one more indicator to pull the trigger... look at the bollinger band, moving averages and volume more. My winning percentage is good, almost 60% My consistency is pretty low though, below 50%... meaning that I lose money more than half of my days but my winning days have been so much more than losing days it's actually been working for me.
It's easy to feel frustrated in this environment. Jane suggested just undertrade a little bit right now, get a few winning trades and then stretch that out into winning days to just right my head for now. And when the right opportunity comes, like say the Fed decision day coming up in March, be ready to capitalize.
We actually started talking a little bit about other traders and their charts and somehow we got to talking about Earl Nightingale's "the strangest secret," which is that you become what you think about. Martin Owens has been writing down his goals and just consistently hitting them. It's like a self-fulfilling prophecy. If I'm going to super in April like my original goal, really... I think I'll need back to back $7,000 months... which means about an average of $350 profit each day.
Enough with the big picture stuff... let's look at some of the trades today. I was down about $700 today but made it all back in one trade and then dipped back down in the negatives. Gold and Silver made a big dip in the morning today and I should've traded the bounce but I didn't pull the trigger. I think I feel more comfortable shorting the reversal plays than the bounces for some reason. I don't think I like trading SLV as much... it's feels choppier, maybe b/c not as many people are in it and that actually could be a good thing. Gold feels like it trends much nicer and if the position is against me I have ways to get out.
There was a trade that I got into in UPL, I got in when it broke whole number and scaled out on two minor pull backs. Bad hold... I think I'm going to pay attention more to stocks that have bounced off the previous resistance or support level more and places where floor flipped to become a ceiling and vice versa. There were some good ones in UA, UPL, and SHZ.
Saturday, February 23, 2008
I haven't had this feeling in a long while. The last known occurrences are when Anna and I split up and when Agie and I ended things on a sour note, both happened about an year and a half, almost two years ago. Both times I wanted to slit my wrists wide open and just let the blood gush out and add some color to my life. Thankfully there were some divine intervention and the worst thing I did was shaved my head Britney style and locked myself in my apartment for about 3 weeks. Partially because I couldn't get out of bed and partially because I realized what I have done and was waiting for my hair to grow back out. Sometimes I just have this fear and insecurity that I will end up alone, dying... friendless, loveless. This time around, although not as serious, but I guess my fling with Jaime might have something to do w/ it as well... I don't know what else to call it, involvement? kind of, sort of seeing each other?... Anyway, we decided to go our separate ways about two weeks before Valentine's Day and it was just awkward when the actual dreaded day rolled around. I hung out with her for a bit, but I had already given up our dinner reservation to my parents.
I don't do alone very well. My mind starts making up things: wild stories and puffed up tales that are spun from a seed of reality. It's my character flaw. I'm just psycho or manic depressive like that sometimes. At least now I know how to deal with it. I gave Jack and Margaret a text, see if they're working, perhaps they're free to talk. All I needed was some familiar voice, some confirmation that I still do have a friend somewhere in this world.
Jack suggested that I go read, take a walk, or even rent a porno (LOL), do anything except stay by myself and let my mind go crazy. After some light reading at Starbucks, I decided not to have any time constraints for the rest of the day before my Supershuttle pick up. I'm on vacation for Christ's sake! And I'm feeling more stressed out than I do than at work? Ridiculous. All I wanted to do was walk around, try to catch something beautiful, and squeeze the last drop of juice out of my camera's battery. At first I set course south for Golden Gate Park, but memory of how big the damn place is made me veer off to Lincoln Park instead. 15 years ago on my very first visit, I took a picture with the Golden Gate Bridge as the background. I suppose it's like homecoming in a way. I walked down the trail at Land's End from Eagle Point, quickly realizing not wearing socks was a big mistake for a 1.5 mile hike through the rough trail, not to mention on the way back.
Fortunately, I did find the exact spot where the picture was taken. I almost didn't recognize it because the trees in that area haven grown taller, blocking part of the view of the Bridge. As I sat on the park bench, I had a moment of clarity. It's so rare for me to not have a single thought in my head. Nothing. Nada. Zippo. I felt at peace with the world. Could it be the herb and garlic Dutch cheese that I was enjoying, or the mellow voice of Jack Johnson in my headphones? 15 years has gone by. I was 9-years-old then and in another 15 years I'll be almost 40. 40... that's a scary number. The Golden Gate Bridge with all its beauty and glory will undoubtedly still be there. But what about me? What will I be doing in 15 years? 30? Will I even live that long? How tall will those trees be? Should I maybe move to this lovely city that I seem to have some kind of connection with? I tried to read my own palm.. and I was quite pleased with the increasingly prominent success line splitting my hand in half like the Great Divide... from the base of my Fuck You finger, cutting through my Heart, Head, and Life line, towards my wrist.
Inner Bourdain-esque dialogue aside, everything seems to make sense. What I was fuming about just a few hours ago doesn't seem to even matter in the grand scheme of life, even the $75 parking ticket I received. Life is not all about my current P&L. Although I thoroughly enjoy my current job, I need to have an exit plan if it doesn't work out. I should test out the job market, maybe go work for a fund with one of the market wizards mentioned in the books I've been reading as an analyst. Get an MBA on the way and one day become a fund manager myself. Perhaps I should just let nature take its course, like the water flowing out to sea. If I continue to do the things I do in life with great passion, why shouldn't everything work out? After the Napa trip, I think I would do well w/ a travel agency. Working with my dad in our family business, it's natural for me to think in my head of time lines, what logistically needs to happen before the other. As a compulsive checklist-er, the planning is just not hard... especially when you have the vision of everybody's smiling faces on the return home. I also certainly wouldn't mind just opening up a record store on Haight Street, occasionally spin a few tracks myself.
I haven't been on the green side of the admin yet since we moved. It's just been crummy... I only worked two days this week on account that Monday was President's Day and Tuesday my head just wasn't screwed on right. Friday I had to go to Houston in the afternoon, I was planning on trading just the open but since I went out w/ Priscilla the night before I slept through my alarm completely.
Maybe I've been slacking off a bit. I should start reviewing my trades more and I want to start learning more earning plays. I just been feeling extra stressful lately... hopefully it's just the slow February, but I've actually been thinking about quitting and switch jobs or at least test the job market. I believe I should get a second job. This way I can trade more freely and think clearly when I'm at the desk. Also so I can have a reason to move out, get my own place so I'm closer to the office and if I'm going out it's more convenient.
Thursday, February 21, 2008
And now there’s An Education, the screenplay of which Hornby adapted. Unlike his other filmic experiences, Education is not based on a book by Hornby, but on a memoir by Lynn Barber, originally published in Granta. The film has quite the cast, including Peter Sarsgaard, Alfred Molina and Emma Thompson, and will be directed by Lone Scherfig, the Danish director behind Italian for Beginners.
An Education is set in the swinging '60s and stars the 22-year-old Carey Mulligan, who appeared in 2005’s Pride & Prejudice.
Nick Hornby is by far one of my favorite contemporary writers, along with Chuck Palahniuk!
Wednesday, February 13, 2008
I've been feeling like I'm plateauing lately. Some of it might has to do w/ the fact that February has been kind of slow. The other might have to do with the transition into more share size. It's not rare for me to take a 1,000 shares of EEM at times now. I think I took 1,500 shares once today and I shorted 1,000 shares of UNH today. Thank god I didn't get burned on that UNH. Even though I felt like it was really going to die and shorted strong into it I didn't mean to take that many shares. The thing dropped a point but then bounced hard for two and a half.
I wanted to talk to more HP traders (HP = $150,000+ in the past 12 months) and it was natural to start with David, my coach's coach. I should do this more than I have in the past. Maybe like one HP per month, just take them out to lunch or happy hour. There were quite a few things on my mind, mainly just frustrated with improving and usually Davi'd response was "it takes time." Not exactly what I wanted to hear, but maybe that's really it... there's no magic, no trick. If you put in the time and due diligence you will get what you deserve in return.
David's been trading MOO a lot lately and of course I asked him what's the kind of play he's making on that. I also happen to see someone had a spreadsheet of bunch of ETFs and looks like they're making plays off of their IVs. I think I'm going to try to do something similar.
Some takeaways from our conversation:
Once you have something that you do well, then either do it with more size or more often and you'll do better (for me that would be EEM right now. I'm kind of eager to see what Jane has to say from her analysis tomorrow)
If you put an order out and you're getting hit really quick then you're probably getting out too early
You do want to push yourself a little bit. Just slowly increase your share size to a little bit beyond your comfort zone but not so much where you're scared.
Tuesday, February 12, 2008
Changed my default to 500 shares, Lawrence raised my capital to $500,000 now since a lot of times I'd run out of capital putting orders out at the close.
EEM continues to work well for me... not as well as my initial success, but I'm learning how to trade it better now. For me, when it breaks key support or resistance point I should take more shares, like 800 or 1000, but during the middle of the day where it's harder to read the market and range is tighter I should only take about 200 or 400 at most. I'm not holding my winners very well, especially if my position size is big. I'm also trying to get the closing print on EEM (except today I put it in a whole dollar higher almost by mistake and it filled me so I ended up having to take a loss on it using ECNs to get out).
We're moving our pod tomorrow... I'm sitting on the edge again. I don't know... I don't really like that but I suppose it's nice if I have some extra space to myself. I just feel like as if I'm missing out on the action
Monday, February 11, 2008
You are the adventurous princess. Although set into a life of luxury and wealth, you crave the unknown. Learning new things is an integral part of your nature. You have the extraordinary ability of meeting new people without having any preconceived biases. You know what you want and you are willing to take the risk to get it. You're Ariel!
(This is by far the dumbest facebook app ever... I did this more or less as a dare and out of my personal curiosity)
Saturday, February 9, 2008
I'm particularly excited about: Cary Brothers, DeVotchKa, Digitalism, Diplo, Fastball, guy Forsyth, Freezepop, Tommy Guerrero, Halifax, Hanson (yes, I know... don't judge me), Kate Havnevik, The Heilio Sequence, Holy Fuck, Junkie XL, Let's Go Sailing, Madlib, MGMT, Moby, MSTRKRFT, Nada Surf, Jim Noir, N.E.R.D., Oh No! Oh My!, Okkervil River, Peter and the Wolf, Play-N-Skillz, Joshua Radin, R.E.M., Reykjavik, Shout Out Louds, Sia, Simian Mobile Disco, The Soundtrack of Our Lives, Tech N9ne, Tokyo Polic Club, The Toxic Avenger, The Vines, White Denim, Yo La Tengo,
Thursday, February 7, 2008
The first store that I went to, let's just say that the name starts w/ a Z and rhymes w/ sales. One sales lady was busy w/ customers and the other, obviously bored had walked out to socialize with the one of the carts in the mall walkway. After waiting about a good 10 minutes with a neon flashing sign over my head that says "BUYER! INTERESTED! $$$" and boom box in my hand that's going "Cha-Ching! Cha-Ching!" you know, obvious signals, a girl that looks like just finishing her shift finally decided to "interact" with me and went to get the social butterfly.
How do I put this gently.... hmmm... she was TERRIBLE. She treated me with no respect at all. No hello, how you doing, no pleasantries at all. I don't know if it's because I'm a male in a jewlry store that maybe usually says I have no clue what I'm looking for, but I did tell her that I'm looking for a gold necklace. She said it in almost a snotty way: "This is all we have." She didn't really assist me in making a choice, as if I was interupting whatever juicy gossip she had going on with the Cosmetics Cart Lady about Food Court Boy or Cell Phone Contract Sales Guy, not even when I was struggling to put the necklace on and off and trying to find a mirror.
But I decided to get the necklace. It was 50% off, pretty good deal and I gave her my credit card to ring it up. This is after I told her the half of $380 is $190 and she double checked me on her calculator as if Asians are terrible at math, as if I'm terrible at math and completely not capable of taking the half of a easy even number. She asked me for my phone number for their customer database and when she couldn't understand me she gave me the best impression of a Long Island old hag with big hair of a "WHAT?" Think Joey's agent from Friends mixed with Janice.
I asked her about the store's return policy. Part of me, well actually, pretty much all of me knew that when I get home I'm going to think about this brief 10 minutes of the worst shopping experience in my life and get pissed off and come back and return the necklace. Finally, she handed me back my credit card, not in the traditional "Gentle Slide" or the "Here You Go" with my number facing me. No. She held my card, plam up, with her blood red nails, the opposite direction, half checking if she broke a nail during this laboring work.
"Excuse me, how long have you been doing this?"
"Thirteen years," said Joey's agent, almost as if she's proud
Estelle returns back to the cash register to get the slip for me to sign.
"You know what? Just forget it. I don't want it anymore."
Estelle gave me a confused look, wanting some kind of explanation. I told her what I think about the credit card hand off. She scoffed, as if that's the only reason I just stiffed her out of a 35% commission, so I let her really have it. This is a jewlry store for crying out loud. I expect some kind of service. If I was ordering a bowl of noodle soup from some street vendor in Southeast Asia it's a different story but this is just ridiculous.
I went into Store B, or Store "K"... if you know what I mean. A young sales guy saw me and asked me if I needed any help and proceed to give me just that. While the price he quoted me was higher than Store Z I didn't mind it at all. He even did a little assumptive closing on me by asking if I'd like to join the K-Member Club and save on future purchases. I joked with him that if I knew I was going to propose to some girl soon or if I was a rapper I would, but for now I'll just take the neckalce. I asked the young guy same question I did earlier at the first store when he's ringing me up.
"I'm still fairly new. I've been doing this for about three weeks."
"Well, if you ever make it over there to Store Z on your next break you should thank her for your sale here"
And that's that.
Tuesday, February 5, 2008
One person's bad job might be another person's dream job, but misery is universal. The author in the interview propose three signs of a miserable job.
Anonymity: they are not known by the person they work for and that person isn't interested in them professionally and personally.
Irrelevance: when the employee don't see how their job really makes a difference in someone else's life, in some large or small way.
Immeasurement: All human beings need to, in some way, to assess their own performance that's objective. Then they're not left to depend upon the opinion or the whim of a manager once a year during performance appraisal. People need to be able to go home every night and know where they stand. This is why salespeople are generally very satisfied in their job because they have very clear evidence of their performance.
Sunday, February 3, 2008
There's something to be said between poker and trading. Although I wouldn't say that I'm good enough of a poker player to actually find someone to stake me a seat in the World Series of Poker, I definately have been playing for a while and finished in the money at a few small tournaments while I'm in Tahoe, Lake Charles, or Oklahoma, places like that, so I would say that I know what I'm talking about at the very least. Besides, when I'm bored at work when the market is slow I'll get on some free app on say, facebook and play a few hands. There are a few other traders I know that does that as well, some play for actual money online.
First of all, on the surface... there's a good amount of sitting and doing nothing sometimes in both trades. I would say, really about 50% of my hands I fold pre-flop. If you are playing more than that, you're probably risking too much, but that's just my style... I usually only play premium hands or like, suited connectors pre-flop. I'm not a Gus Hansen type that get involved in a lot of pots to see a lot of flops. Different styles, and likewise in trading, everybody has a different style. No two traders trade alike. What works for one person might not work for you, so you have to develop your own style. A lot of set ups might look interesting, but usually not good enough for me to get into the trade. Even though both jobs are cool and fun (from a male perspective usually), they can both be a grind. When no good set ups are happening in trading you are just pulling up symbols after symbols until you finally find one that you like. Same thing w/ poker... a lot of times you're just sitting there folding, and folding, and folding.
Both are probably looked down by your parents... as they are not really "skills." I'm sure there are people out there that view us traders as nothing more than gamers, or even worse, gamblers. On the flip side, people that understands the game, especially the novices might view the top traders or poker players as "artists," as in that we do inexplicable things. How do we know the other guy was bluffing and call his big raise? Why did we fold the pocket queens? How did we know the stock was going to go up/down? Why didn't we get into a certain trade when it looks so money? I would say poker and trading are more of a "craft" than "art." You become skilled at it and something you hone and get even better. A carpenter or masoner might've build a beautiful chapel, but he wasn't the one, nor was he required to come up w/ the artistic vision for it. And because it is a craft, it is something that can be learned. Albeit, I would have to add that some people just have the extra special god given talent to be great poker players or traders, that something sets them apart from the rest of the echelon.
In order to be good at trading and poker, you need to be able to assess your winning probability and your risk-reward. In trading we like a 3 to 1 risk ratio. In poker if I think it's a little more or less than a coin flip situation for me to win the hand but it's a 3-1 pot odds, yeah, I think I'd call the bet. If I have 7/3 off suite pre-flop... yeah, I'd fold that hand for sure. Same goes w/ trading. Certain trades have a higher winning probability than others.
Position sizing is also key to becoming a good poker player or trader. The idea is that when to get the most of your money in the pot to maximize your winnings. If the market is trading in a tight range, than you should probably reduce your share size. If the stock is going in your favor strongly, it might be time to take even more shares. If you have the nut flush or full house, whatever, you should probably raise as much as you can to deduce a call from other players; if you only have a marginal hand then you should try to conserve your chips. You gotta pick your fights, pick the spots where the odds are in your favor (because they usually aren't).
There's cost associated in playing. In trading we have the commission and we have to pay the spread. In poker there's the antes, blinds, and the rake. In poker, I'd rather take small pots here and there than to risk losing a big pot. Often you don't care about the small losses, because one or two huge pots will make your tournament. It's the same in trading. I'd rather get stopped out for a small loss than to hold on, or even worse, add to my loser to try to average it up and lose even more. And often, it's the two or three big winners that I have that ended up making my day, month, or even year while on bad days I get nickle and dimed w/ a series of small losses.
A friend of mine works as newcaster in Longview... I hope nothing like this ever happens to him. This also reminded me of the time that I parked under a tree at 5th and Trinity and birds totally pearl harbored and dropped bombs all over my car. I had to take it into the dealership to get one of those complimentary car washes for the first time.
Saturday, February 2, 2008
I'm getting off to a decent start in February, although Friday felt extremely slooooowww. I changed some of my order defaults to 1,000 now even though Lawrence didn't officially up my share size yet. I have some voodoo keys set up that would help me put orders out to the specialist, ARCA and INET when I'm scalping, and I've also changed the color preference on my tape so I can tell easier where the print was routed. I should've got long on the ACV imblance at the end when it flipped from sell to buy... I got hit on another trade for 1,000 shares and I was only able to get out of 400 before the close. I'm just going to try to not think about it as much as I can over the weekend.
Let's get even better about my losses this month. I had a few days where I hit my loss limit for the day. Actually, let's make that a goal. I'm not going to hit my loss limit at all for the month of February. I want to trade about 25,000 shares to 30,000 shares a day. This is it, man... learning period is over. It's go time!