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Saturday, January 30, 2010

Week in Review: Be Skeptical (PODCAST)

"The skeptic does not mean him who doubts, but him who investigates or researches, as opposed to him who asserts and thinks that he has found" - Miguel de Unamuno

Welcome to the Week in Review!

What a week! Commodities are plummeting, the stock market sunk further. Apple releases earning, and releases the iPad to the public. After that, allegations are flying around the financial blogosphere.

Well, after reviewing the other capital markets, we'll talk about all of that in this "Week in Review" 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.

* * *

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 over 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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Friday, January 29, 2010

Friday Investing and Trading Review for January 29th, 2010 (VIDEO)

"Decide what you want, decide what you are willing to exchange for it. Establish your priorities and go to work." - H.L. Hunt

Here is ... the "Friday Review" video, that will review my investing and trading efforts for the last week, based off of comments in last weeks "Airelon's Market Tactics".

This video was recorded at about 11:00 am this Friday morning ...

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



* * *

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 over 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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Thursday, January 28, 2010

Commodities Trading and Futures Speculation: The Reason for the Markets Existence (Series) (VIDEO)

"Any fool can make things bigger, more complex, and more violent. It takes a touch of genius-and a lot of courage-to move in the opposite direction." - Albert Einstein

This vlog entry is a continuation in a series of videos, the "Commodities Trading and Futures Speculation", and is continued from yesterday's entry.

Ok ... probably the first question to look at, is ... why do the Commodity and Commodities Futures markets even exist in the first place? What is the reason for their existence? The answer, may surprise you.

We discuss this topic in the following vlog entry ...

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



We will continue this series with a discussion regarding the need for traders in future contract months ...

* * *

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 over 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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Wednesday, January 27, 2010

Commodities Trading and Futures Speculation: An Introduction (Series) (VIDEO)

"Through clever and constant application of propaganda, people can be made to see paradise as hell, and also the other way round, to consider the most wretched sort of life as paradise." - Adolf Hitler

I use the above quote, not to demonstrate nobility. But to demonstrate the evil, that is propaganda. This video is the introduction to a series of videos, regarding ... well ... my job.

Commodities futures, and futures speculation.

You may have been told "all about" (notice the quotes) commodities speculation in the mainstream news media. As Paul Harvey would say, I'm here to tell you "the rest, of the story ..."

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



Tomorrow, we will continue this series by discussing the reason for the markets existence ...

* * *

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 over 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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Tuesday, January 26, 2010

I Just Have to Pass this Along ...

This is just too good to pass up, and I have to share with you folks, if you haven't seen it already.

I'm not sure if you guys caught the "buzz" lately, but it appears that it's possible that "Zerohedge" has been busted for plagiarism. There are actually two blog articles that discuss both the "Zerohedge" posts, and compares them side by side to a couple of Morgan Stanley (MS) reports. The first entry is here, and the second is here.

So a blogger, who has become somewhat "famous" in the financial world for his rants and raves about Wall Street and it's many injustices (and to be sure, there are many) ... is plagiarizing analyst reports out of Morgan Stanley (MS)? Is this right? Then you have other bloggers quoting Zerohedge?

I swear, I saw one of them saying "... this just in this morning, from the wire", and "wire" was linked to a Zerohedge article. Are you kidding me?

So let me get this straight. You have a blogger, plagiarizing Wall Street analyst reports, to rant against wall street, and then other bloggers quoting him as a "source"?

Only in this business. Only in this industry.

Heck, you can't make this stuff up.


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Monday, January 25, 2010

Monday Challenge Project Summary: January 25, 2010

Previous $500 Challenge Project Balances:

"The Three Sisters":

Investing "Sister" Balance: $796.31
Trading "Sister" Balance: $1,654.23
Interest Bearing "Sister" Balance: $225.30
Total Challenge Project Funds: $2,675.84

Introduction:
The original video explanation of the Challenge Project that began with $500, is to be found here. The Challenge Project is basically a demonstration of a model that anyone could at least follow along with on a weekly basis. It is my attempt without cost, to help out the 'little guy' when it comes to investing and trading by providing an example, a 'model' as it were ... as run by myself as a professional trader with real money, in sub-accounts that I own; following my own three sisters portfolio management system; albeit modified a bit to operate with low funds. From time to time, I provide snapshots of the broker statements.

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 Challenge Project SAVINGS Account.

With this addition to the savings account, simultaneously add small fortifications to buttress to every account within the "three sisters". It obviously increases the balance to the Base Savings, as well as the Emergency Savings. It strengthens the Slush fund, which is available to the Investing Account as well as the Trading Account.

One deposit, five positives.

Here are the new balances for each of the Challenge Project ...

Challenge Project Balances After Rule No. 2 Deposit:

Investing Account Balance: $785.80
(YTD cash and equity is down -1.68 % Return is +0.59 %)
  • 4.1665 shares of KO (DRIP on)
  • 3.0779 shares of JNJ (DRIP on)
  • 2 shares of MCD (DRIP is now OFF)
  • Cash: $238.51
-$62.00 of this cash I reserve to D.C.A. KO
-$62.00 of this cash I reserve to D.C.A. JNJ
-$82.00 of this cash I reserve to D.C.A. MCD
-This leaves $32.51 cash available
  • Additional $62.00 available from slush fund
Investing Account Balance Since Inception
(Can be Enlarged):



Stock / Futures Trading Balance: $1,654.23
(YTD cash and equity up about 3.64 % Return on Capital is 0.5 %)
  • 3% risk tolerance gives us $49.62 to risk per trade
  • Additional $62.00 available from drawdown / slush fund
Trading Account Balance Since Inception:
(Can Be Enlarged)


Savings Balance: $250.30
(YTD cash equity up about 25 % Return on Capital is 0 %)
  • $62.00 for a Slush fund / Drawdown Kill Switch fund
  • $126.30 for a Base Savings
  • $62.00 for Emergency Savings
Savings Account Balance Since Inception:
(Can Be Enlarged)



Total $500 Challenge Project Balance: $2,690.33

Total Challenge Account Growth Since Inception:
(Can Be Enlarged)



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 over 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, January 23, 2010

Week in Review: The Pullback is Here !! ... Isn't It? ... Well ... I dunno ... What do you think? It's Here? Maybe? (PODCAST)

"Amid the turmoil and tumult of battle, there may be seeming disorder and yet no real disorder at all; amid confusion and chaos, your array may be without head or tail, yet it will be proof against defeat" - Sun Tzu, The Art of War

Welcome to the Week in Review!

Well, well, well. Since I recorded the "Friday Investing and Trading Review" video, the DOW Jones sunk another 216.90 points.

What I find most curious about Friday's action in the equities markets? Is the amount of indecision that I see. It really shouldn't surprise me, when I heard so many who were becoming involved in the market saying: "No matter what, this is what you need to do, the market is going to ..."

Really? Seriously?

What is my response to the drop in equities that was experienced on Friday? Well, after reviewing the other capital markets, we'll talk about that in this "Week in Review" 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.

I said I was going to include a chart of the Dow Jones, or the S&P 500, but better yet, here is a chart of a company like Coca-Cola (KO). Should you buy more, if you liked Coca-Cola as a dividend investing hold?

Coca-Cola (KO) since March
(Can be Enlarged):



It depends, not on what will happen in the future, but your own individual portfolio's "capital capabilities"!!!

* * *

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 over 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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Friday, January 22, 2010

Friday Investing and Trading Review for January 22nd, 2010 (VIDEO)

"Players don't need rest. If someone is injured and needs time to recuperate, that's one thing. But players need to go out and play. One of the things that can happen if you take a player off the field is that he loses his edge by standing on the sidelines." - Harry Carson

Here is ... the "Friday Review" video, that will review my investing and trading efforts for the last week, based off of comments in last weeks "Airelon's Market Tactics".

Now mind you, this was recorded before today's action in the markets ...

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



If anything? I'm more ecstatic with the pullback in equities that occurred after I recorded this video.

* * *

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 over 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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Thursday, January 21, 2010

Scalping and Interest Rates (PODCAST and VIDEO)

"It's not about the one trade, it's about the many trades" - Personal Axiom

"Cheap Interest Rates will not fix the current economic problem. It simply staves off complete disaster." - Personal Axiom


Last week, I had answered a few questions I received in the form of a podcast entitled "The Cusp of Profitability". I received a lot of positive feedback, so upon receiving a few other questions, I decided to do another one this week.

One question revolves around the recent trade in the Challenge Project, and the other has to do how to with interest rates, the U.S. Dollar, and inter-market relationships ...

(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.

I just keep a simple spreadsheet that keeps track of money management numbers. Here's a snapshot of the spreadsheet for the "Challenge Project Trading Accounts"



After listing in columns various trades, I have cells that automatically keep track of the averages with statements such as ... =AVERAGE(J22;J26;J32;J34) to average certain cells...

To help understand why it is difficult for banks to 'lend again' although given tax money by the government, here is a re-post of the video once again of "De-leverging is Asset Control, Not Money Supply Increases"




* * *

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 over 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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Tuesday, January 19, 2010

Challenge Project Trade: PCBC (VIDEO)

"Opportunities multiply as they are seized." - Sun Tzu, The Art of War

On Monday I said ... "We're about to a point where I think the Challenge Project account could stand another trade" ...

Well ... that didn't take too long did it? I had another trade, and added a few dollars into the Trading account, via a small scalp I just took. I discuss that trade and some thoughts behind it, in the following video ...

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



As follows is a snapshot of the trade confirmation ...


Monday's deposit is still processing ...

Once again, for emphasis, the main thrust at this stage of the game is not to actively trade this account but rather to use rule no. 2; and to look for the majority of the gain from rule no. 2

* * *

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 over 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.

Share

Monday, January 18, 2010

Monday Challenge Project Summary: January 18, 2010

Previous $500 Challenge Project Balances:

"The Three Sisters":

Investing "Sister" Balance: $789.60
Trading "Sister" Balance: $1,621.21
Interest Bearing "Sister" Balance: $225.30
Total Challenge Project Funds: $2,636.11

Introduction:
The original video explanation of the Challenge Project that began with $500, is to be found here. The Challenge Project is basically a demonstration of a model that anyone could at least follow along with on a weekly basis. It is my attempt without cost, to help out the 'little guy' when it comes to investing and trading by providing an example, a 'model' as it were ... as run by myself as a professional trader with real money, in sub-accounts that I own; following my own three sisters portfolio management system; albeit modified a bit to operate with low funds. From time to time, I provide snapshots of the broker statements.

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 Challenge Project TRADING Account.

This will be the main thrust of this quarter. Adding capital to the trading account, and strengthening the trading account through firming up the capital in the savings account. We're about to a point where I think the account could stand another trade.

Here are the new balances for each of the Challenge Project ...

Challenge Project Balances After Rule No. 2 Deposit:

Investing Account Balance: $796.31
(YTD cash and equity is down -1.23% Return is +2.53%)
  • 4.1665 shares of KO (DRIP on)
  • 3.0779 shares of JNJ (DRIP on)
  • 2 shares of MCD (DRIP is now OFF)
  • Cash: $238.51
-$62.00 of this cash I reserve to D.C.A. KO
-$62.00 of this cash I reserve to D.C.A. JNJ
-$82.00 of this cash I reserve to D.C.A. MCD
-This leaves $32.51 cash available
  • Additional $56.00 available from slush fund
Investing Account Balance Since Inception
(Can be Enlarged):



Stock / Futures Trading Balance: $1,646.21
(YTD cash equity up about 3.13%. Return on Capital is 0%)
  • 3% risk tolerance gives us $48.63 to risk per trade
  • Additional $56.00 available from drawdown / slush fund
Trading Account Balance Since Inception:
(Can Be Enlarged)


Savings Balance: $225.30
(YTD cash equity up about 12.5%. Return on Capital is 0%)
  • $56.00 for a Slush fund / Drawdown Kill Switch fund
  • $113.30 for a Base Savings
  • $56.00 for Emergency Savings
Savings Account Balance Since Inception:
(Can Be Enlarged)



Total $500 Challenge Project Balance: $2,667.82

Total Challenge Account Growth Since Inception:
(Can Be Enlarged)


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 over 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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Saturday, January 16, 2010

Week in Review: All Quiet on the Front (PODCAST)

"Gillom Rogers: Yeah, he said that a man has to have guts, and be good with guns.

John Bernard Books: Did he mention that third eye you better have?

Gillom Rogers: Third eye?

John Bernard Books: For that dumbass amateur. There's always some six-fingered bustard that couldn't hit a cow in the tit with a tin cup. " - The Shootist, 1976, John Wayne


Welcome to the Week in Review!

Truth be told, it has been a pretty quiet week. The VIX is measurement of volatility within the market. It's been called by some 'the fear' index, as it rises during times of market uncertainty and crisis. And the VIX? The VIX is down ...



Which means volatility is down, which means fear is down. This is usual after periods of extreme economic distress. Volatility decreases to a more usual range. So I guess what I'm saying here, more than anything else? Is that I'm not someone who will try to whip up some 'avenue of fear and righteous anger' if there is really no problems to talk about. The capital markets always have some problem somewhere. The VIX is saying that the market overall, believes that we're reverting to a more usual 'problem' level. And I don't believe in 'whipping up populist anger' to somehow make myself a more popular blogger to follow. I have no problem saying ... 'yeah, it's been a pretty quiet week'. I like quiet weeks myself. For my own methodology, it's much easier to make money when the markets are 'quiet'.

While I will never say the market is "wrong" about a particular movement (the market isn't wrong, ever), it's focus can remain blind at brewing problems and situations. Thus, while the VIX can remain low, it's not to say there aren't problems. It's just the "market's collective focus", is not towards such problems.

And there are situations to be aware of. We've already talked in past podcasts about volatile carry trade unwinds. Some are discussing China's "hidden" debt situation (Notice I did not call it a problem). It's "a data point" to be aware of. When you are aware of the situation, then it's much harder to be "shot in the back by an amateur", to quote John Wayne.

So let's dive into a recap of the markets overall, as well as my brief comments regarding China and it's debt in the following week in review 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 a link to a podcast where I specifically talk about, and explain the credit markets.

Here is a shot of the recent bond curve ...



* * *

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 over 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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Friday, January 15, 2010

Friday Review for January 15th, 2010 (VIDEO)

"It is only one who is thoroughly acquainted with the evils of war that can thoroughly understand the profitable way of carrying it on." - Sun Tzu, The Art of War

Here it is ... the third "Friday Review" video, that will review my investing and trading efforts for the last week, based off of comments in last weeks "Airelon's Market Tactics" ...

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



Who was it that said that 'in this business you can be wrong, as long as you're wrong small' ?

Regardless, here's the link to the Davian Letter, and their widget is updated for this Friday's Happy Hour show; in which I'll be appearing. It's on the right hand side, the blue dimdim widget. Sign up for the Happy Hour Show now to reserve your spot!

I'll probably also tweet the link, once we're setup and ready to roll ...

* * *

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 over 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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Wednesday, January 13, 2010

The Cusp of Profitability (PODCAST)

"The key to success is having some discipline, .. You don't have to be rocket scientist." - David Caruso

I've received a number of good questions in the form of a few emails of the last few days that were so good, that I wanted to share them in the form of a podcast.

One has to do with the Challenge Project, and the other has to do how to 'turn the corner' as it were, and finally enter the realm of profitable trading ...

(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's the link to vlog entry that I talked about trading for income.

* * *

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 over 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.

Share

Monday, January 11, 2010

Monday Challenge Project Summary: January 11, 2010

Previous $500 Challenge Project Balances:

"The Three Sisters":

Investing "Sister" Balance: $789.60
Trading "Sister" Balance: $1,621.21
Interest Bearing "Sister" Balance: $200.30
Total Challenge Project Funds: $2,611.11

Introduction:
The original video explanation of the Challenge Project that began with $500, is to be found here. The Challenge Project is basically a demonstration of a model that anyone could at least follow along with on a weekly basis. It is my attempt without cost, to help out the 'little guy' when it comes to investing and trading by providing an example, a 'model' as it were ... as run by myself as a professional trader with real money, in sub-accounts that I own; following my own three sisters portfolio management system; albeit modified a bit to operate with low funds. From time to time, I provide snapshots of the broker statements.

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 Challenge Project SAVING Account.

Any contribution to the "savings sister" is sort of like firming up the foundation of both the Investing and the Trading "sisters"; as part of the function of the "savings sister" is to provide a fall-back, drawdown 'cushion' for both the investing and the trading account.

So as I stated I would like to focus on firming up the Trading Account this quarter, such contributions to the savings account are pursuing that goal.

Here are the new balances for each of the Challenge Project ...

Challenge Project Balances After Rule No. 2 Deposit:

Investing Account Balance: $789.60
(YTD cash and equity is down -1.2% Return is -1.2%)
  • 4.1665 shares of KO (DRIP on)
  • 3.0779 shares of JNJ (DRIP on)
  • 2 shares of MCD (DRIP is now OFF)
  • Cash: $238.51
-$62.00 of this cash I reserve to D.C.A. KO
-$62.00 of this cash I reserve to D.C.A. JNJ
-$82.00 of this cash I reserve to D.C.A. MCD
-This leaves $32.51 cash available
  • Additional $56.00 available from slush fund
Investing Account Balance Since Inception
(Can be Enlarged):



Stock / Futures Trading Balance: $1,621.21
(YTD cash equity up about 1.566%. Return on Capital is 0%)
  • 3% risk tolerance gives us $48.63 to risk per trade
  • Additional $56.00 available from drawdown / slush fund
Trading Account Balance Since Inception:
(Can Be Enlarged)


Savings Balance: $225.30
(YTD cash equity up about 12.5%. Return on Capital is 0%)
  • $56.00 for a Slush fund / Drawdown Kill Switch fund
  • $113.30 for a Base Savings
  • $56.00 for Emergency Savings
Savings Account Balance Since Inception:
(Can Be Enlarged)



Total $500 Challenge Project Balance: $2,636.11

Total Challenge Account Growth Since Inception:
(Can Be Enlarged)


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 over 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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Saturday, January 9, 2010

Week in Review: Making Decisions without Predictions (PODCAST)

"Our fascination with projecting forward in spite of voluminous evidence in our ability to do so with any accuracy never ceases to amaze" - Jason Wood (Wood83) on Twitter

Welcome to the Week in Review!

I have mentioned before .... at length ... that I am not a trader or an investor who is 'into making predictions'. I don't predict, and won't predict. Many are 'into' predictions, when a new year arrives.

Then how do I approach making decisions in the capital markets? It's all about understanding 'where we are at today', which I discuss in the following podcast that reviews the capital markets for the week ...

(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's a chart of the Bond Curve as taken from Bloomberg ...



* * *

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 over 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.

Share

Friday, January 8, 2010

Friday Review for January 8th, 2010 (VIDEO)

"Patience and perseverance have a magical effect before which difficulties disappear and obstacles vanish." - John Quincy Adams, President of the United States

Here it is ... the second "Friday Review" video, that will review my investing and trading efforts for the last week, based off of comments in last weeks "Airelon's Market Tactics" ...

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



* * *

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 over 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.

Share

Tuesday, January 5, 2010

The Waiting Begins ...

That time of year has once again arrived ...

We begin to look ahead to tax time. Personally, I like to get my taxes done as soon as humanly possible.

Unfortunately, I'm a trader and investor.

Regardless of what any of us do for a living, we all have to wait for the tax documents to be shipped out by the responsible parties, which usually begins on January 31st. But investors and traders have a worse time of it than most folks. Because we have to wait for all of our brokers (and if you've been doing this for a while, there is this tendency to have quite a few brokers, which I do) to get all of our tax statements to us.

And it's not enough to have to wait for a myriad tax documents from different brokers. Usually the I.R.S. gives brokers longer to get tax documents out, than say, your regular corporate employer. In other words, if you work for an employer, then that employer must have your tax documents in the mail by January 31st. Not so with brokers. Your brokers are generally given more time. And even when they get you your tax documents? There's no telling that those are really your tax documents.

Because the number of times that I receive "corrections" to my statements weeks later? It's probably more often than I've received the actual, correct tax document the first time.

All of the above relates to a question I often receive on the part of new traders and new investors ...

"What do I need to 'do' for tax time?"

Biggest thing I can say after doing this for nearly 14 years?

Records. Keep excellent records.

If you keep up with it every single day? Then it's not hard to do. Again, I can't advise, as this is just a blog, and "I'm just a guy". But as a trader and investor of my own funds, this is what I've found I must keep track of ... every .... single ... day.
  • Date - There will be a portion of the taxes that you have to list every single trade and / or investment that you have made, and you'll thus need the date of each trade and / or investment.
  • Capital Description - Was it a trade? Was it an investment? Was it a dividend? I also write what I was trading or investing in this column. So I'll write things like "Div - JNJ" for Dividend, Johnson & Johnson. Or "Long 3 OJ" for going long in the OJ market.
  • Broker - I've just discovered that for my own record keeping? It's beneficial to keep track of which broker I made the transaction
  • Action - Was it a trade? Was it a trade buy to open? Was it a sell to close? Was it a sell to open (a short trade)? Was it a dividend received? I'll just write out things like "Buy - Trade to Open" or "Dividend" or "Exited investment".
  • DRIP (Dividend ReInvestment) Yes or No?
  • Shares or Number of Contracts: If I received a dividend, inside of a DRIP, I'll typically write something along the lines of "18.3845 shares @ $42.38495". In other words, this let's me know how many more shares I received, and at what price the DRIP was purchased. Trust me, when you finally sell off the investment for a profit? You need every single DRIP recorded for tax reasons. If it was a dividend, but there was no DRIP, I don't put anything in this column. If it was a futures contract, then I'll just write in the number of contracts, and the price I was filled, such as "3 at $13.51". If it was an equity trade, then I'll write the number of shares, and at what price I was filled, in other words, like "4000 shares at $18.50"
  • Amount: How much of the capital was spent? If I'm initiating a trade in futures? I write nothing in this column. If I'm closing a trade, then I write out the amount of the profit, or the loss in this column. If it's a dividend, then I write out how much the dividend (even if it was in a DRIP) the dividend was for all the shares.
  • Commission: I record the amount here, it it applies.
Just a simple spreadsheet for each transaction. It's not too hard.

The main thing is keeping up on the recordkeeping. I've discovered (the hard way of course), that if you let it get it away from you, then it can take a long time to catch up. Because the IRS demands that you list every single trade you make. It doesn't matter if you're a daytrader, and you have 2000 trades in a year. You must list them.

* * *

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 over 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, January 4, 2010

Monday Challenge Project Summary: January 4, 2010

Previous $500 Challenge Project Balances:

"The Three Sisters":

Investing "Sister" Balance: $799.13
Trading "Sister" Balance: $1,596.21
Interest Bearing "Sister" Balance: $200.30
Total Challenge Project Funds: $2,595.64

Introduction:
The original video explanation of the Challenge Project that began with $500, is to be found here. The Challenge Project is basically a demonstration of a model that anyone could at least follow along with on a weekly basis. It is my attempt without cost, to help out the 'little guy' when it comes to investing and trading by providing an example, a 'model' as it were ... as run by myself as a professional trader with real money, in sub-accounts that I own; following my own three sisters portfolio management system; albeit modified a bit to operate with low funds. From time to time, I provide snapshots of the broker statements.

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 Challenge Project TRADING Account.

Although I plan on showing the "Investing Sister" some love, as I have already stated I want to focus on the "Trading Sister" and the "Savings Sister" accounts this quarter.

The goal for the low funded at this stage of the game, is to get the "savings sister" account to a point, where the slush fund will be able to handle more than one loss in the trading account This will give us 'breathing room' and a better foundation, for the trading account to grow.

And now that we have arrived at the first trading day in 2010, the "Year to Date" gains and returns will reset. Therefore, the balances on the accounts, as they exist right now, is the 'starting point' from which we will mark forward the progress the rest of the year.

Here are the new balances for each of the Challenge Project ...

Challenge Project Balances After Rule No. 2 Deposit:

Investing Account Balance: $799.13
(YTD cash and equity is 0% Return is 0%)
  • 4.1665 shares of KO (DRIP on)
  • 3.0779 shares of JNJ (DRIP on)
  • 2 shares of MCD (DRIP is now OFF)
  • Cash: $238.51
-$62.00 of this cash I reserve to D.C.A. KO
-$62.00 of this cash I reserve to D.C.A. JNJ
-$82.00 of this cash I reserve to D.C.A. MCD
-This leaves $32.51 cash available
  • Additional $50.00 available from slush fund
Investing Account Balance Since Inception
(Can be Enlarged):


Stock / Futures Trading Balance: $1,621.21
(YTD cash equity up about 1.566%. Return on Capital is 0%)
  • 3% risk tolerance gives us $48.63 to risk per trade
  • Additional $50.00 available from drawdown / slush fund
Trading Account Balance Since Inception:
(Can Be Enlarged)


Savings Balance: $200.30
(YTD cash equity up about 0%. Return on Capital is 0%)
  • $50.00 for a Slush fund / Drawdown Kill Switch fund
  • $100.30 for a Base Savings
  • $50.00 for Emergency Savings
Savings Account Balance Since Inception:
(Can Be Enlarged)



Total $500 Challenge Project Balance: $2,620.65

Total Challenge Account Growth Since Inception:
(Can Be Enlarged)


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 over 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, January 2, 2010

Week in Review: "More than a Week in Review" (PODCAST)

"When you're in a pit, the first thing to do is to stop digging." - James Ellman, Seacliffe Capital

Welcome to the Week in Review!

Due to the fact that I've stopped trading for the last couple of weeks, I decided to forgo a "Week in Review" last week. So this week I talk about the action in the capital markets for the last week, as well as the week before that one.

And so much to talk about ... Gold ... silver ... assorted commodities, and of course, the credit markets ...

(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.

* * *

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 over 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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