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Monday, August 17, 2009

Monday Challenge Project Summary: August 17, 2009

Previous Challenge Project Balances:

Investing Account Balance: $490.58
Stock / Futures Trading Balance: $1,496.21
Online Savings Balance: $125.15

The original video explanation of the Challenge Project is to be found here.

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. Some time ago I stated that I may split up Rule No. 2, into weekly segments; or, $25.00 a week.

As far as the investing account, trust me, I will be adding equity to this account in the future. I would love to have about $700.00 cash in that account come this November 1st. Of course, if we added money every week from now until November, it would not give us $700.00 worth of cash. Possibly, a little over $380.00 worth of capital to work with. $700 is simply the 'preferred goal'. We can work with $360.00.

Then why make a goal of over $700.00? Well, I'm stating right now, that if I have continued successes in the trading account? I will funnel those profits over to the investing account.

For this week, the $25.00 weekly deposit is being transferred to the Trading Account. Yes, I know the time between now and November 1st is just ticking away, and that I said that I wanted to be beefing up the investing accounts cash balance. However, since I know I'm going to be doing that, I have to beef up the trading account while I still can. Because in the near future, the investing account will be receiving my full attention. Call this weeks deposit a "last push for the trading account equity"

So the account balances, after this deposit, read as follows:

Challenge Project Balances After Rule No. 2 Deposit:

Investing Account Balance: $481.73
(YTD equity is - 1%. RoC is about -17.5%)
  • 4.1064 shares of KO
  • 3.0301 shares of JNJ
  • 1 SPY 80 Put - September Hedge
  • Cash: $89.12
  • Additional $31.28 available from slush fund
Stock / Futures Trading Balance: $1,521.21
(YTD Cash equity up about 50%. Return on Capital is about 2%)
  • Additional $31.28 available from slush fund
Online Savings Balance: $125.15
(YTD Cash equity up about 2%. Return on Capital is about 1.49%)
  • $31.28 for a Slush fund / Drawdown Kill Switch fund
  • $62.59 for a base savings
  • $31.28 for Emergency Savings
We'll be back to the Challenge Project, next Monday ...

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Note: 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 13 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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