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Van's Journal - 2013


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New thread for my 2013 Journal

 

2011 - 2012: http://www.greenener...showtopic=15452

 

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Age: 35 (dob 1977), male

Location: London, UK

Marital status: Married, no kids just yet

Occupation: Current day job as a technical consultant for a financial software developer

 

Trading style: I would describe myself as a position trader. I deal mainly in trading indices and large/medium cap stocks, and look to capture changes in major trends. I consider myself neither a bull or a bear, but I do consider myself a contrarian and use technical and sentiment analysis to pick my entry points into trades, and use trading rules to determine my exit points.

 

Trading goal: My goal is to be able to consistently make enough money in trading to be able to supplement my income and provide financial security built slowly from the profits of a second income from trading. I will keep my trading sufficiently smalltime that it will not impact my lifestyle or commitments, win or lose. My goal is *not* to become a professional trader who relies on it as my only source of income, as I consider the mental strain to be too much. Everyone must a find trading style and goal that fits their personality, and this is mine. Health and mental wellbeing are far more important than money.

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Just finished reading Jack Schwager's latest book in his Market Wizards series:

 

http://www.amazon.co... market wizards

 

51Ow5S4pOeL._BO2,204,203,200_PIsitb-sticker-arrow-click,TopRight,35,-76_AA278_PIkin4,BottomRight,-64,22_AA300_SH20_OU01_.jpg

 

 

 

Overall, this is a superb entry in this series, and just as compelling a read as "Market Wizards" and "The New Market Wizards" (the 3rd entry "Stock Market Wizards" was rather weak). Like with those two classic, there are plenty of insights and nuggets of wisdom in this volume that will help you to become a better trader if you are prepared to really taken them on board and act on them.

 

Being primarily from the Hedge Fund world, the way many of these traders structure their trades is somewhat more complex than just buying/selling naked long/short positions and puts/calls, so it can be a little more difficult to understand.

 

More importantly, Schwager nowadays has a more rounded view on what makes a truely great money manager, and it is not all just about high returns, but rather risk-adjusted returns. So he pays more attention to downside volatility and drawdowns when selecting the best managers. As a result, the high risk/high return traders have all but disappeared; there is no one comparable to, say, Paul Tudor Jones for outright performance; the world of money management has evolved, and those type of exceptional returns are simply not to be found in this day and age.

 

You get the feeling that the interviews conducted have become somewhat easier for Schwager this time around; back when he was writing the first MW book, many of the traders were somewhat reluctant to disclose their methods, but because of the reputation of MW and TNMW, Schwager now has the pick of literally the best. There are no frustratingly closed-off interviews; everyone interviewed was worth reading. Additionally, Schwager is not afraid to really dig down deeper with longer and more challenging questions; he obviously has been doing this for a long time now and is adept at getting everything he can from his subject.

 

There's no filler at all in this book; you can gleen some valuable traits from each one of the traders interviewed. It's a worthy addition to sit alongside the two exceptional earlier entries in the series.

 

4.5/5

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Been busy today.

 

- Trading around my position on Gold/Silver - took some profits; will add back when indicators are less overbought

- Reshorted FTSE & SPX. Impressive new years' rally, but I don't think it'll be long until the hangover kicks in

- Long VIX index, which has collapsed

- Long positions in MRW.L and SBRY.L - no idea why these are out of favour today while TSCO.L is up, probably just intra-sector rotation

 

 

 

Long Gold

Long Silver

Long N Y Cocoa

Long Sugar

Long MRW.L

Long SBRY.L

Long VIX

 

 

Short SPX

Short FTSE

 

Short Eurodollar/Shrt Sterling/Euribor

 

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Oil and commodities look like they are gearing up for a big move UP:

 

http://postimage.org/image/m532c3g2v/

oil1.png

 

 

http://postimage.org/image/3zupbs5yf/

oil2.png

 

 

Look for a test of $100 overhead resistance, if it can get through then rising oil prices could be one of the big stories of the year, and maybe Bernanke's endless money printing will begin to show through in real painful inflation.

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I agree - the low was back in July 2012 on many commodities

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Oil and commodities look like they are gearing up for a big move UP:

 

http://postimage.org/image/m532c3g2v/

oil1.png

 

 

http://postimage.org/image/3zupbs5yf/

oil2.png

 

 

Look for a test of $100 overhead resistance, if it can get through then rising oil prices could be one of the big stories of the year, and maybe Bernanke's endless money printing will begin to show through in real painful inflation.

 

 

Going to take a look at cotton, i think, thanks to your recent post.

 

Thanks Van.

 

also just sold out of my USDJPY yen trade given extent of overbought. Will look to re-enter on pullback

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An Interview With Author Jack Schwager

 

Motley Fool-Dec 27, 2012

In this video, Motley Fool analyst Brendan Byrnes sits down with author Jack Schwager, to discuss his new book Market Sense and Nonsense: ...

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The Calm before the Storm??

 

I cannot ever remember the markets being THIS calm. The Dow has been flittering around 100 pts or so of its current level for the last two weeks. VIX is at record lows.

 

I feel it in my bones that some higher turbulence is not far ahead. Markets have always punished investors when they are this complacent.

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'Tis quiet here on the site too.

Is something "winding up" to happen ?

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Black Swan :

If his movements were predictable, he would not be a "Black" swan

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  • 2 weeks later...

I wonder how many others of a bearish inclination have stared with incredulous disbelief at the market action of the last few weeks.

:ph34r:

 

In all the time I have been following the markets, I have never seen an upside move as smooth and relentless.

Where is the peak? Frankly it could be anywhere between here at Dow 16,000 before we get topping action.

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  • 4 months later...

LOL

He is one of the most unpopular ever to hold that office, and it did not take long

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  • 2 weeks later...

I haven't looked at the charts in great detail but I would suspect a considerable amount od technical damage is being done to the bull case. Eg FTSE has lost 800 points since its very recent peak. Another couple of bad weeks and we could be officially into bear market territory.

 

What strikes me is the sense of complacency that is around, even in the face of this correction. When I mention "bear market" to my friends and colleagues they think I'm nuts - such unswerving faith in TPTB usually comes just ahead of the fall. It is very reminiscent of the sentiment back in 2007.

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...such unswerving faith in TPTB usually comes just ahead of the fall. It is very reminiscent of the sentiment back in 2007.

 

I agree - everything seemed fine, until the summer, and AIG and Fannie Mae hit, and it began to unravel.

Then Lehman bros. really took apart the confidence, and a full scale panic ensued.

 

Here's an interesting comment:

 

Lamoureux: Fear Will Return To The Markets, And The Gold Rally Will Resume

While gold has traditionally been perceived as a hedge against inflation, Yves believes the rules are about to change. The new driver for gold, he says, will be credit risk. He believes sovereign debt will return as a dominant narrative as markets begin to realize the debt in Japan, the United States, and certain European nations is, in his words, “unresolvable.” Thus, gold will be a hedge against debt default – not inflation.

 

In a February note to clients, he affirmed this view in a succinct fashion, writing, “Gold is absolutely not risk free. It is, however, default free.”

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  • 2 weeks later...
  • 2 weeks later...

Some trading ideas...

 

Precious Metals - the rally is on. Let's see what legs it has.

Yen - I am starting to like the look of this for a long trade. FXY looks like it is building a large base after bottoming in June following a 6 month collapse.

AAPL - Again looks like it is building a base after spending a year flushing out the weak hands, and putting in a handy double bottom at $400. Everyone is wondering how much downside is left, but if the bull market continues, this stock could surprise to the upside and take out the old highs.

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NGUT has been a good way to play the rally in Gold

 

NGUT is a 3x etf on Gold share (it is like 3x the move in GDX)

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  • 3 weeks later...

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