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Sunday, October 31, 2010

Wedding Weekend Celebrations ...

There was no week in review podcast this weekend, as this weekend, we've been celebrating the marriage of my wife's brother and his fiance. Celebrations bring their own time to relax, and time to enjoy the miraculous events we experience within life.

My Brother-in-Law, the Groom
and his Sister, Mrs. Airelon

It leaves very little time for anything else however. Quite frankly, it made for some very, very late nights. On Friday night we had the rehearsal for the wedding, and the subsequent rehearsal dinner. After which some close friends retired back to my house for some beer, and conversation.

On Saturday was the wedding itself; with associated reception ...

My buddy and I at the reception

The reception was not enough however, so again, I grabbed my wife, a few close friends, and again we headed back to our house for conversation and something to drink in a bit more 'quiet' a venue.

Mr. and Mrs. Airelon


We'll be back to our regularly scheduled blog tomorrow with the "Challenge Project" entry ...

Wednesday, October 27, 2010

Trading Tools: Money Management and Options Trading (LINK and VIDEO)

A subscriber of mine, comosgato on YouTube, shared a couple of tools with me when he found them. I thought them both so important for new traders and new investors, that I wanted to share them with everyone here on the blog.

The first is a link. Be forewarned, it is to a commercial site. But the tool in and of itself, I believe, is critical to help people see just how important attaining healthy money management metrics will be to their trading and profitability; via a probability simulation.

The second tool, is actually an educational video, that has to do with the implied probability in determining option pricing. As I discussed in my "Options Playlist" (which is in serious need of being remade) ... options have different components that make up their price, and these components can fluctuate. Here is the link to the video that explains implied probability and options trading.

* * *

Note: This is not an investment or trading recommendation. The losses in trading can be very real, and depending on the investment vehicle, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. But I do have 14 years of experience in trading and investing in these markets. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research, and tolerance for risk.

Tuesday, October 26, 2010

"If I'm gonna get busted, it is NOT gonna be by a guy like THAT"

"For mere oppression may make a wise one act crazy" - Ecclesiastes 7:7, The Bible

I realize that some of my comments in the twitter stream may have sounded somewhat ... harsh ... lately.

As I have mentioned, on more than one occasion, that forms and tools of social media that are used to network one's 'presence' across the net come with their own unique sets of aggravations.

One of the biggest aggravations is that someone will remember something that I wrote or said ... say ... a year ago. I am then somehow pigeon-holed into a particular 'camp' or ideology that I do not belong to. For the record ... I am not a 'deflationist'. I still maintain that we have been crawling out of a deflationary trap. But good grief, an economic trap is a scenario, or type of environment. It does not describe with full detail what will occur with the mark in asset prices. Since September 25th, I've been discussing the return of inflation, possibly sooner if you count some of my earlier side comments that I had my eye beginning to turn in that direction.

Another aggravation of social media, is the tendency that people have to self-assign criticism that was not intended for them. So at times, I'll see something completely stupid, and comment on it. And I'm sorry, but when you see something completely insane? It's pretty hard to keep your mouth shut. Especially if you are as naturally gregarious, as I am. Unfortunately, for some reason, people tend to believe I'm talking about them, or something they said.

Chances are ... I'm not. Many times, it may be a media piece that I saw. So please rest easy on that route.

But I'm sorry, it never ceases to amaze me, and probably will never cease to amaze me ... how many absolutely stupid people are given millions and millions of dollars in this industry, to pursue equally idiotic economic concepts that were mathematically and scientifically proven false decades ago. I try to remember the Christian admonition that knowledge puffs up, whereas love builds up. But at times, it's hard, and I'm only human.

So for the record, and just so I can get this off my chest in a blogging venue, rather than 28 separate tweets ...

Dan is not a deflationist.

Dan is not an inflationist.

Full utilization has never been the intention of stimulus, from the foundation of Keynes work. Every economist since Keynes, and including Keynes knew this.

Dan is not a Keynesian.

Dan is not an "ian" anything, other than a "Christian", or hold to any form of 'ism'. To borrow a line from Ferris Beuller ... "isms in my opinion are not good. person should not believe in an -ism, he should believe in himself. I quote John Lennon, "I don't believe in Beatles, I just believe in me." Good point there. After all, he was the walrus."

There is a difference between supply, liquidity and volume; and if you are going to comment on economic metrics with the intention of advice or commentary then you should know the difference.

If someone states that "The United States is Zimbabwe" then they can be completely ignored. This should be self-evident to any individual with the powers of observation available to a 5 year old. They are not more intelligent. They don't have special insight. They are merely parroting what they heard someone else say because they were so unoriginal they could not comment with their own thoughts on the economy ...




* * *

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 14 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, October 25, 2010

Monday Challenge Project Summary: October 25th, 2010 (VIDEO)

Previous $500 Challenge Project Balances:

"The Three Sisters":

Investing "Sister" Balance: $937.07
Trading "Sister" Balance: $2,119.63
Side-pocket Savings "Sister" Balance: $550.30

Total Challenge Project Funds: $3,607.00


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 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. We split up Rule No. 2, into weekly segments; or $25.00 a week. As I mentioned on August 10th, I am in the processing of liquidating my own personal accounts, and will soon be trading this 'Challenge Project', full time.

For this week, the $25.00 weekly deposit is being transferred to the Challenge Project SIDE-POCKET SAVINGS Account.

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




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

Challenge Project Balances After Rule No. 2 Deposit:

Goals for Each Account By the Time I Trade Challenge Project Full Time
  • Investing Account: More cash, will evaluate
  • Trading Account: $2,400.00
  • Savings Side-Pocket Account: $800.30
Investing Account Balance: $948.78
(YTD the account is +18.73% YTD Return is about +10.44% Continuing Yield is approximately +6.96% in cash dividends and additional shares of stock)
  • 6.2685 shares of KO (DRIP is on for 4.2685 shares)
  • 5.158 shares of JNJ (DRIP is on for 3.158 shares)
  • Cash: $233.45
-$ 1.00 of this cash I reserve for 'maneuvering' capital
-$ 6.88 of this cash I reserve to D.C.A. KO

-$17.00 of this cash I reserve to D.C.A. JNJ
-This leaves $208.57 cash available for a new purchase
  • Additional $143.00 available from slush fund, up to $1,091.78
Investing Account Balance Since Inception
(Can be Enlarged):


Stock / Futures Trading Balance: $2,119.63
( YTD cash contributions, equity and return up about 32.79 % )
  • 2% risk tolerance gives us $42.39 'at risk' levels
  • 3% risk tolerance gives us $63.58 'at risk' levels
  • Additional $143.00 available from draw-down / slush fund, to $2,262.63
Trading Account Balance Since Inception:
(Can Be Enlarged)

Savings Side-Pocket Balance: $575.30
(YTD cash equity up about 187.2 % Return on Capital is 0 %)
  • $143.00 for a Slush fund / Draw-down Kill Switch fund
  • $289.30 for a Base Savings
  • $143.00 for Emergency Savings
Savings Side-Pocket Account Balance Since Inception:
(Can Be Enlarged)


Total $500 Challenge Project Balance: $3,643.71

* * *

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 14 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.

Sunday, October 24, 2010

Week in Review: Economic Trading, Populist Anger and DX Tomfoolery? (PODCAST)

"He that is quick to anger will commit foolishness, but the man of thinking abilities is hated. The inexperienced ones will certainly take possession of foolishness, but the shrewd ones will bear knowledge as a headdress" - Proverbs 14:17,18, The Bible

Welcome to the Week in Week in Review podcast!

This week I'm going to review my trading efforts, and how I incorporate my economic thoughts as a type of 'edge' when it comes to trading the markets. I discuss the ever growing populist anger, as well as just some crazy weird moves limited to the U.S. Dollar Index futures for the December contract.

(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.

If you prefer the YouTube video version, I have included that as well ...

(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 14 years of experience in trading and investing in these markets. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research, and tolerance for risk.

Wednesday, October 20, 2010

Johnson & Johnson (JNJ) and Coca-Cola (KO)

Watch it ... love it ...

Bought Johnson and Johnson (JNJ) publicly at $60.00 ish (and talked about $57.00 averaging). Bought Coca-Cola (KO) publicly back at $53.90, and then averaged in again at $51.27 for an average of about $52.40 ish.

Watch it ... love it ... Been DRIP'ing these stocks dividends for some time as long time blog readers know.

Coca-Cola (KO) - Daily
Entering the Realms of Ridiculous

Johnson & Johnson (JNJ)
Not Ridiculous - But merely Silly



I heard "Dasan" once say that this is a business that you get paid for being uncomfortable. I was uncomfortable averaging down on both of them, and now I'm uncomfortable that these things have rallied to absolutely ridiculous levels.

But I'm making money and yield with both of them.

And yes, I view yield of purchase as something completely separate from 'making money'.

* * *

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 14 years of experience in trading and investing in these markets. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research, and tolerance for risk.

Tuesday, October 19, 2010

The $4,000 Question for Commodity Futures Trading with ThinkorSwim, and the Challenge Project

On October 11, 2010, I discussed a 'type' of problem that I've run across with ThinkorSwim. A subscriber informed me that he had been told that he would not be allowed to trade commodity futures unless his account balance was at $4,000.00.

Which obviously put me in an interesting position. I had planned, as the account began to approach $3,000.00, to begin to start some small trades with commodity futures. Brief trades, only lasting a day, in some very liquid markets with a tight spread. These are not trades that would occur very often either, as I would still be using rule no. two, even after a successful, profitable trade to 'buttress' the account.

So I decided to write them an email, which is as follows ...

"Dear Sir or Madam,

The purpose of this email to that I am seeking clarification.

Before I opened my account with ThinkorSwim, I communicated with customer support to make sure that my opening balance would be no problem. I was told that although ThinkorSwim preferred $3,500, someone with my experience level would be able to trade Futures with $2,000.00. I let customer support know that these accounts were being used as a "model" on my blog, and that I was operating on a given rule set.

That margin account now exceeds $2,000.00, although I have not traded with it. As I mentioned in my blog entry Monday when discussing ThinkorSwim, I actually have no intentions of trading commodity futures (naturally only those whose margin requirements I currently meet) with that account. Not for some time. The $25.00 deposits have been following the rules that I outlined on the blog; in an attempt to demonstrate what has worked so well for me over many years.

I can assure you that as that account only has $2,094.63 (With most recent deposit clearing, will be $2,119.63) at the present time, I am not interested in actively trading that account. At all. But a subscriber contacted me, and informed me that he had been told that he was told that unless he had $5,000.00 - he could not trade any commodity futures. So this subscriber asked me how I was able to trade at all. To be quite honest, I was a bit stumped as I had thought up to this point, I thought I had already qualified for futures trading. I don't want to trade actively some commodity futures with such a small account. But I was told when opening the account, that the account would be a futures trading account.

So is my main margin account a commodity futures trading account? I had already assumed it was due to my experience level, although I'm not really interested in trading too much, with such a pittance currently in that account, until the account grows with the rules that I had outlined for myself. But if I'm sitting on $3,600, and I see a trade and decide to take it ... is the account going to be ready for such a trade?

I am seeking clarification on this issue, and I thank you in advance ..."

The response is as follows ...

"Hi Dan,

Thanks for the email. In a margin account you can trade stocks and options. In a margin account, you may also apply for futures trading. Hope this helps and please feel free to contact us anytime.

Kind Regards,"

I have to be honest. I'm not too impressed with that reply. They answered one question, but did not address any of my concerns.

So what's the plan?

It seems, from that email, that I would have to apply for commodity futures trading (which sitting here, is a bit funny to me ... but I guess this does put me back in the realm of those starting out). I will put in this "application" (the quotes are meant with disdain, as I do find it a bit insulting) when I am facing a situation where I would put in an order.

In other words, I'll just proceed as if I had futures trading capability. When a trading opportunity arises? I'll put the application in; although I do not expect to receive a reply by the time that I would execute the trade. I'll just wait for the 'first' opportunity to arise. By waiting thus, I can apply rule no. two in the meantime to that trading account, and built it up regardless.

Depending on the result of that application, when it's made, will depend on which direction I will take 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 14 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, October 18, 2010

Monday Challenge Project Summary: October 18th, 2010 (VIDEO)

Previous $500 Challenge Project Balances:

"The Three Sisters":

Investing "Sister" Balance: $932.03
Trading "Sister" Balance: $2,119.63
Side-pocket Savings "Sister" Balance: $525.30

Total Challenge Project Funds: $3,576.96


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 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. We split up Rule No. 2, into weekly segments; or $25.00 a week. As I mentioned on August 10th, I am in the processing of liquidating my own personal accounts, and will soon be trading this 'Challenge Project', full time.

For this week, the $25.00 weekly deposit is being transferred to the Challenge Project SIDE-POCKET SAVINGS Account.

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



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

Challenge Project Balances After Rule No. 2 Deposit:

Goals for Each Account By the Time I Trade Challenge Project Full Time
  • Investing Account: More cash, will evaluate
  • Trading Account: $2,400.00
  • Savings Side-Pocket Account: $800.30
Investing Account Balance: $937.07
(YTD the account is +17.26% YTD Return is about +9.078% Continuing Yield is approximately +6.96% in cash dividends and additional shares of stock)
  • 6.2685 shares of KO (DRIP is on for 4.2685 shares)
  • 5.158 shares of JNJ (DRIP is on for 3.158 shares)
  • Cash: $233.45
-$ 1.00 of this cash I reserve for 'maneuvering' capital
-$ 6.88 of this cash I reserve to D.C.A. KO

-$17.00 of this cash I reserve to D.C.A. JNJ
-This leaves $208.57 cash available for a new purchase
  • Additional $137.00 available from slush fund, up to $1,074.07
Investing Account Balance Since Inception
(Can be Enlarged):


Stock / Futures Trading Balance: $2,119.63
( YTD cash contributions, equity and return up about 32.79 % )
  • 2% risk tolerance gives us $42.39 'at risk' levels
  • 3% risk tolerance gives us $63.58 'at risk' levels
  • Additional $137.00 available from draw-down / slush fund, to $2,256.63
Trading Account Balance Since Inception:
(Can Be Enlarged)

Savings Side-Pocket Balance: $550.30
(YTD cash equity up about 174.7 % Return on Capital is 0 %)
  • $137.00 for a Slush fund / Draw-down Kill Switch fund
  • $276.30 for a Base Savings
  • $137.00 for Emergency Savings
Savings Side-Pocket Account Balance Since Inception:
(Can Be Enlarged)


Total $500 Challenge Project Balance: $3,607.00

* * *

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 14 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, October 16, 2010

Week in Review: Rants, Zimbabwe and Intermarket Relationships (PODCAST)

"Accuracy of observation is the equivalent of accuracy of thinking. " - Wallace Stevens

Welcome to the Week in Week in Review podcast!

I've been rather productive this past week on the blogging route. I discuss a few of those blog entries in greater detail, as well as an explanation of why I had no trades last 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.

If you prefer the YouTube video version, I have included that as well ...

(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 14 years of experience in trading and investing in these markets. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research, and tolerance for risk.

Friday, October 15, 2010

The United States is Zimbabwe !! (VIDEO)

"The supreme irony of the Information Age is that it gives new respectability to uninformed opinion."

I said it not 23 days ago.

Twenty three days.

I discussed lower prices on the U.S. Dollar, and when that happened, the 'blather-panic' would begin. The same thing happened last year. And the year before that. I could find articles on how hyperinflation is going to happen in the U.S. clear back to 1983.

In the following video, I discuss one of the most common fallacies regarding the state of the U.S. Dollar as a currency at the moment.

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



If hyperinflation were to occur? That is, a continuing, building, exponential increase in inflation?

It'd be the end of all modern economies.

* * *

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 14 years of experience in trading and investing in these markets. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research, and tolerance for risk.

Wednesday, October 13, 2010

How to Begin (Series): Trading Podcast: Working While Trading (PODCAST)

"A schedule defends from chaos and whim. It is a net for catching days. It is a scaffolding on which a worker can stand and labor with both hands at sections of time. " - Annie Dillard

From time to time, I publish mid-week podcasts. Usually, these podcasts address specific questions that I receive.

This podcast will address one such question.

How does one work at a place of employment, as well as trade? I offer my own observations in the following podcast ...

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




Click here download this podcast.

Or, if you prefer, I've also included this as a video, and placed it within the "How to Begin" series, or playlist. That playlist can be found through this link on blip.tv.

(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 14 years of experience in trading and investing in these markets. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research, and tolerance for risk.

Tuesday, October 12, 2010

Airelon's Holy Gospel Hour: Want to be My "Get Rich" Spamming Mechanism? (VIDEO)

"And introduce an element of cynicism and darkness into it and just realize that we're all vulnerable. We are humans. There is a finite end to this life and we're all going to face it and a little silliness can help. " - Alan Thicke

Those who subscribe know that from time to time, a "Airelon's Holy Gospel Hour" is possible. Bit of a humorous side tangent, with a bit of anger thrown in. Ok, well ... a lot of anger thrown in.

These "Gospel Holy Hours" arise from a 10th grade Architecture teacher of mine. He was 27. But we were High Schoolers. We gave him a ton of aggravation. Every once in a while - when we had gotten to be too much for him? He'd lose it.

"You can all sit down, and shut up. I've had about all I can take. So you get to listen to me rant, on the K. Jabe Gospel Hour. What is it with you guys? . . . . ."

And off he'd go. For the full hour. Decrying the lunacy that was going on around him.

I understand that teacher so much better now. I had another "Gospel Hour" as can be seen here . . .

Current Target: The aggravation of dealing with "internet tools"

(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 14 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, October 11, 2010

Monday Challenge Project Summary: October 11th, 2010 (VIDEO)

Previous $500 Challenge Project Balances:

"The Three Sisters":

Investing "Sister" Balance: $922.55
Trading "Sister" Balance: $2,094.63
Side-pocket Savings "Sister" Balance: $525.30

Total Challenge Project Funds: $3,542.48


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 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. We split up Rule No. 2, into weekly segments; or $25.00 a week. As I mentioned on August 10th, I am in the processing of liquidating my own personal accounts, and will soon be trading this 'Challenge Project', full time.

For this week, the $25.00 weekly deposit is being transferred to the Challenge Project TRADING Account.

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



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

Challenge Project Balances After Rule No. 2 Deposit:

Goals for Each Account By the Time I Trade Challenge Project Full Time
  • Investing Account: More cash, will evaluate
  • Trading Account: $2,400.00
  • Savings Side-Pocket Account: $800.30
Investing Account Balance: $932.03
(YTD the account is +16.63% YTD Return is about +8.492% Continuing Yield is approximately +6.96% in cash dividends and additional shares of stock)
  • 6.2685 shares of KO (DRIP is on for 4.2685 shares)
  • 5.158 shares of JNJ (DRIP is on for 3.158 shares)
  • Cash: $233.45
-$ 1.00 of this cash I reserve for 'maneuvering' capital
-$ 6.88 of this cash I reserve to D.C.A. KO

-$17.00 of this cash I reserve to D.C.A. JNJ
-This leaves $208.57 cash available for a new purchase
  • Additional $131.00 available from slush fund, up to $1,053.55
Investing Account Balance Since Inception
(Can be Enlarged):


Stock / Futures Trading Balance: $2,119.63
( YTD cash contributions, equity and return up about 32.79 % )
  • 2% risk tolerance gives us $42.39 'at risk' levels
  • 3% risk tolerance gives us $63.58 'at risk' levels
  • Additional $131.00 available from drawdown / slush fund, to $2,250.63
Trading Account Balance Since Inception:
(Can Be Enlarged)

Savings Side-Pocket Balance: $525.30
(YTD cash equity up about 162.3 % Return on Capital is 0 %)
  • $131.00 for a Slush fund / Drawdown Kill Switch fund
  • $263.30 for a Base Savings
  • $131.00 for Emergency Savings
Savings Side-Pocket Account Balance Since Inception:
(Can Be Enlarged)


Total $500 Challenge Project Balance: $3,576.96

* * *

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 14 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.

Sunday, October 10, 2010

All Fixed Up ...

It seems last night, the file that contained the "Week in Review" podcast became corrupted. Thus ... some folks could not play the podcast.

I've since replaced the file, and tested it several times, so it seems to be working. Once again, the link to that podcast can be found here ...

Saturday, October 9, 2010

Week in Review: Quantitative Easing, Inflation, and Currency Wars (PODCAST)

"To see victory only when it is within the knowledge of the common mob is not the acme of excellence." - Sun Tzu, the Art of War

Welcome to the Week in Week in Review podcast!

With my vacation to the families cottage in Pennsylvania ... it's been a couple of weeks since I had the last podcast. This week I want to discuss those three topics as they relate to the capital markets ...

Quantitative easing: What exactly quantitative easing is, what it is not, what the hopes are for a second round of Quantitative easing

Inflation: During conversations of deflation last year, I tried to tell ones over and over again, that I am not a 'deflationist'. I was all over inflation in 2007. I would often say that when inflation comes back, I'll be one of the first guys talking about it.

And I was.

But we'll also talk about how inflation relates to recent conversations on this blog regarding psychology.

Currency Wars: What is a currency war? Why try to devalue a currency? What's the benefit? What is the danger, especially in this environment?

(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.

If you're having a problem playing the podcast (I'm checking into this with podbean), then you can find the YouTube version here ...

(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 14 years of experience in trading and investing in these markets. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research, and tolerance for risk.

Friday, October 8, 2010

Airelon's Trading Methodology (Series): Approaching Trend Exploitation (VIDEO)

"It's not about the 'one' trade. It's about the 'many trades'" - Personal Mantra

So I put together a new playlist, or series of videos, that discusses my own trading style and methodology. The blip.tv. version of this series can be found here.

And to date, that series is pretty much complete. But I've found that there are concepts that for me are instinctual? That I sometimes forget to fully explain, because I find them to be somewhat an instinctual concept ... that I just 'know'.

Today, I want to talk about such a concept that I have overlooked. It is the theory behind what I am attempting to do, when I approach one specific market that I have built a bias from my edge ....

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



Once again, here is the link to the RSS feed to blip.tv's version of the playlist.

So again ... at first, when I think the trend begins off of my implied probability? I will dance for it for a couple of trades.

The real money begins when the trend proves correct, and I continue to do what I often discuss: massage that bias.

* * *

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 14 years of experience in trading and investing in these markets. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research, and tolerance for risk.

Thursday, October 7, 2010

Trading Psychology and Emotional Discipline (Series): Airelon's Personal Junk on the Blog (VIDEO)

"If ignorant both of your enemy and yourself, you are certain to be in peril." - Sun Tzu, The Art of War

To continue in the endeavor of 'tweeking' my playlist videos, I wanted to address a topic, or question that comes up from time to time on this blog ...

Why does Dan include this "personal junk" of his?

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



In many industries, when you lose your cool? You have to apologize to a co-worker. Or perhaps just deal with underlying tension.

In this industry, when you lose your cool? You lose money.

This video will appear in the playlist regarding "Trading Psychology and Emotional Discipline". The link to the blip.tv RSS feed of this playlist can be found by clicking here.

Don't forget, if you wish, you can review this blog here. I am always willing to listen to counsel and kind critiques on ways to improve.

* * *

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 14 years of experience in trading and investing in these markets. The Challenge accounts are run for the education of other traders who should make their own decisions based off their own research, and tolerance for risk.

Wednesday, October 6, 2010

A Weekend Away in Northern Pennsylvania

"For what does a man come to have for all his hard work and for the striving of his heart with which he is working hard under the sun? ... With a man there is nothing better [than] that he should eat and indeed drink and cause his soul to see good because of his hard work. This too I have seen, even I, that this is from the hand of the [true] God" - Ecclesiastes 2:22, 24

(The photos in this entry were taken by a personal friend ... my buddy Tim's wife, Rana, who is incidentally my wife's best friend from childhood. All of the pictures below can be enlarged with a simple click.)

I've spoken for a few weeks about buying a video recorder, and producing some videos that allow my subscribers to see "a day in the life of a trader". I don't live for trading. I trade so I can live. While I am working at bringing such a project to this blog ... (I expect you may see the first video around the end of November, or the beginning of December) ... I thought I would get started a little sooner than that, by sharing some pictures of life ... beyond the desk at which I invest and trade and record the videos that you've all come to know.

As I have already mentioned, I spent last weekend at a family cottage in Pennsylvania. A beautiful place on about 7 acres of land, and one that borders the Allegheny River. We have seven jobs when we go to 'the cottage' each and every year.

Eat a lot of great meat. Drink some beer. Talk. Stay up late talking. Sleep in. Eat more meat.

Rinse.

Repeat.

One of the couples that is very dear to us, and have accompanied us each and every year since they were married were not able to go with us this year, as they had just recently arrived home from Hawaii. But somehow, someway, we were able to drink beer, eat meat, and stay up late without them (Sorry Mike and Misty, but the meat-fest-palooza this year was especially great, although we did not attempt last years record of a 'meat only, non-vegetable diet).

We arrived Thursday night at the cottage, and the first task, is basically ... to unwind ... relax, and talk. So that night, I think we stayed up that first night to about 3:30, just talking.

I'm of the firm and abiding belief that from time to time, you need to do things that have absolutely nothing to do with technology. Technology has it's place. But you need to get outside, and do activities from time to time. In fact, I appreciate that at our congregation, we've received counsel to shut off the laptop from time to time, leave the ipod at home, and just 'be'. Be someplace where you can't connect to the internet. Where you have no idea what's going on in the outside world and just play, as humans have done for eons. This is why I brought my small game bow.

Needless to say, we slept in, probably to about 10:30 the next morning. After eating more than enough bacon, I was ready to face the day. My buddy Aaron was with us, and knowing that he loves to bow hunt, I had mentioned to Aaron the night before that I had brought my small game, 62# bow with me for some target practice fun.

Now Aaron and I have both shot. Extensively. Aaron has bagged bear with in Northern Canada with his bow ... so ... yeah, as a hunter, Aaron is light-years ahead of me. I was still digesting my bacon, but I knew that it wouldn't be long before he had the same thought I had. Let's get out and shoot some arrows. For the archers among us, I prefer a traditional bow. No sights. No string clamps. No arm guards. Just a string, the bow, and the arrows. Shooting thus, hones skill. Which is exactly what we did out in the front yard for a few hours.

Now it didn't take long before others that accompanied us were intrigued by watching Aaron and I attempt to plug a small target 40 yards away. So one by one, they began to come out of the cottage, and watch.

Thus, shortly thereafter, we were both demonstrating proper form, and the basics of shooting, especially with my Aarons wife, my buddy Tim and Tim's wife; who is the my wife's best friend from childhood. Stance, arrow placement, draw, anchor points, aiming and release. I had actually forgotten just how much fun shooting a small traditional bow can be, as it's been a few years since I've pulled this particular bow out.

Unfortunately, as you can see, we were shooting at a small target placed on the grass on the front 'yard', from 35 to 40 yards away. Aaron and I were doing well enough at plugging the target. But if we missed at all, we quickly discovered that the arrows would bury themselves in thick grasses and moss in the front yard; making them all but impossible to find (you would figure that two hunters would have thought of the difficulty that can come about from trying to find arrows that have missed their target in thick ground cover ... but hey ... ).

So after we lost the first three arrows, we moved the entire setup to the backyard for another hour or two.

In moving to the backyard, we could place the target against the bank leading up to the cottage, and had our fun back there for some time. Any arrows overshot simply embedded themselves in the bank, which made them much easier to locate.

It wasn't long before we had backed up much farther from the target than what you see in these pictures, and we were attempting 60 to 65 yard shots. I was pleased with myself that I plugged the target both times with a "money shot", but Aaron got the "eating dinner" shot, with a plug right into the center of the target from about 65 yards.

But it wasn't just about target practice with a small bow. The small village that this cottage stands within (Actually, to be precise, the family has two cottages) is simply ... beautiful. Nestled in the Allegheny National forest, there is more than enough hiking to keep one busy for days, while remaining ... "unplugged".

This entire village has an overlook, which is where we began to trek through the woods.

Nothing overly strenuous. But looking out across creation brings it's own rewards. From this overlook, we drove on to a little place called "Hearts content".

Though there are many places to hike in northwestern Pennsylvania, Hearts content has to be one of my favorites (Actually, my wife and I almost inadvertedly spent the night in the woods at Hearts Content, but that's a story for another blog entry).

Hearts Content is one of those places I could (and have) walk around for just hours and hours. Last time I was there, we ran across some porcupine. There is black bear. And during this particular trek, we found what we believe was wild pig sign and tracks. The pine there is incredibly tall, and just leaves you speechless.

After we hiked through Hearts Content for a few hours, admiring the pine trees, it was back to the cottage.

For what you ask? More meat of course!!

And one of the most beautiful things about this family cottage, is that it's back yard rests on the bank of the Allegheny River. Add a swing to the mix, and it's the perfect place to sit, and relax ... and enjoy some quiet.

Before going back inside ... and eating more meat.

So yeah ... that was my weekend. Just a whole lot of the above, as well as some great, meaningful conversations with some people that truly matter to me in my life.

And I really think that it was well needed. Between blogging, video entries, being sick, investing, trading, my volunteer efforts in the community through my congregation, congregation responsibilities, writing "Airelon's Market Tactics", construction projects, and looking ahead to what is going to be an even more busy fall and winter ... I needed to 'recharge the batteries'.

Thanks to Rana again for the great pictures.

For the investors and traders among us? You need to learn to unplug. This is a very demanding business. The success that I've enjoyed and shared over the last few years came with the distinct understanding that from time to time: I had to 'rest up a bit', outside of the sphere of investing and trading.

And for my friends who accompany us to the Cottage each year ... remember this:

Simply because we'll soon be living in Mexico much of the year in 2011 ... does not mean that we won't be visiting, and returning each year to the Cottage, and that lazy river swing ...




Tuesday, October 5, 2010

An Annoucement: The End of "Airelons Market Tactics" (VIDEO)

"Beginnings are usually scary and endings are usually sad, but it’s the middle that counts." - Sandra Bullock

On November 9th, 2010, I will be bringing an end to "Airelon's Market Tactics" as my published newsletter ...

(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 14 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, October 4, 2010

Monday Challenge Project Summary: October 4th, 2010 (VIDEO)

Previous $500 Challenge Project Balances:

"The Three Sisters":

Investing "Sister" Balance: $918.69
Trading "Sister" Balance: $2,069.63
Side-pocket Savings "Sister" Balance: $525.30

Total Challenge Project Funds: $3,513.62


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 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. We split up Rule No. 2, into weekly segments; or $25.00 a week. As I mentioned on August 10th, I am in the processing of liquidating my own personal accounts, and will soon be trading this 'Challenge Project', full time.

For this week, the $25.00 weekly deposit is being transferred to the Challenge Project TRADING Account.

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



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

Challenge Project Balances After Rule No. 2 Deposit:

Goals for Each Account By the Time I Trade Challenge Project Full Time
  • Investing Account: More cash, will evaluate
  • Trading Account: $2,400.00
  • Savings Side-Pocket Account: $800.30
Investing Account Balance: $922.55
(YTD the account is +15.44% YTD Return is about +7.388% Continuing Yield is approximately +6.96% in cash dividends and additional shares of stock)
  • 6.2685 shares of KO (DRIP is on for 4.2685 shares)
  • 5.158 shares of JNJ (DRIP is on for 3.158 shares)
  • Cash: $233.45
-$ 1.00 of this cash I reserve for 'maneuvering' capital
-$ 6.88 of this cash I reserve to D.C.A. KO

-$17.00 of this cash I reserve to D.C.A. JNJ
-This leaves $208.57 cash available for a new purchase
  • Additional $131.00 available from slush fund, up to $1,053.55
Investing Account Balance Since Inception
(Can be Enlarged):


Stock / Futures Trading Balance: $2,094.63
( YTD cash contributions, equity and return up about 31.23 % )
  • 2% risk tolerance gives us $41.89 'at risk' levels
  • 3% risk tolerance gives us $62.83 'at risk' levels
  • Additional $131.00 available from drawdown / slush fund, to $2,225.63
Trading Account Balance Since Inception:
(Can Be Enlarged)

Savings Side-Pocket Balance: $525.30
(YTD cash equity up about 162.3 % Return on Capital is 0 %)
  • $131.00 for a Slush fund / Drawdown Kill Switch fund
  • $263.30 for a Base Savings
  • $131.00 for Emergency Savings
Savings Side-Pocket Account Balance Since Inception:
(Can Be Enlarged)


Total $500 Challenge Project Balance: $3,542.48

* * *

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 14 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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