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Tuesday, August 26, 2008

Your First Investment Purchase: Mechanics

Quotations of the Day:

"When J.P. Morgan was asked what the stock market was going to do? He replied: 'It will fluctuate'"

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Challenge Accounts:

Investing Account Balance:
Stock / Futures Trading Balance: $954.13
Online Savings Balance: $47.39

Personal Trading Thoughts: As I said yesterday - chop ... chop ... chop. We're in the channel from Hades. We need a higher or high, or a lower low to confirm direction.

Personal Investing Thoughts: HAVE YA HEARD THE LATEST? Heheh. Yeah, the latest rumor that's put me in a really, really good mood? The cash cow that is Frontline Ltd. is thinking about a 5 for 1 stock split. Which means that the shares will increase by 5, for every share I own.
Now, mind you - they will adjust the price so that I won't instantly increase my asset value. However, that means the next time the dividend is paid? I'll have 5x's the number of shares to DRIP with.

My DRIP remains on for all of my stocks. I got a hold of Covestor to see if they could readjust my one account with them. We'll see how that goes. They have a really great support staff over there. I also have my eye on a few stocks for my long term investment portfolio. But also I have in mind that there are signs of weakness in the midst of this relief rally. In addition, September is a month of extreme seasonal weakness. Therefore, I will wait. Sometimes, the best thing you can do with investing, is know when to just wait.

Some time ago, I had a series on "How to Begin". Well, in that series, I discussed that it may be a good idea to get started with Investing, before you get involved with trading. I discuss the mechanics of the very first investment purchase today ... (video included)

Tomorrow, we discuss discuss - the emotions that come with your very first investment purchase ...

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Challenge Project Account Balances and
Money Management Numbers:

Investing Account Balance:
Stock / Futures Trading Balance: $954.13
Online Savings Balance: $47.39

Total Trades: 6
Largest Inter-trade Drawdown: $86.51
Consecutive Losing Trades (Drawdown): 2
Average Drawdown: $56.63
Average Loss: $74.27
Accuracy Rate: 33%
Average Reward: $175.34
Risk : Reward Ratio: 1 : 2.1
Trading Money Gain / (Loss): Up + $53.84

This is not an investment or trading recommendation. The losses in trading can be very real, and depending on the investment vehicle, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. But I do have 12 years of experience in trading and investing in these markets. 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.

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