Worldwide cuts in the Rate were supposed to save us from our second crisis of the year. The mortgage crisis was the cause of the lending crisis, but nonetheless, this is what REALLY shook up the American problems into something that went worldwide. A global initiative cut rates by 50 basis points in about 8 countries, but remember, this isn't to encourage consumers to spend. It is really to encourage banks to borrow and provide lending liquidity. Inflation is still around and we are deeply in a recession.
This, folks, is the dreaded stagflation.
It DOES matter that the vast majority of American's won't realize whats going on. But who cares right? If you don't understand it now, your children will explain this entire crisis starting from the 1980's through now to you when they take ECON and HIST courses in the future.
In the meantime, we(average Joe's) will all whine and moan about our shriveling nest eggs saying "This is ridiculous." just about every other line in our highly intellectual and researched soliloquies on the current state of the economy.
Wednesday, October 8, 2008
Tuesday, October 7, 2008
What a terrible trade today
Positions traded:
GGC
Short 1500 shares @ 2.82, cover at 2.90
$-112.76
$6340.43
I came into the day knowing I made a shitload last week and that after a huge Monday drop the markets would be very testy. Sure enough the FED responded by writing a plan to buy up short term debt and offering rate cuts. Honestly, rate cuts a while back might have helped the credit freeze we are in. How else were the markets to remain liquid with so many failures?
So... what did I trade. I played GGC today.GGC was a huge supernova. It went from 2.12 to 3.25 almost uninterrupted. I wanted a piece of this easy money so badly. Of course, with easy money in a stock like this comes lots of manipulation. A stock that moves like this on 0 news has shady traders involved. Slotmonkey in the chat room was talking about his position and then gave an "OK" to short. I foolishly listened. After missing the short above 3, I chased down to the 2.80's. I got a fill at 2.82 and it didn't even come back near it for the rest of the time I was in. It was between 2.84 and 2.88 for a good bit then it hit 2.90. The chart looked like it could rally off the dip and I didn't see this action to be squeezing so I made my exit for a loss. My exit was not a problem. The fact that I entered this trade was.
Really, the potential for a trading day should not be measured by the number of DAY TRADES I HAVE!!!! This is something I need to fix. Also, I need to stop watching Net Liq on my trades. I forbid myself from doing either of these from now on.
today was horrible. DJI was not moving with the penny financials and I really just rushed this entry.
On the economy as a whole, I can't call it, I can only react. Shorting bans are to expire soon. The FED & SEC will make their decisions and I, as an unofficial daytrader, will have to comply and react. I do want to make it clear while Wall Street was unregulated in this crisis, no one has the guts to blame the Americans who bought mortgages they knew they couldn't afford. Should not they be regulated as well? Just something to think about all of you that are throwing the blame around out there.
GGC
Short 1500 shares @ 2.82, cover at 2.90
$-112.76
$6340.43
I came into the day knowing I made a shitload last week and that after a huge Monday drop the markets would be very testy. Sure enough the FED responded by writing a plan to buy up short term debt and offering rate cuts. Honestly, rate cuts a while back might have helped the credit freeze we are in. How else were the markets to remain liquid with so many failures?
So... what did I trade. I played GGC today.GGC was a huge supernova. It went from 2.12 to 3.25 almost uninterrupted. I wanted a piece of this easy money so badly. Of course, with easy money in a stock like this comes lots of manipulation. A stock that moves like this on 0 news has shady traders involved. Slotmonkey in the chat room was talking about his position and then gave an "OK" to short. I foolishly listened. After missing the short above 3, I chased down to the 2.80's. I got a fill at 2.82 and it didn't even come back near it for the rest of the time I was in. It was between 2.84 and 2.88 for a good bit then it hit 2.90. The chart looked like it could rally off the dip and I didn't see this action to be squeezing so I made my exit for a loss. My exit was not a problem. The fact that I entered this trade was.
Really, the potential for a trading day should not be measured by the number of DAY TRADES I HAVE!!!! This is something I need to fix. Also, I need to stop watching Net Liq on my trades. I forbid myself from doing either of these from now on.
today was horrible. DJI was not moving with the penny financials and I really just rushed this entry.
On the economy as a whole, I can't call it, I can only react. Shorting bans are to expire soon. The FED & SEC will make their decisions and I, as an unofficial daytrader, will have to comply and react. I do want to make it clear while Wall Street was unregulated in this crisis, no one has the guts to blame the Americans who bought mortgages they knew they couldn't afford. Should not they be regulated as well? Just something to think about all of you that are throwing the blame around out there.
Saturday, October 4, 2008
Saturday Notes
Interesting read on BeatTheMkt's Covester account.
If someone is going to teach you to trade, or you are going to invest in their fund, they should know the answers to these questions.
1) What is the accuracy of profitable trades for the system?
2) What is the average profit per trade for the system?
3) What is the average loss per trade for the system?
4) What is the average, largest drawdown in a win or loss?
5) What is the most consecutive wins and losses?
6) Can two people interpet the methods differently?
I've read a lot about hedge funds, and I have never heard of this being discussed. Granted I don't have a few million to throw into a fund, and these are all serious investor related questions, with hedge funds collapsing like Amy Winehouse after every overdosed stage performace, these are important statistics!
I've had huge gains since I started trading about one month ago. I need to digest it and not become one of the 90% of traders that lose money. When I spoke with one of my serious trading partners, Ben, yesterday he advised that I sit out of trading to digest my gains. My gains recently have been very very large in terms of percentages and getting cocky in these markets... well... you can easily be humbled. For my niche, there's an extent of luck in each trade. Its very volatile, its dangerous. You stand to lose it all. Being up 32%, is a big deal. I'm more cautious about losing gains than principal, so you can bet this little hobby of mine has become that much more serious.
This summer, I used to read all of Timothy Sykes's testimonials and just imagine the numbers and figures he'd throw around. People would make $200,$500, $1000 plus everyday. It's hard to digest that I've become one of those people.
COVESTOR NOTES
I just wanted to clarify some notes on my covestor account. The covestor account shows %returns from an initial account valued at $4736.99. The returns, therefore, are skewed. My actual starting account size is $4900.
If someone is going to teach you to trade, or you are going to invest in their fund, they should know the answers to these questions.
1) What is the accuracy of profitable trades for the system?
2) What is the average profit per trade for the system?
3) What is the average loss per trade for the system?
4) What is the average, largest drawdown in a win or loss?
5) What is the most consecutive wins and losses?
6) Can two people interpet the methods differently?
I've read a lot about hedge funds, and I have never heard of this being discussed. Granted I don't have a few million to throw into a fund, and these are all serious investor related questions, with hedge funds collapsing like Amy Winehouse after every overdosed stage performace, these are important statistics!
I've had huge gains since I started trading about one month ago. I need to digest it and not become one of the 90% of traders that lose money. When I spoke with one of my serious trading partners, Ben, yesterday he advised that I sit out of trading to digest my gains. My gains recently have been very very large in terms of percentages and getting cocky in these markets... well... you can easily be humbled. For my niche, there's an extent of luck in each trade. Its very volatile, its dangerous. You stand to lose it all. Being up 32%, is a big deal. I'm more cautious about losing gains than principal, so you can bet this little hobby of mine has become that much more serious.
This summer, I used to read all of Timothy Sykes's testimonials and just imagine the numbers and figures he'd throw around. People would make $200,$500, $1000 plus everyday. It's hard to digest that I've become one of those people.
COVESTOR NOTES
I just wanted to clarify some notes on my covestor account. The covestor account shows %returns from an initial account valued at $4736.99. The returns, therefore, are skewed. My actual starting account size is $4900.
Friday, October 3, 2008
BKUNA!
Positions traded:
BKUNA
long at 1.02, sell at 1.25
+$350
$6473.11
Awesome trade with BKUNA today. I've been hard on myself when I execute bad trades, so you can bet I'll point out why BKUNA was very well played.
I got out of a morning exam at 9:29 AM this morning. Like Laura told me, waiting until 10:30 before entering a position is a good way to get a feel for how things are moving. Plus, in my opinion, you've got a good bit of chart action that can help you for some technical analysis. Before entering BKUNA, I checked out the VIX(fear index) and DJI. I noticed DJI was ~ to penny financials for the day. When you see this early in the morning. Definitely exploit it for the day. I saw a DJI spike while BKUNA was flat lining at 1.02. despit having a solid run in the first hour of trading, all of the signs were there and the DJI just did a nice angled 10/60 cross. I pulled the the trigger. I was quickly 1500 shares in. I checked out if the GOTS chatters were interested in shorting. Terri quickly pointed out it was on the short ban list. ALL SYSTEMS GO. I was now confident enough to walk away and go pickup my new speaker system. I returned to find the stock where I left it... trying to break resistance at 1.10. The DJI was still channeling upwards so I held. I saw the lagging line(I don't know if everyone calls the 60 day MA line a lagging line, but thats what i'll call it. The 10 day MA is the leading line) reaching a peak and considered exiting. I had a solid $150, but the bailout was just hours away. I held. It fell. I got nervous. I reminded myself of all the signs, and continued. As the bailout grew closer and closer it shot up. I didn't even realize it at the time, but this was a $ stock! It was breaking key price points at a very high rate. I'll need to pay more attention next time. The percentage gains were huge. I finally realized around 1.27 as my account broke $6500 in net liquidity. The fact that I realized this at the time is a good sign in retrospect. I really am learning when to exit! After i exited at 1.25 right before the bailout vote was finalized the stock shot to 1.29 and then fell slowly but surely. I had a great exit!
Size of position was a modest bet, but seeing as all of the good signs were there I easily should have done double my position.
One thing I did not do correctly was place the sell limit at the right price. The LAST was showing 1.27 but i put a sell limit at 1.25 since this was the ASK price and thus lost an easy $30.
This is something to improve upon, though i'm very happy with my trade.
BKUNA
long at 1.02, sell at 1.25
+$350
$6473.11
Awesome trade with BKUNA today. I've been hard on myself when I execute bad trades, so you can bet I'll point out why BKUNA was very well played.
I got out of a morning exam at 9:29 AM this morning. Like Laura told me, waiting until 10:30 before entering a position is a good way to get a feel for how things are moving. Plus, in my opinion, you've got a good bit of chart action that can help you for some technical analysis. Before entering BKUNA, I checked out the VIX(fear index) and DJI. I noticed DJI was ~ to penny financials for the day. When you see this early in the morning. Definitely exploit it for the day. I saw a DJI spike while BKUNA was flat lining at 1.02. despit having a solid run in the first hour of trading, all of the signs were there and the DJI just did a nice angled 10/60 cross. I pulled the the trigger. I was quickly 1500 shares in. I checked out if the GOTS chatters were interested in shorting. Terri quickly pointed out it was on the short ban list. ALL SYSTEMS GO. I was now confident enough to walk away and go pickup my new speaker system. I returned to find the stock where I left it... trying to break resistance at 1.10. The DJI was still channeling upwards so I held. I saw the lagging line(I don't know if everyone calls the 60 day MA line a lagging line, but thats what i'll call it. The 10 day MA is the leading line) reaching a peak and considered exiting. I had a solid $150, but the bailout was just hours away. I held. It fell. I got nervous. I reminded myself of all the signs, and continued. As the bailout grew closer and closer it shot up. I didn't even realize it at the time, but this was a $ stock! It was breaking key price points at a very high rate. I'll need to pay more attention next time. The percentage gains were huge. I finally realized around 1.27 as my account broke $6500 in net liquidity. The fact that I realized this at the time is a good sign in retrospect. I really am learning when to exit! After i exited at 1.25 right before the bailout vote was finalized the stock shot to 1.29 and then fell slowly but surely. I had a great exit!
Size of position was a modest bet, but seeing as all of the good signs were there I easily should have done double my position.
One thing I did not do correctly was place the sell limit at the right price. The LAST was showing 1.27 but i put a sell limit at 1.25 since this was the ASK price and thus lost an easy $30.
This is something to improve upon, though i'm very happy with my trade.
August/September in Review
Yng has a nice habit of posting his monthly stats up and I think it would really help my trading If I could pinpoint costs, bad habits, and highlight good trades. So... I will do my best to recount what the months of August/September were like in terms of trading my account.
August was my breakout month. It wasn't very eventful.
August:
Starting account value: $4900
Ending account value: $4855.61
Total loss: $44.39
Total loss (%): 0.9%
Total commissions paid: $30.03
Total # trades: 2
Total # winning trades: 1
Total # losing trades: 1
Positions held long: 0
Positions held short:2
Largest winning trade: $1
Largest losing trade: $-59.40
Total # trading days: 1
# green days on account: 0
# red days on account: 1
September:
Starting account value: $4855.61
Ending account value: $6147.64
Total gain: $1292.03
Total gain (%): 26.6%
Average daily return: 0.887%
Average daily P/L: $43.07
Total commissions paid: $376.17
YTD commissions paid:$406.20
Largest winning trade: $992.40
Largest losing trade: $-146.88
I hit some lows during September that you don't see in the above statistics. It was tough. At its lowest point I was down nearly $300 to $4629.94. My trades on RAMR and SIL helped bring me well out of the red.
August was my breakout month. It wasn't very eventful.
August:
Starting account value: $4900
Ending account value: $4855.61
Total loss: $44.39
Total loss (%): 0.9%
Total commissions paid: $30.03
Total # trades: 2
Total # winning trades: 1
Total # losing trades: 1
Positions held long: 0
Positions held short:2
Largest winning trade: $1
Largest losing trade: $-59.40
Total # trading days: 1
# green days on account: 0
# red days on account: 1
September:
Starting account value: $4855.61
Ending account value: $6147.64
Total gain: $1292.03
Total gain (%): 26.6%
Average daily return: 0.887%
Average daily P/L: $43.07
Total commissions paid: $376.17
YTD commissions paid:$406.20
Largest winning trade: $992.40
Largest losing trade: $-146.88
I hit some lows during September that you don't see in the above statistics. It was tough. At its lowest point I was down nearly $300 to $4629.94. My trades on RAMR and SIL helped bring me well out of the red.
Wednesday, October 1, 2008
Bloomberg
I don't know why I didn't go earlier to check out the Bloomberg Terminal at Park Library in Carroll. This thing was sweet. I don't see it being of huge use to a pennystocker, like myself, but seeing the big firms that had huge holdings on the stocks i've traded was just the beginning of what this machine has to offer. I was getting a news feed just like ticks on a stockprice on the news page. Tons of gossip, spam, and perhaps a bit of honest truth just flying across the pages while also getting the MOST real-time stock prices I can get at the moment. TOS doesn't have shit on Bloomberg.
Of course, I have no idea how to use the damn thing when I get there. Sitting in front of it and marveling at the fact that I get to use two screens for trading is enough for me. The student librarians didn't even know what it was. So... I got to talking to the 60 year old librarian who knew more than what it was called. I think the lady thought it was funny when I asked her if anyone even used it. According to her, "we have a full class on business journalism." Fantastic! They pay 2k a month so all the kids can gather around 1 terminal and see news scroll across the screen faster than methed up bunnies multiply. In any case, I'm not complaining. I think i've found my on campus trading hub. There are computers, the library is very nicely lit, computers, journalism majors, and a fucking Bloomberg machine. The only thing missing is a live CNBC stream.
If the senate knows whats good for them, and they should after monday, the bailout should be passed on this evening for a $DJI rebound on the 'morry.
Of course, I have no idea how to use the damn thing when I get there. Sitting in front of it and marveling at the fact that I get to use two screens for trading is enough for me. The student librarians didn't even know what it was. So... I got to talking to the 60 year old librarian who knew more than what it was called. I think the lady thought it was funny when I asked her if anyone even used it. According to her, "we have a full class on business journalism." Fantastic! They pay 2k a month so all the kids can gather around 1 terminal and see news scroll across the screen faster than methed up bunnies multiply. In any case, I'm not complaining. I think i've found my on campus trading hub. There are computers, the library is very nicely lit, computers, journalism majors, and a fucking Bloomberg machine. The only thing missing is a live CNBC stream.
If the senate knows whats good for them, and they should after monday, the bailout should be passed on this evening for a $DJI rebound on the 'morry.
No trading today. Maybe not for the rest of the week
I hate politics. Its one of the reasons I never meddled deeply into forex and I vowed not to become too involved with the campaigning thats been going on. Unfortunately, Cameron reads CNN politics like I read the NYT Business page. He alerted me to Mccain's attempt to cancel his debate, and the ugly interview Palin had with Couric, the rest of which is online now. I ended up watching the entire thing and quickly realized just how important it will be for Obama to win this election. I won't rant on Mccain/Palin. In my opinion, they make it way too easy to.
Also, I love my covestor chart for black monday. Btw, shouldn't we come up with a term thats darker than black to describe mondays. Seriously, we've had 2 in the past month, this is getting old.
Last bit. Check out this cool article highlighting the job of specialists in the markets. Specialists have the unpleasant job of being buyers in a bear market, or like monday... a huge sell off. Pretty neat how the internet and information exchange has allowed so many more players to enter the market that sell offs like this can even occur. Think about when there wasn't a live video feed to congressional votings before traders reacted. According to the article we could have seen a 1000+ point drop.
Also, I love my covestor chart for black monday. Btw, shouldn't we come up with a term thats darker than black to describe mondays. Seriously, we've had 2 in the past month, this is getting old.
Last bit. Check out this cool article highlighting the job of specialists in the markets. Specialists have the unpleasant job of being buyers in a bear market, or like monday... a huge sell off. Pretty neat how the internet and information exchange has allowed so many more players to enter the market that sell offs like this can even occur. Think about when there wasn't a live video feed to congressional votings before traders reacted. According to the article we could have seen a 1000+ point drop.
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