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Monday, September 28, 2009

Monday Challenge Project Summary: September 28th, 2009

Previous Challenge Project Balances:

Investing Account Balance: $570.54
Stock / Futures Trading Balance: $1,521.21
Online Savings Balance: $150.30

If you're not sure what the Challenge Project is? The original video explanation 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.

For this week, the $25.00 weekly deposit is being transferred to the Investing Account.

As you will note in the account balances that follow this entry? I am reserving some of the cash that is in the Investing Account in order to Dollar Cost Average positions that I already hold in Coca-Cola (KO) and Johnson and Johnson (JNJ). For example, I'll want at least $60.00 available at any time. If either one of these stocks fall in share price? I will have cash available to purchase more shares, to better average down my cost-basis. Naturally, as time progresses? I will increase the amount of money that I set aside to dollar cost average the positions. If it is $60.00 at the current time? In the future years, this amount may increase to $300.00

As well, in the future, when I make a purchase of a new dividend DRIP stock for the investing account? I will leave some cash in the account past the purchase price, so that if the opportunity arises to dollar cost average the new position, I'll be able to do so.

As I mentioned last week, I have closed the account with ING Savings as I am sick to death of these banks getting themselves in trouble, and then seeking help from debt ridden governments. The money was therefore transferred to the my personal credit union. I now have those funds as straight cash.

Here are the new balances for each of the Challenge Project, after this weeks deposit ...

Challenge Project Balances After Rule No. 2 Deposit:

Investing Account Balance: $591.82
(YTD cash equity up about 22% Return is about -1.5%)
  • 4.1064 shares of KO (DRIP on)
  • 3.0301 shares of JNJ (DRIP on)
  • Cash: $189.12
-$60.00 of this I reserve to D.C.A. KO
-$60.00 of this I reserve to D.C.A. JNJ
-This leaves $69.12 for cash for new purchases
  • Additional $37.53 available from slush fund
Investing Account Balance Since Inception:

Stock / Futures Trading Balance: $1,521.21

(YTD cash equity up about 50%. Return on Capital is about 2%)
  • Additional $37.53 available from slush fund
Trading Account Balance Since Inception:

Savings Balance: $150.30
(YTD cash equity up about 22.3%. Return on Capital is about 1.49%)
  • $37.53 for a Slush fund / Drawdown Kill Switch fund
  • $75.24 for a Base Savings
  • $37.53 for Emergency Savings
Savings Account Balance Since Inception:

We'll be back to the Challenge Project, next Monday.

* * *

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.

Saturday, September 26, 2009

Week in Review: Dan, Where ya Been? (PODCAST)

"'Honor your father and [your] mother'; which is the first command with a promise" - The Bible, Ephesians 6:2

Welcome to the Week in Review!

Well ... I've been a little "missing in action" within the "Market Buzz" Ventrilo Voice Server this week. Usually, a few of us like to hang out in that server throughout the week while we are observing the capital markets, and while we are engaged in trading.

But this week, I've been absent. What's up? Well, after a review of the markets' action, I will talk a bit about the reason ...

(Podcast Included. If you're seeing this entry elsewhere and cannot play the podcast? Click this link to go to the exact podcast entry ...)



Click here to Download this Podcast.

The blog entries will continue. I'll be in Ventrilo when I can, and when I am in the managing a trade. But I can't promise I'll be in Ventrilo for too long a time period.

Monday, we'll be back to the Challenge Project, and I will describe my 'scaling' plans to a greater extent ...

* * *

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.

Wednesday, September 23, 2009

Investment Series: Infer Bias - By Using Seasonal Factors (VIDEO)

"Sell in May and go away ..." - Popular Market addage

This video is part of a series. The introduction to this series, can be found by clicking here.

After that introduction, I discussed the fact that Buy and Hold is not dead.

Within this "Investing Playlist", I then discussed the fact that the kernel, the root of my investing approach, is that of the "Dogs of the DOW" approach. Modified of course. We then discussed what I see as the true difference between investing and trading.

I then discussed the importance of dividends, and after this, we discussed what I look for when it comes to dividends.

We then discussed the power that DRIP (Dividend ReInvestment Plan) has to compound a single purchase.

Now let's talk some about the actual purchase. How you can 'infer bias', or get the best price for your money? We begin to discuss this topic with the following video regarding Seasonal market biases.

(Video Included. If you're seeing this entry elsewhere and cannot see the Video? Click here to view the entry ...)



As I mentioned in the above video, our next entry in this "Investment Series" will talk about "Averaging Down" or "Dollar Cost Averaging"

* * *

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.

Tuesday, September 22, 2009

Investment Series: DRIP (Dividend ReInvestment Plan): A Path to Compounding Returns (VIDEO)

"Compounding ... is the most powerful force in the universe"

This video is part of a series. The introduction to this series, can be found by clicking here.

After that introduction, I discussed the fact that Buy and Hold is not dead.

Within this "Investing Playlist", I then discussed the fact that the kernel, the root of my investing approach, is that of the "Dogs of the DOW" approach. Modified of course. We then discussed what I see as the true difference between investing and trading.

I then discussed the importance of dividends, and then I discussed what I look for when it comes to dividends.

Now, let's talk about one of the tools of dividend stocks. DRIP.

(Video Included. If you're seeing this entry elsewhere and cannot see the Video? Click here to view the entry ...)



Here is the link to the example I mentioned of the $300 investment in GIS.

We'll next talk about different factors to consider when it comes to making your actual purchase, the timing of your purchase, with a discussion regarding seasonality.

* * *

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.

Monday, September 21, 2009

Monday Challenge Project Summary: September 21st, 2009

Previous Challenge Project Balances:

Investing Account Balance: $535.20
Stock / Futures Trading Balance: $1,521.21
Online Savings Balance: $150.30

If you're not sure what the Challenge Project is? The original video explanation 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.

For this week, the $25.00 weekly deposit is being transferred to the Investing Account.

I'm not sure if you guys have been watching JNJ or KO lately, but they've been on a bit of a tear lately. It's about time too. :) They've lagged behind the rest of the market in the last leg of this rally. So the investment account has surged ahead a little. Regardless, we still have much to do for that Investing Account.

I'm looking to greatly increase our cash reserves for that account, so I can begin to look at 'scaling' strategies, as well as to be able to "Dollar Cost Average" any of the existing positions I already have, if the situation arises to do so.

As well, I have closed the account with ING Savings. As I mentioned earlier last week, as well as in the "Week in Review" podcast, I am sick to death of these banks getting themselves in trouble, and then seeking help from debt ridden governments. The money was therefore transferred to the my personal credit union.

Here are the new balances for each of the Challenge Project

Challenge Project Balances After Rule No. 2 Deposit:

Investing Account Balance: $570.54
(YTD cash equity up about 17.5% Return is about -11%)

Investing Account Balance Since Inception:
  • 4.1064 shares of KO (DRIP on)
  • 3.0301 shares of JNJ (DRIP on)
  • Cash: $164.12
  • Additional $37.53 available from slush fund

Stock / Futures Trading Balance: $1,521.21

(YTD cash equity up about 50%. Return on Capital is about 2%)

Trading Account Balance Since Inception:
  • Additional $37.53 available from slush fund

Savings Balance: $150.30
(YTD cash equity up about 22.3%. Return on Capital is about 1.49%)

Savings Account Balance Since Inception:
  • $37.53 for a Slush fund / Drawdown Kill Switch fund
  • $75.24 for a Base Savings
  • $37.53 for Emergency Savings
We'll be back to the Challenge Project, next Monday.

* * *

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.

Saturday, September 19, 2009

Week in Review: Migration to other Markets for the Right Reasons (PODCAST)

"What, then, is the true Gospel of consistency? Change. Who is the really consistent man? The man who changes. Since change is the law of his being, he cannot be consistent if he stick in a rut." - Mark Twain

Welcome to the Week in Review!

At times? Traders will want to switch. Switch from trading the venue of the capital markets they have been trading, like ... say ... common stock? To Forex. Or he or she is a Forex trader, and they want to switch to trading futures?

Is this a good idea? Does this offer benefits? When should you do this, and when is a 'bad' idea?

After a review of the markets? I discuss the concept a trader switching to another 'market venue' the following podcast ...

(Podcast Included. If you're seeing this entry elsewhere and cannot play the podcast? Click this link to go to the exact podcast entry ...)



Click here to Download this Podcast.

You should never switch from, say ... trading commodities to common stock? Simply because you are bored, or because you are beginning to experience drawdown. It is not "wrong" to trade other markets. It offers a trader a wonderful 'overall' view of the capital markets. I 'switch' or 'migrate' to other markets as it were.

Just make sure you migrate for the right reasons, and you have a definite strategy.

* * *

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.

Wednesday, September 16, 2009

Investment Series: What Sort of Dividends? (VIDEO)

"I rarely think the market is right. I believe non dividend stocks aren’t much more than baseball cards. They are worth what you can convince someone to pay for it." - Mark Cuban

This video is part of a series. The introduction to this series, can be found by clicking here.

After that introduction, I discussed the fact that Buy and Hold is not dead.

Within this "Investing Playlist", I then discussed the fact that the kernel, the root of my investing approach, is that of the "Dogs of the DOW" approach. Modified of course. We then discussed what I see as the true difference between investing and trading.

I then discussed the importance of dividends.

So let's continue that discussion on dividends, and discuss what I look for, when it comes to dividend stocks ...

(Video Included. If you're seeing this entry elsewhere and cannot see the Video? Click here to view the entry ...)



Here is the link to the introductory video with the Khan Academy on reading balance sheets.

The next entry within this series, will discuss one of the most important facets and tools of some stocks that pay dividends, that allow you to compound your returns with a single purchase.

* * *

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.

Tuesday, September 15, 2009

It's Always Something With this Garbage ... (ING Group)

You know, it's always something. And quite frankly? I'm getting sick of the "We'll be fine", "We'll be fine" song when it comes to toxic assets, while the firm simultaneously seeks a handout from the closest debt ridden government.

So at this point, I'm busy this morning trying to decide how much of my money I want to transfer out of ING accounts, and how much it would cost me. Not because I am really anxious for ING's future?

But quite frankly I'm just getting sick of this nonsense.

What does this mean for the Challenge Account, since both the dividend account and the savings accounts are with the ING group?

I'm not sure at this point. I'm still doing some digging. Heck, at this point I'm almost to the point of feeling better about just wrapping my bills in stacks, and storing them in a secure off-site dual safe.

When it comes to my DRIP portfolio? Well, I could always transfer that account into a secondary Think or Swim account, as Sharebuilder is owned by the ING Group. We'll see, and I'll let everyone know what I end up deciding ...

* * *

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.

Monday, September 14, 2009

Monday Challenge Project Summary: September 14th, 2009

Previous Challenge Project Balances:

Investing Account Balance: $505.99
Stock / Futures Trading Balance: $1,521.21
Online Savings Balance: $150.30

Ok, first of all, I do have to apologize that there was no week in review podcast. But I was honestly that busy this weekend. Literally, from Friday afternoon, right up until about 2 hours ago.

Moving on the the title of this entry? The Challenge Project ... If you're not sure what the Challenge Project is? The original video explanation 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.

For this week, the $25.00 weekly deposit is being transferred to the Investing Account.

For the next few months, I will be concentrating on the Investing Account of the Challenge Project. Decisions made during the next few months will focus on this account which has in a sense, become the "forgotten child" of the Challenge Project.

Therefore, here are the new numbers

Challenge Project Balances After Rule No. 2 Deposit:

Investing Account Balance: $535.20
(YTD cash equity up about 10.3% Return is about -15.1%)

Investing Account Balance Since Inception:
  • 4.1064 shares of KO (DRIP on)
  • 3.0301 shares of JNJ (DRIP on)
  • Cash: $139.12
  • Additional $37.53 available from slush fund

Stock / Futures Trading Balance: $1,521.21

(YTD cash equity up about 50%. Return on Capital is about 2%)

Trading Account Balance Since Inception:
  • Additional $37.53 available from slush fund

Online Savings Balance: $150.30
(YTD cash equity up about 22.3%. Return on Capital is about 1.49%)

Savings Account Balance Since Inception:
  • $37.53 for a Slush fund / Drawdown Kill Switch fund
  • $75.24 for a Base Savings
  • $37.53 for Emergency Savings
We'll be back to the Challenge Project, next Monday.

* * *

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.

Friday, September 11, 2009

Investment Series: The Importance of Dividends (Remake VIDEO)

"I rarely think the market is right. I believe non dividend stocks aren’t much more than baseball cards. They are worth what you can convince someone to pay for it." - Mark Cuban

This video is part of a series. The introduction to this series, can be found by clicking here.

After that introduction, I discussed the fact that Buy and Hold is not dead.

Within this "Investing Playlist", I then discussed the fact that the kernel, the root of my investing approach, is that of the "Dogs of the DOW" approach. Modified of course.

Continuing that discussion, I will now discuss the importance of dividends, when it comes to my approach ...

(Video Included. If you're seeing this entry elsewhere and cannot see the Video? Click here to view the entry ...)



The next entry within the 'investment series' will discuss the sort of dividends that I look for ...

* * *

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.

Monday, September 7, 2009

Monday Challenge Project Summary: September 7th, 2009

Previous Challenge Project Balances:

Investing Account Balance: $490.53
Stock / Futures Trading Balance: $1,521.21
Online Savings Balance: $150.15

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.

For this week, the $25.00 weekly deposit is being transferred to the Investing Account. We spent some time bumping up both our trading account, and the savings account. Now? Now it's time to pour on the fuel, for bumping up the cash in the investing dividend account.

And I'm going to be quite honest. That account? Well, it's sort of been the 'forgotten child' of the Challenge Project. Well, it's going to get some love now. I went ahead and sent off the money so it's already posted into that account. Therefore, here are the new numbers

Challenge Project Balances After Rule No. 2 Deposit:

Investing Account Balance: $505.99
(YTD cash equity up about 4.25% Return is about -17.5%)

Investing Account Balance Since Inception:
  • 4.1064 shares of KO (DRIP on)
  • 3.0301 shares of JNJ (DRIP on)
  • 1 SPY 80 Put - September Hedge - soon to expire
  • Cash: $114.12
  • Additional $37.53 available from slush fund

Stock / Futures Trading Balance: $1,521.21

(YTD cash equity up about 50%. Return on Capital is about 2%)

Trading Account Balance Since Inception:
  • Additional $37.53 available from slush fund

Online Savings Balance: $150.30 (Interest Payment from Aug)
(YTD cash equity up about 22.3%. Return on Capital is about 1.49%)

Savings Account Balance Since Inception:
  • $37.53 for a Slush fund / Drawdown Kill Switch fund
  • $75.24 for a Base Savings
  • $37.53 for Emergency Savings
We'll be back to the Challenge Project, next Monday.

* * *

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.

Saturday, September 5, 2009

Week in Review: The Markets, and Unemployment inside of a Credit Recession (PODCAST)

"... I've broken it down into kind of an overall view. Because I don't think it's just enough to give people a bunch of numbers, and things, and here's a system. Because my sense is you get a system, or some parameters to trade with ... and you think you're a great trader. And you're not. And I'm not. Because really being a great trader takes more than just having something mechanical to follow. Being a great trader, means that you have to understand what's going on. Because whatever is going on now, will be different than anything the past. And anything in the future, will not be exactly like now." - Larry Williams

Welcome to the Week in Review!

Yes, I have used the above quotation before in a blog entry. But quite frankly? It's that good of a quotation.

It's so applicable, to the environment that we find ourselves in. Because it is important to understand why data may be valuable, and why data may not be valuable.

For example, lately I've been hearing from numerous sources, that you cannot use unemployment as a guage to economic recovery. Why? Well, such recovery proponents claim that in previous recessions, the actual economic recovery started first, and then employment lagged behind that recovery. And that's true. It did.

But is that relevant to what's going on today? Why did that happen in previous recessions?

After a review of the markets? I discuss the importance of understanding 'why' in reference to the unemployment situation, within the following podcast ...

(Podcast Included. If you're seeing this entry elsewhere and cannot play the podcast? Click this link to go to the exact podcast entry ...)



Click here to Download this Podcast

Here is the link to video, in which Mark Douglas discusses the psychology of trading.

* * *

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.

Thursday, September 3, 2009

Workstations: Simple and Peaceful (VIDEO)

"Simplicity is the ultimate sophistication." - Leonardo da Vinci

For some time, I've received questions regarding my workstation, and trading workstations in general.

"What sort of computer does a trader need?"

"What sort of monitors does a trader need?"


In the following video; I'll show you the work area in my home, and attempt to highlight simplicity ...

(Video Included. If you're seeing this entry elsewhere and cannot see the Video? Click here to view the entry ...)



Here is the blip.tv version of the video.

Having 10 monitors will not make you a better trader.

Having a more powerful processor will not make you a better trader.

I'd say the most important aspect of any workstation? More important than the type of processor you use, or the number of monitors you have hooked up to it? Is that it's location is within a peaceful working environment.

* * *

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.

Wednesday, September 2, 2009

Airelon's Investing and Trading Thoughts: September 2009 (VIDEO)

Challenge Project Accounts:

Investing Account Balance: $506.20
Stock / Futures Trading Balance: $1,521.21
Online Savings Balance: $150.30

Near the beginning of every month, I have an "outlook" entry in which I discuss what I have my eye on for the upcoming month.

Here it is. My "outlook" vlog entry for the month of September of 2009

(Video Included. If you're seeing this entry elsewhere and cannot see the Video? Click this link to view the entry ...)




* * *

Challenge Project Accounts:

Investing Account Balance: $506.20
Stock / Futures Trading Balance: $1,521.21
Online Savings Balance: $150.30

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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