Search This Blog

Wednesday, March 31, 2010

Talking the "Holy Grail" with Matt "Miss Trade" Davio

"A man must be big enough to admit his mistakes, smart enough to profit from them, and strong enough to correct them." - John C. Maxwell

Matt Davio has a site "Trading for the Masses". I had mentioned some time ago, he and Tamela Rich are writing a book that revolves around "trade offs". The title of the book will be ... "Tradeoffs: Leveraging the Longs & Shorts of Life". Matt and Tamela plan to write in the "language" that those of us who trade for a living use, and approach the concept of trade-offs when in comes to life. As Tamela described this book on her website, it will ... "frame life’s tradeoffs: time for money, freedom for convention, risk for reward, and money for goods and services."

Well, Matt has a section of "Trading for the Masses" that revolves around "Trader talk". A series of video interview series of young, old, and weathered traders of all shapes, walks, and colors. So some time ago, Matt Davio asked to sit down, and talk about many of these concepts and ideas. Money management as the "holy grail", trade offs and psychology and emotional discipline.

Here is that interview ...

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



I enjoyed the interview a lot.

I'll tell you ... I especially enjoyed that brief interchange we had regarding 'convention'. This business is so unconventional? That you may be surprised as to how those around you will react to you being a trader. It doesn't matter how successful you become. That career choice is always questioned by some folks.

As we mentioned ... others you may know in real life may 'shrug off' your chosen profession. I'm not exactly sure why that is? But it's a real phenomenon, trust me. I've had some question my own ethics, and my ability to provide for my family (and where I come from originally in the South? These are literal fighting words). I've had more people than I can count a) assume that I need more money, and b) try to arrange a "real" job for me. This, despite the fact that my net worth is greater than what they admit to me is theirs!!!!!. They simply dislike the freedom that I enjoy.

It's something to be aware of, if you are truly interesting in trading for a living. No matter how successful you become? One's will question the unconventionality of what it is that you've chosen to do.

* * *

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, March 29, 2010

Monday Challenge Project Summary: March 29, 2010 - What Has Been Accomplished?

Previous $500 Challenge Project Balances:

"The Three Sisters":

Investing "Sister" Balance: $822.48
Trading "Sister" Balance: $1,691.40
Interest Bearing "Sister" Balance: $400.30
Total Challenge Project Funds: $2,914.18

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, there will be no $25.00 weekly deposit. We've already used Rule No. 2 to the limit for the month of March, 2010.

We can however, talk about what has been accomplished thusfar for the Challenge Project. To do that, I thought I would have a vlog entry ...

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



Here are today's balances for each of the Challenge Project accounts ...

Challenge Project Balances After Rule No. 2 Deposit:

Investing Account Balance: $821.15 ($822.25)
(YTD cash is up +2.78% Return is +1.79% )
  • 5.1665 shares of KO (DRIP on)
  • 3.1014 shares of JNJ (DRIP on)
  • 2 shares of MCD (DRIP is now OFF)
  • Cash: $204.61
  • $1.10 of an MCD dividend was transferred to the trading "sister" account
-$5.10 of this cash I reserve to D.C.A. KO
-$64.00 of this cash I reserve to D.C.A. JNJ
-$84.00 of this cash I reserve to D.C.A. MCD
-This leaves $51.51 cash available
  • Additional $100.00 available from slush fund
Investing Account Balance Since Inception
(Can be Enlarged):


Stock / Futures Trading Balance: $1,691.40
(YTD cash and equity up about 5.89 % Return on Capital is 1.15 %)
  • 2% risk tolerance gives us $33.82 to risk per trade
  • 3% risk tolerance gives us $50.74 to risk per trade
  • Additional $100.00 available from drawdown / slush fund
Trading Account Balance Since Inception:
(Can Be Enlarged)


Savings Balance: $400.30
(YTD cash equity up about 99.87 % Return on Capital is 0 %)
  • $100.00 for a Slush fund / Drawdown Kill Switch fund
  • $200.30 for a Base Savings
  • $100.00 for Emergency Savings
Savings Account Balance Since Inception:
(Can Be Enlarged)



Total $500 Challenge Project Balance: $2,912.85

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


We'll be back to the Challenge Project next Monday, with the application of rule no. two for the month of April ...

* * *

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

Sunday, March 28, 2010

Week in Review: Dan's Report on Gold (PODCAST)

"I think basically an actor is a salesman." - Paul Lynde

Welcome to the Week in Review!

At the Happy Hour show on Friday, we had a discussion regarding Gold. So I thought that after our review of the capital markets, that this week for the podcast we could once again visit my thoughts in regards to the yellow metal. As follow is the Daily chart that we're looking at ...

Gold - Daily Chart
(Can be Enlarged):


(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.


Share

Saturday, March 27, 2010

Friday Investing and Trading Review for March 26th, 2010 (VIDEO)

"Now that you have put away falsehood, speak truth each one of you with his neighbor." - Ephesians 4:25, The bible

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".

(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

Thursday, March 25, 2010

Will. Go. Do.

"The true hero is flawed. The true test of a champion is not whether he can triumph, but whether he can overcome obstacles -preferably of his own making- in order to triumph." -Garth Stein

I've talked at length, in more blog posts than I can recount, for the reasons that I began this "blogging project". For the reasons that I began the passion project that is the "Challenge Project", found here at the blog.

Briefly stated ... just a few short years ago, day after day, I was sitting in front of my monitors. I'd make some money in the capital markets, and then I would proceed to go do what I wanted to do, which is help other people in my community.

But somehow, it seemed like I wasn't really helping to my fullest extent. As I have often mentioned, sitting in front of monitors, waiting for a Sugar trade order to fill? You have plenty of time on your hands. There seems to be a persistent myth that those who make money in the capital markets wouldn't have time to talk about their experiences publicly. Let me tell you something .... all you have is time when you are waiting for July 2010 Sugar to MOVE in one direction or another so that you can start managing the trade. (But that's a subject for another blog entry).

So I started this blog, which is really, my secular "passion project". I write this entry, as I'm waiting for a day order in the corn market to fill or not, as well as the Sugar market. So as I have the time ....

To those that know me in my day to day life? I'd often downplay what I do for a living for those that met me in real life. I still do. I was afraid of becoming known as "the money guy". And it's a fear I still hold to this day. My secular skill set? It involves running money. It's a great skill set to have when it comes to the practical matters of procuring life's necessities, while at the same time enjoying a great deal of freedom (That can be a two edged sword by the way, but that's a subject for another blog entry).

Unfortunately, it has the tendency to distance myself from other people.

"Dan runs money" or "Dan's a trader" and then ... "Dan's into money"

Nooooo.

Dan runs money. Dan's a trader. Dan's into people.

And I count myself as blessed that I have encountered so many interesting and fascinating people in this journey and gift we call life.

As you may have already noted on my facebook page, I was finally getting through some emails, and found one from a fellow trader I had the opportunity to meet some time ago ... Andre.

I'll share some of the email here ...

(Hey, I'm sorry, but if you email me, you take the risk of it showing up in public ... :) )

"This seemed right up your alley as you are the most altruistic capitalist I know ;) I say that lightheartedly w/o wanting to get into an altruism or "what Dan is" debate ;) ..." (We'll make that a subject for another blog entry) ... "I have a lot of respect for you as a person and what you've done for others and with the web. So, any comments or questions would be fantastic. If you merely pass it along, that would be helpful too."

Andre, it seems, has begun his own personal "passion project". He's calling it "Will. Go. Do." And Andre was right. This is right up my alley.

Because life cannot be about "money" and making "more money than everyone else". Life, should be about life. Life, is just that. Life. Sentient life, is about other people. It may sound 'redunantly enigmatic', but I'm sorry, that's the way I feel. After all, one day ... no one knows when ... our life can come to an end. My life will come to an end. There will be a "last second" for Dan Shy as a human. And life in this system of things is unfortunately chaotic at times. It can cause a great deal of tears and pain. It's an aspect of life I unfortunately know all too well.

And I want to feel in that last second of my life? That I 'went'. That I 'did'. That at every opportunity I had to do so? I chose people, over money. That I did my best, with the hand I was dealt to help others, and to enrich their lives.

So check out "Will. Go. Do."



* * *

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

Wednesday, March 24, 2010

Exciting "Trade off" Day in the Markets

"With one breath, with one flow ... You will know ... Synchronicity" - The Police

Hmmm.

You know ... it's interesting. Synchronicity that is.

As I mentioned in the "Week in Review" podcast, I just recently completed an interview with Matt "Miss Trade" Davio. It's not yet posted, but I'll repost here when Matt puts it up.

Anyways, I digress. Matt and Tamela Rich are writing a book that revolves around "trade offs". The title of the book will be ... Tradeoffs: Leveraging the Longs & Shorts of Life. Matt and Tamela plan to write in the "language" that those of us who trade for a living use, and approach the concept of trade-offs when in comes to life. As Tamela described this book on her website, it will ... "frame life’s tradeoffs: time for money, freedom for convention, risk for reward, and money for goods and services." Matt and I talked about that concept during the interview.

As I mentioned at the outset ... it's interesting how these topics and situations in life arise with so much synchronicity.

This morning, I volunteered my time, to spend with both my congregation, and my community. I assisted a young man of 19 this morning who asked for a bit of help. So I was away. It was a "trade off".

Yet as subscribers to my newsletter know, I was short on Gold, short on Silver, long on the dollar, short on Orange Juice futures, and short on Cotton. I'll let you look up the charts for yourself.

I won't lie. It's a bit painful to look at charts and realize that there were thousands of dollars to be made in a single day off of my own trading ideas that I saw coming. Perhaps tens of thousands of dollars, with the right sized account. But it's all a trade off.

I was telling Anthony Davian some time ago that I'm finding a new "high" when it comes to great trades. Because after some time? You sort of lose the excitement of a great week trading the capital markets. But there's a new excitement in allowing others to "look over my shoulder" as it were, to see my thought processes behind fantastic trades.

When I think back on March the 24th, 2010, it's a day that will never come again. It's over. And assisting a young man spiritually? Sorry ... but you can't put a price tag on that. I suppose that's an added benefit of writing "Airelon's Market Tactics". I may not personally be able to catch some of these moves, but at least I'm able to help others both in my community, and in the markets at the same time.

It's all a trade off after all.

* * *

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, March 22, 2010

Monday Challenge Project Summary: March 22, 2010

Previous $500 Challenge Project Balances:

"The Three Sisters":

Investing "Sister" Balance: $810.35
Trading "Sister" Balance: $1,690.30
Interest Bearing "Sister" Balance: $375.30
Total Challenge Project Funds: $2,875.95

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.

We end this quarter with a final addition to the side-pocket "savings sister" account. As you can note below, we have increased this account by 99.87%. Even with accounts at such tiny levels, important lessons are to be learned. This has been all about proper portfolio management.

You have to make decisions based on what's best for the future stability and growth of your portfolios.

Now take just a second, and take a look over the growth curve's of the capital in the graphs for the Challenge Project's "three sister" accounts

...

Note the difference between the growth of the capital curve between the different accounts?

Now obviously, because the "savings sister" account was so tiny, that the explosion in the growth curve has to do with deposits on top of a tiny account. But really, this explosion has to do, not only with the original size of the account, but focusing on using rule no. 2 towards strengthening this 'foundation' of the 'three sisters'.

And I'll say again, do you note the difference between the growth of the capital curve?

In the last quarter of 2009, the investing "sister" account enjoyed concentration from rule no. two. Thus, the growth curve is greater on the investing sisters for that time period. In this first quarter of 2010, we've focused of firming up the foundation of the challenge project overall, and thus the growth curve of the savings "sister" account has exploded upwards.

And there sits the poor ol' trading "sister". With a non-existent curve, with growth that is as flat as can be.

This is why for the second quarter of 2010, we'll focus on applying rule no. two towards the trading "sister" account. And with that focus shift, will also come trading opportunities, and accelerated growth for the Challenge project.

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

Challenge Project Balances After Rule No. 2 Deposit:

Investing Account Balance: $822.48 ($823.58)
(YTD cash and equity is up +3.00% Return is +1.79% )
  • 5.1665 shares of KO (DRIP on)
  • 3.1014 shares of JNJ (DRIP on)
  • 2 shares of MCD (DRIP is now OFF)
  • Cash: $204.61
  • $1.10 of an MCD dividend was transferred to the trading "sister" account
-$5.10 of this cash I reserve to D.C.A. KO
-$64.00 of this cash I reserve to D.C.A. JNJ
-$84.00 of this cash I reserve to D.C.A. MCD
-This leaves $51.51 cash available
  • Additional $100.00 available from slush fund
Investing Account Balance Since Inception
(Can be Enlarged):


Stock / Futures Trading Balance: $1,691.40
(YTD cash and equity up about 5.89 % Return on Capital is 1.15 %)
  • 2% risk tolerance gives us $33.82 to risk per trade
  • 3% risk tolerance gives us $50.74 to risk per trade
  • Additional $100.00 available from drawdown / slush fund
Trading Account Balance Since Inception:
(Can Be Enlarged)


Savings Balance: $400.30
(YTD cash equity up about 99.87 % Return on Capital is 0 %)
  • $100.00 for a Slush fund / Drawdown Kill Switch fund
  • $200.30 for a Base Savings
  • $100.00 for Emergency Savings
Savings Account Balance Since Inception:
(Can Be Enlarged)



Total $500 Challenge Project Balance: $2,914.18

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


We'll be back to the Challenge Project next Monday, with an entry responding to the question "What has been accomplished with the Challenge Project?" ...


* * *

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

Sunday, March 21, 2010

Week in Review: Rally's, Observation and Patience (PODCAST)

"The best interviews -- like the best biographies -- should sing the strangeness and variety of the human race." - Lynn Barber

Welcome to the Week in Review!

Each weekend I have a podcast in which I review not only the movements in the capital markets, but the financial news items that we've all seen for the last five days. As this is a blog for the newcomer, I try to break all of this down to make it somewhat easier to understand.

This has been a slow week for Dan. I had one profitable trade in Orange Juice, but other than that, this has been a week where I observe, more than I participate. I did have the chance to sit down and talk with Matt "Miss Trade" Davio for an interview on Thursday, and I talk a bit about that ...

(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.


Share

Saturday, March 20, 2010

Investing and Trading Review for March 20th, 2010 (VIDEO)

"You can observe a lot just by watching." - Yogi Berra

Here is weekly "Investing and Trading 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

Friday, March 19, 2010

Commodities Trading and Futures Speculation (Series): Contracts Specifications - Size and Limits (VIDEO)

"We must learn our limits. We are all something, but none of us are everything." - Blaise Pascal

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

Introduction: I discussed some of the myths regarding commodities speculation, and introduce the entire series.

The Reason for the Markets Existence: We discussed that the commodity futures markets exist, to allow companies, farmers, and others involved in production within the economy to hedge themselves against catastrophic losses. This in turn, keeps unemployment lower, and reduces volatility in the economy.

Why Traders Trade Commodities: Ok, if the commercial interests use the commodity markets to protect their business profits, then why are traders in those future markets? We discussed liquidity, and that the commercial interests need that trader liquidity, in order to hedge more efficiently. Without traders, the commercial interests have a very difficult time operating in the markets.

Collective Crowd Wisdom: We next discussed the free market benefits that traders bring to table while they are trading future delivery contracts.

Contacts and More Contracts: Is there some vast conspiracy, in that all commodity futures have more contracts trading in active months than there is the amount of that particular commodity in the world? Is the "Comex going to default"? No. It has to do with liquidity needs, and we discuss this.

Contract Specifications - Expiration:
You can hold Bank of America stock from now, until kingdom come. Commodity Future contracts on the other hand ... expire. We discussed this, and the nature of commodity future contracts in this vlog.

In today's entry, we discuss how the size of contracts affects what you need to trade those contracts, as well as "movement limits" that some contracts and commodities have ...

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



I'll have the "Friday Review" entry out tomorrow. I'm sorry folks, but it's just too beautiful outside ...

* * *

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, March 16, 2010

Commodities Trading and Futures Speculation (Series): Contracts Specifications - Expirations (VIDEO)

"Time does not change us. It just unfolds us." - Max Frisch

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

Introduction: I discussed some of the myths regarding commodities speculation, and introduce the entire series.

The Reason for the Markets Existence: We discussed that the commodity futures markets exist, to allow companies, farmers, and others involved in production within the economy to hedge themselves against catastrophic losses. This in turn, keeps unemployment lower, and reduces volatility in the economy.

Why Traders Trade Commodities: Ok, if the commercial interests use the commodity markets to protect their business profits, then why are traders in those future markets? We discussed liquidity, and that the commercial interests need that trader liquidity, in order to hedge more efficiently. Without traders, the commercial interests have a very difficult time operating in the markets.

Collective Crowd Wisdom: We next discussed the free market benefits that traders bring to table while they are trading future delivery contracts.

Contacts and More Contracts: Is there some vast conspiracy, in that all commodity futures have more contracts trading in active months than there is the amount of that particular commodity in the world? Is the "Comex going to default"? No. It has to do with liquidity needs, and we discuss this.

In the next few videos, I want to discuss contract specifications in greater detail. In the following vlog entry, I discuss my thoughts regarding the expiring nature of any given commodity ...

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



In the next vlog entry in this series, we will discuss contract sizes, and contract limits.

* * *

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, March 15, 2010

Monday Challenge Project Summary: March 15, 2010

Previous $500 Challenge Project Balances:

"The Three Sisters":

Investing "Sister" Balance: $811.67
Trading "Sister" Balance: $1,690.30
Interest Bearing "Sister" Balance: $350.30
Total Challenge Project Funds: $2,852.27

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.

We are entering the home stretch. Just a few more additions to the "savings sister" account, and we'll be in a better position.

What exactly does 'better position' mean? Once again, this refers to how many trades we can take in the "Trading Sister" account before the drawdown "kill switch" is hit. If the "savings sister" account has about $100 apportioned for the side-pocket "kill switch" slush fund, then that allows for about 3 consecutive scalping losses in terms of trades.

As well, it's important to note that we received more partial shares for our Johnson & Johnson (JNJ) holdings, as the dividend showed up in the accounts last Tuesday.

Mid-Day Edit: Oh, and $1.10 showed up today for the McDonalds (MCD) dividend. I'm transferring this $1.10 to the trading "sister" account.

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

Challenge Project Balances After Rule No. 2 Deposit:

Investing Account Balance: $810.35
(YTD cash and equity is up +1.4% Return is +0.16% )
  • 5.1665 shares of KO (DRIP on)
  • 3.1014 shares of JNJ (DRIP on)
  • 2 shares of MCD (DRIP is now OFF)
  • Cash: $204.61
-$5.10 of this cash I reserve to D.C.A. KO
-$64.00 of this cash I reserve to D.C.A. JNJ
-$84.00 of this cash I reserve to D.C.A. MCD
-This leaves $51.51 cash available
  • Additional $93.00 available from slush fund
Investing Account Balance Since Inception
(Can be Enlarged):


Stock / Futures Trading Balance: $1,690.30
(YTD cash and equity up about 5.89 % Return on Capital is 1.15 %)
  • 2% risk tolerance gives us $33.80 to risk per trade
  • 3% risk tolerance gives us $50.70 to risk per trade
  • Additional $93.00 available from drawdown / slush fund
Trading Account Balance Since Inception:
(Can Be Enlarged)


Savings Balance: $375.30
(YTD cash equity up about 87.36 % Return on Capital is 0 %)
  • $93.00 for a Slush fund / Drawdown Kill Switch fund
  • $189.30 for a Base Savings
  • $93.00 for Emergency Savings
Savings Account Balance Since Inception:
(Can Be Enlarged)


(Yes, I figured out a way to generate a graph for the history of the Savings account from Quicken)

Total $500 Challenge Project Balance: $2,875.95

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.


Share

Saturday, March 13, 2010

Week in Review: Shipping and Repos (PODCAST)

"For most folks, no news is good news; for the press, good news is not news." - Gloria Borger

Welcome to the Week in Review!

Each weekend I have a podcast in which I review not only the movements in the capital markets, but the financial news items that we've all seen for the last five days. As this is a blog for the newcomer, I try to break all of this down to make it somewhat easier to understand.

I thought I'd start off with a bit of good news that I've been watching in the shipping sector. After reviewing the capital markets, I offer my thoughts on the entire Lehman "Repo 105" report.

(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.


Share

Friday, March 12, 2010

Friday Investing and Trading Review for March 12th, 2010 (VIDEO)

"Carpe diem quam minime credula postero" - Quintus Horatius Flaccus

"Meam amare matrem"


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".

(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

Wednesday, March 10, 2010

Managing Energy to Enthusiasm (PODCAST)

"Drive away the ridiculer, that contention may go out and that legal contest and dishonor may cease." - Proverbs 22:10, The Bible

This podcast sort of follows the comments from my previous vlog entry on 'Trading the "Right" Way'. Basically, it comes down to the fact, that I have no idea why some feel the need for 'snarky' comments. And you truly do have to be careful of such 'environments'. Because believe you me, in the end, it will affect your 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 is the link, to the entry by Don Miller that I thought was priceless.

* * *

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, March 9, 2010

Trading the "Right" Way (VIDEO)

"For me context is the key - from that comes the understanding of everything." - Kenneth Noland

Traders develop different rule sets for themselves, according to their chosen methodology; that usually "fits them" psychologically. At times, they will discuss these 'trading rule sets' with others, or in public.

A problem arises when you may hear two different, yet profitable traders discuss 'rule sets' that seem to be in contradiction with one another. I discuss this 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 ...)



If we wanted to include long term investors in the above scenario, we could continue that conversation even further. Because investors always buy weakness, and never buy strength. In fact, this is what separates good investors from bad investors. A good investor buy's weakness.

But for a momentum trader to buy weakness because a investor buys weakness and is profitable? It would be a disaster for the momentum trader.

I will continue these thoughts in a podcast entry "Managing Energy to Enthusiasm".

* * *

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, March 8, 2010

Monday Challenge Project Summary: March 8, 2010

Previous $500 Challenge Project Balances:

"The Three Sisters":

Investing "Sister" Balance: $798.60
Trading "Sister" Balance: $1,679.23
Interest Bearing "Sister" Balance: $325.30
Total Challenge Project Funds: $2,803.13

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.

Yes, we are now entering the last 'phase' of strengthening the "Savings Sister Account" for the Challenge Project. The last quarter of 2009, it was all about strengthening the "Investing Sister Account". This quarter, we've been strengthening our ability to 'trade', by strengthening the savings 'sister' account. And we are now entering the last few weeks of that endeavour.

As well, we had another brief trade last week (with due nods to Anthony Davian on that UNG trade he mentioned in Twitter). In fact, here is a snapshot of the trade as it shows up in the account log ...

Trading Account Broker Summary
(Can be Enlarged):

Our goal is still to build up the trading account before we have more trades, and to be sure, we will be doing this very soon. In fact, before too much longer, instead of seeing week after week of 'strengthening that old boring savings sister', you'll see week after week of deposits to the "trading account" of the Challenge project.

"All things in good time" as they say.

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

Challenge Project Balances After Rule No. 2 Deposit:

Investing Account Balance: $811.67
(YTD cash and equity is up +1.57% Return is +0.51% )
  • 5.1665 shares of KO (DRIP on)
  • 3.0779 shares of JNJ (DRIP on)
  • 2 shares of MCD (DRIP is now OFF)
  • Cash: $204.61
-$5.10 of this cash I reserve to D.C.A. KO
-$64.00 of this cash I reserve to D.C.A. JNJ
-$84.00 of this cash I reserve to D.C.A. MCD
-This leaves $51.51 cash available
  • Additional $87.00 available from slush fund
Investing Account Balance Since Inception
(Can be Enlarged):


Stock / Futures Trading Balance: $1,690.30
(YTD cash and equity up about 5.89 % Return on Capital is 1.15 %)
  • 2% risk tolerance gives us $33.80 to risk per trade
  • 3% risk tolerance gives us $50.70 to risk per trade
  • Additional $87.00 available from drawdown / slush fund
Trading Account Balance Since Inception:
(Can Be Enlarged)


Savings Balance: $350.30
(YTD cash equity up about 74.89 % Return on Capital is 0 %)
  • $87.00 for a Slush fund / Drawdown Kill Switch fund
  • $176.30 for a Base Savings
  • $87.00 for Emergency Savings
Savings Account Balance Since Inception:
(Can Be Enlarged)


Total $500 Challenge Project Balance: $2,852.27

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.


Share

Sunday, March 7, 2010

Week in Review: Yes, Dan is Still Alive ... (PODCAST)

"He that can't endure the bad will not live to see the good." - Jewish Proverb

Welcome to the Week in Review!

It's been a rather quiet week. I did have one blog post over at the Davian Letter, and as I mentioned yesterday, one trade for the Challenge Project.

But much of this week, was a "recovery week" for Dan ...

(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.


Share

Friday, March 5, 2010

Friday Investing and Trading Review for March 5th, 2010 (VIDEO)

"Discipline is the refining fire by which talent becomes ability." - Roy L. Smith

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".

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



The "Week in Review" podcast will appear this week on this Sunday, March 7th.

* * *

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, March 1, 2010

Monday Challenge Project Summary: March 1, 2010

Previous $500 Challenge Project Balances:

"The Three Sisters":

Investing "Sister" Balance: $818.37
Trading "Sister" Balance: $1,654.23
Interest Bearing "Sister" Balance: $325.30
Total Challenge Project Funds: $2,797.90

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.

Yes, from time to time, 'firming up the foundation of the Trading 'sister' account' actually means that rule no. 2 can be applied to the ... trading account! Fancy that.

This means that the trading account has seen an increase of 5.2% in it's trading capital year to date, and the last trade in the trading account was a profitable win. But I'm still not content. $1,679.23 is still a tiny, tiny account to be trading. I'm shooting for an increase of about 14%, or about $1,819.00 or so, one way or another, by July of this year. Expect to see that rule no. two is applied so that such increases occur in the trading account itself in the next quarter.

But before that can occur, expect to see some more love shown to the "Savings Sister" by the end of the quarter. I believe that I have made mention that I'd like the "sidepocket" or "slush fund" to be able to backstop two trading losses, so that's the goal I'm reading for while we are still within this 'tiny' phase.

Turning to the Investing Account ... the stock value of Coca-Cola (KO) got hit hard, but basically, this is transaction in which Coca-Cola (KO) does not have to put out any of it's cash, thus, it's a "cashless transaction" (remember, this blog is for the newcomer). It's a win, win, win for this stock in the long term, and anyone not long Coca-Cola (KO) gets a huge gift with this slice off of the stocks value in the short term.

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

Challenge Project Balances After Rule No. 2 Deposit:

Investing Account Balance: $798.60
(YTD cash and equity is up -0.056% Return is -1.1% )
  • 5.1665 shares of KO (DRIP on)
  • 3.0779 shares of JNJ (DRIP on)
  • 2 shares of MCD (DRIP is now OFF)
  • Cash: $204.61
-$5.10 of this cash I reserve to D.C.A. KO
-$64.00 of this cash I reserve to D.C.A. JNJ
-$84.00 of this cash I reserve to D.C.A. MCD
-This leaves $51.51 cash available
  • Additional $81.00 available from slush fund
Investing Account Balance Since Inception
(Can be Enlarged):


Stock / Futures Trading Balance: $1,679.23
(YTD cash and equity up about 5.2 % Return on Capital is 0.5 %)
  • 3% risk tolerance gives us $50.37 to risk per trade
  • Additional $81.00 available from drawdown / slush fund
Trading Account Balance Since Inception:
(Can Be Enlarged)


Savings Balance: $325.30
(YTD cash equity up about 62.45 % Return on Capital is 0 %)
  • $81.00 for a Slush fund / Drawdown Kill Switch fund
  • $163.30 for a Base Savings
  • $81.00 for Emergency Savings
Savings Account Balance Since Inception:
(Can Be Enlarged)


Total $500 Challenge Project Balance: $2,803.13

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.


Share

Search Investing and Trading Articles and Products