Jump to content
Sign in to follow this  
Wanderer

Wanderer's Trading Diary

Recommended Posts

All,

 

inspired by Roman's Holiday I'm adding a trading diary here in the Markets and Trading section. I don't think it merits the 'main forum'!

 

What I found about RH's diary is that it gives us a little more about him and the logic underpinning his trades. It helps me decide whether I agree with his trades, in part because his circumstance may or may not overlap with mine.

 

I'm an accidental trader. I've been overseas since 1999. I STR'd too early back in 2002. The big advantage for me though was that it gave me a sum of money to invest. I started off very cautiously, but have gradually increased my trading and the sums involved so that I am using almost all my STR fund. Partly as a result of trading, partly through saving hard whilst I am overseas, my fund is now almost 3 times what it was in 2002. Where this is odd is that it leaves me with a sum that is about 13 times my income from my day job. Since 2002, but particularly since 2005 when I started investing more aggressively, I've earned more from the investing than from the day job. And thus I have become the 'accidental trader'.

 

At some point soon we'll be returning to the UK. We'll probably rent for a while. When we stop renting we'll buy a nice house. At the moment we are lucky enough to be able to buy a nice house cash or a lovely one with a mortgage. Obviously if we could build up the fund more then we'd buy a lovely one cash or a nice one and have money left over to invest.

 

I'm rather in two minds about where we've got to. On the one hand, I'm fantastically grateful that we've got to the situation we are in. On the other hand, I'm increasingly nervous as a result of my success. My day job is a good steady one but, since it is for Government, it won't be earning me megabucks and the upward earning potential is very limited. So I'm in this situation with a very healthy cash pile that I'm keen to preserve, but also keen to expand if I can as I know cash is getting inflated away in no-interest savings account.

 

I've a position with a core of gold bullion. I made a lot of money on gold and silver stocks in the last year but have offloaded most of these but for a few tricky-to-trade high spread stocks I've held onto. In 2009 I lost of a lot of money shorting indices from August on. But I've made quite a bit of that back this last few weeks.

 

My unusual situation means that I do 'sweat it' a bit on trades due to the fact that, in a bad month, I can lose almost a year's post-tax salary. In a good month, the reverse can happen. In many ways I'm more dependent on my trading for my future lifestyle than on my job (although my job pays my day to day needs overseas). In this sense I've become more of a 'full-time' trader than I ever anticipated. And I'm not sure I'm very good at the psychology of it.

 

In the last couple of weeks, with the market's slide, I've done reasonably well in that I offloaded quite a bit of stuff at the right time and largely preserved wealth. I've lost money by buying back in too soon on gold etc. But I've made money through shorting the markets. I've failed to make money by cutting profitable positions before they were 'ripe'. This was partly because I've also burned my fingers by letting positions run too long and then waking up to find a profit has turned to a loss. And of course I've lost money by anticipating a rally (or a further fall) when the reverse happened.

 

More recently the frequency of my trading has picked up. In some ways this has worked for me (I've not been sitting on piles of declining mining shares these last weeks). But in other ways I've made more trades that I've lost money on: quite frequently in the past I'd grimly hold onto losers until they came right or I was eventually stopped out.

 

I'm currently nearly at a 'record high' for my portfolio which is good. And I'm also now mostly in cash. This is quite good - can't lose it. But it also reflects the fact I've lost my nerve somewhat the last week. Having been convinced the S&P would fall, now that it has fallen somewhat I've taken all my profits and am wondering whether to position myself for a rally or for further falls. The latter would make me feel a bit stupid as obviously it would have been better to have let my positions run!

 

If any of this chimes with anyone then do feel free to post along.... I'll be recording trades (for my own discipline) and also my moods and how I battle against them!

 

Wanderer

Share this post


Link to post
Share on other sites

Since you asked anybody to chime up.

 

Likewise find myself sitting with a larger cash position than normal, having an equally good time of late; think the added dilemna this brings is making sure I don't lose it.

 

To that end i'm being very selective and doing the reverse to you, trying not to overtrade, as in the past I feel I made my biggest mistakes by doing just that. Still hold favourite stocks, but find cutting my positions on most has left me wondering about how to preserve value against the GBP.

 

With reagrds to physical, i'm trying to keep it within a broad range of 10-20% of my overall disposable portfolio(exclude property as I really can't move at present). That gives me enough flexibility to resist disposing of any P.M's, whilst adding if ever they get low in relation. Fortunately the adding has been in ascendency.

 

My trading mode is quite positive, but because i'm wary of becoming over confident, it makes me equally wary trading in areas I simply don't understand as yet. This frustrates me somewhat when I read say Bubb's diary and I just don't yet fathom all the trades he does :(

 

Good luck with your trading, just thought i'd pipe up, as in the cash position i'm somewhat similar for the reasons stated.

Share this post


Link to post
Share on other sites
Since you asked anybody to chime up.

 

Likewise find myself sitting with a larger cash position than normal, having an equally good time of late; think the added dilemna this brings is making sure I don't lose it.

 

To that end i'm being very selective and doing the reverse to you, trying not to overtrade, as in the past I feel I made my biggest mistakes by doing just that. Still hold favourite stocks, but find cutting my positions on most has left me wondering about how to preserve value against the GBP.

 

With reagrds to physical, i'm trying to keep it within a broad range of 10-20% of my overall disposable portfolio(exclude property as I really can't move at present). That gives me enough flexibility to resist disposing of any P.M's, whilst adding if ever they get low in relation. Fortunately the adding has been in ascendency.

 

My trading mode is quite positive, but because i'm wary of becoming over confident, it makes me equally wary trading in areas I simply don't understand as yet. This frustrates me somewhat when I read say Bubb's diary and I just don't yet fathom all the trades he does :(

 

Good luck with your trading, just thought i'd pipe up, as in the cash position i'm somewhat similar for the reasons stated.

 

Thanks, Riggerbeautz.

 

Sounds like you are being pretty sensible. One of the reasons I've started this diary is that it might me think carefully about a trade if I'm going to register it on here - and risk not only losing money but looking stupid! I'm hoping the discipline will stop me doing silly trades because I somehow feel I have to do 'something'.

 

A breakdown of my current portfolio to follow [upon edit].

 

Cash 62%

Bullionvault (Gold) 28%

Gold Shares 3.6%

Silver (PHAG ETF) 3%

Comdirect CFD Account 1.8%

Other shares 1.6%

 

This represents a heavily sold off position - with my having trimmed back my holding of gold from c.40% (only to build it back up to 28% more recently) and my holding of silver from 13% and my mining shares from c.13%. I've also sold off big (15%) FTSE shorts (inverse ETF) and sold my CFD account to cash (it held a S&P short worth about 28% of my worth, but held on margin). So I'm sitting high (though not as high as could have been due to this and last week's mistakes) but largely in cash, which is new for me. I'm therefore in a 'clean slate' investment position and wanting to plot ahead well for when I reinvest.

 

 

Wanderer

Share this post


Link to post
Share on other sites
I'm hoping the discipline will stop me doing silly trades because I somehow feel I have to do 'something'.

This is the bane of traders imo, and where the fundamentals tend to lead astray. Fundamentals are great for buy and hold... or a long term strategy... but if you are just looking to trade volatility they tend to make you "do something" and buy too soon. As you suggest, some kind of discipline helps... and I don't just mean a Zen-like detachment here. If you can identify some key factors/ signals that you would need to see before buying... they help in restraining the "will to trade". The main signal I am following at the moment is the dollar. It looks likely to break through 80 convincingly before turning to consolidate. This could make a good entry point in the market of your choice. I half suspect we will see the markets recover and go higher before we see the big one that the bear fundamentalists are looking for. Righto.. where's my Jesse Livermore book.... :)

Share this post


Link to post
Share on other sites
This is the bane of traders imo, and where the fundamentals tend to lead astray. Fundamentals are great for buy and hold... or a long term strategy... but if you are just looking to trade volatility they tend to make you "do something" and buy too soon. As you suggest, some kind of discipline helps... and I don't just mean a Zen-like detachment here. If you can identify some key factors/ signals that you would need to see before buying... they help in restraining the "will to trade". The main signal I am following at the moment is the dollar. It looks likely to break through 80 convincingly before turning to consolidate. This could make a good entry point in the market of your choice. I half suspect we will see the markets recover and go higher before we see the big one that the bear fundamentalists are looking for. Righto.. where's my Jesse Livermore book.... :)

 

The discipline of the waiting game is one of the most difficult things to master when it comes to being an active investor/trader in the markets. The temptation to go early on a trade is always there. I think you have to train your mind to believe that doing nothing and waiting is taking a position.

Share this post


Link to post
Share on other sites

Very helpful. Patience, patience, patience is a virtue.

 

Trading update: I've just doubled my position in silver, but it remains half of what it was a month ago.

 

I aim, in time, to get it back to where it was, but I'm trying to learn patience and so rather than jump in all at once, I'm trying to average back in.

 

Will watch this bounce in today's markets to see how long it lasts and take a view whether it is better to go long with FTSE/S&P trackers or short with inverse trackers. Hopefully a few days time should give us a clear direction.

 

Wanderer

Share this post


Link to post
Share on other sites

Nice thread Wanderer. I will enjoy reading and keeping track.

 

I've just moved back to the UK this week, having been in a similar position as your good self. I move in to a rented flat for 6 months tomorrow - I'm not looking forward to paying rent for the first time in three years :( but at least it will give me time to check out areas to consider buying a family property and wait for a potential turn to recent bounce.

 

I totally sympathise with your comment regarding trading too much - I morphed in to an "accidental day trader" having started actively trading in August 2007. Thankfully I'm up overall but not to any significant extent, relative to my former earnings. I could have made a lot more if I'd been less trigger happy, particularly last year. I was holding stocks such as PAAS and MEOH close to the lows but never had the patience for more than a quick buck. Then again, I have escaped some nightmares also. I get trigger happy on Bullion Vault so the physical portion of my gold holding is good with regard to this weakness. My new job requires me to hold all positions for a minimum of thirty days so my day trading days are over for the moment. I'll be looking to adopt a new style for the medium term holds.

 

Anyhow, I thought it was worth asking what currencies your cash position is demoninated in?

 

Also, I am interested how you have reacted and wil react to making big losses. I will be earning much less in my new job as I'm moving from being a contractor to permanent salaried employee. Previously, when I have been sitting on big unrealised losses, one of the things that kept me comfortable was knowing I could earn any loss back relatively quickly. Now, I am worred about how I will react when a trade goes against me and in a situation you described where the loss is equal to a years's post tax savings. I wont be able to use stop losses either witin the holdng period. How have you coped with this situation previously? I am guessing the previous years profits have always cushioned the blow. I know one of my former colleagues in the US invested $300k in STX at around $20 - it sank all the way to $3 and he held all the way back up to the current price. He must have had a few sleepless nights but he always said the $300k was profit from previous trading so that help to keep him sane. Unfortunately, I don't have the luxury of a huge realised profit to cushion me.

Share this post


Link to post
Share on other sites

Hi Sideshow,

 

Welcome to the thread!

 

The big majority of my cash is in sterling (I'm ultimately UK-based). This is what I'll invest again first as and when I do re-invest it.

 

I've also got smaller dollops of Dollars and Euros. I'd say the ratio of £:$:Euro is about 6:1:1. I'll put the dollars back into Gold at some point (if only because they are in my BV account and I need to take them through gold to get pounds out again). My euro are probably ripe for converting to pounds before long if Greece takes off. I changed some pounds into Euro at £1=euro 1.5, so I'm well up, but down on where I was a month ago on that trade.

[incidentally, I've a friend here who has probably made as much as me in % terms this last 18 months by the simple act of changing all his pounds into dollars at £1=$2.06 and back to £ at £1=$1.40!]

 

Yes, my big losses have usually come after some big gains. One mistake I make is adding (in incrementally larger amounts) to positions that are in profit and thereby rapidly rising my entry point. A good example was Silver Wheaton (SLW) where I added (bigger amounts) to a winning position. This raised my entry price and then, when they took a knock, I was in at a loss. I subsequently held on grimly to these and, ultimately, made my best ever single trade - tripling my holding in one fell swoop at or near last year's bottom (although I subsequently took profits too quickly). Knowing you've made gains does help.

 

I'm learning to sell my losers more swiftly though. I eventually cut a FTSE short I was running last Autumn and then re-bought at a better price some time later and subsequently re-gained much of my loss. But that is the exception. I do TRY to trust my head - i.e. by when you are scared, sell when you are confident - and those trades usually turn out best. When I trust my panic instinct - chasing a rapidly rising stock or selling one that is falling sharply - I usually regret it swiftly. Hence my nervous purchase of silver today.

 

I must confess though, I do sometimes struggle with the scale of money I'm dealing with. I feel I have been given this one-off opportunity to get things right. My faith helps, but I have to keep reminding myself of it.

 

Will add more but am rambling now.

 

Wanderer

Share this post


Link to post
Share on other sites

Always using stops within an trading plan is the best thing I have learned...and a good execution platform.

 

You sleep much better at night

Share this post


Link to post
Share on other sites

G'day, well I added 11% to my bullion holding at BV today, bringing it up to a nice round number. I've got more cash left there and may use it for silver or gold soon. I'm encouraged by the rally from 1080 and would like to 'ride the escalator up' for any rally, perhaps then thinning down once again when I feel things reach a top. I paid with £s as I feel the £ may yet fall further against the dollar. David Cameron's new statement that the Conservatives won't slash spending straight away won't have done anything to help the pound. As one Tory MP once told me: in his view the Conservatives talking fiscal prudence was the only thing keeping the pound afloat - with the ironic result that it helped prop up GB's spending plans and increase the latter's chance of re-election. Not sure I buy that argument 100% but I can see what he is driving at. Pound seems to be trending below the 1.60-1.65 channel it has been in for months. A break out could precipitate a big slide.

Share this post


Link to post
Share on other sites

Gday Wanderer

 

Welcome to the investing section!

 

I havent got much to say except that I originally started out with the intention of being a long term buy and hold type and am seeing what might be the end of the road for that strategy and am therefore thinking about alternative methods but not much action on that from me as yet.

Share this post


Link to post
Share on other sites

Mixed feelings today.

 

Having given up my S&P and FTSE shorts after first getting stopped out a fortnight ago and then reentering and taking profits, I was very disappointed in one sense to see y'days unexpected stock market fall.

 

Particularly gutting was seeing my Copper Short (which I closed at a modest profit) would have made me several month's salary if I'd held onto it. Grrr.

 

I was then torn between jumping in and joining the action or standing by on the basis the worst might have past for the next few days. As it was I jumped back in at about 2/3 of the way down the day's fall and so am already nicely up on an S&P short. My next decision is whether to take profits on that or let it run. I sense volatility is going to be increasing and the trading environment will become more difficult and timing - always difficult if you have a day job - will become tricky.

 

My gold has been clobbered and I obviously regret not hanging fire on jumping back in the other day - ditto silver (big time). On the positive side, I'm still lighter in both (and at a lower entry price) then when I sold right down early december.

 

So a mixed bag - some successes missed but some big losses avoided over the last few months.

Share this post


Link to post
Share on other sites

Yesterday (Friday) was a day of spectacularly bad trading for me and I think it worth recording here so that others can learn from (or simply laugh at) my mistakes and so that, by facing up to them, I don't repeat them. The volatility that has been growing recently is killing me....

 

I started off the day with my nice CFD S&P shorts which then began to go badly wrong when the first leg up of the S&P's 'W' happened. I panicked and sold my Shorts in order to avoid losing money in my leveraged CFD account. When the S&P then did a 180 degree turn I bought back in and was enjoying the ride down throughout the middle of the S&P's day. Time difference meant I went to bed just as the S&P was bottoming. Before tucking down I dabbled with the idea of taking my profits but decided against it.

 

This is a difficult area for me at the moment - when I've taken profits I've generally done it at times when I should have let it run. And when I've let it run....

 

Predictably, when I woke this morning I discovered the S&P had done another handbreak turn and shot back up to put my CFD shorts into a loss.

 

So there you are. Lots of amateurish mistakes. I now need to separate out my trading strategies for my investment account (no leverage) and my trading account (leveraged). I could give the leveraged account up entirely, but I do think it is useful as an academic exercise to try and understand the impact of leverage on one's thinking.

 

Anyway, I'm thinking that I've really got to learn to take profits more readily on my CFD account and let them run more on my normal trading account. If anyone else has thoughts on this and can help me then I'd be most grateful.

 

I need now to try and figure out whether I think yesterday (Friday's) action was just a sharp rally in what was effectively a new bear market, or the return to a bull market. Once I've figured this out in my mind then I think I need to take a short/long position of some size in my investment account and be prepared to duck in and out in the trading account. Establishing that core position in my investment account will make me less unhappy about ducking in and out on the trading account. Now it is just a case of working out which is which in terms of the long term trend that is continuing/been established.

 

One thing I've generally noticed from GEI is that we are often 'early' on trends and so I either have to learn to wait a bit to invest prior to seeing ideas here, or to learn to carry a loss until we are 'right'.

 

(BTW - no pity required - its only a very small CFD account!)

Share this post


Link to post
Share on other sites

Hi W, have you read Lefevre's "Reminiscences of a Stock Operator"? There is a lot of wisdom in those pages dealing with trading/ speculating. I would highly recommend it... Ch 8 on is especially relevant.

Share this post


Link to post
Share on other sites
Yesterday (Friday) was a day of spectacularly bad trading for me and I think it worth recording here so that others can learn from (or simply laugh at) my mistakes and so that, by facing up to them, I don't repeat them. The volatility that has been growing recently is killing me....

 

I started off the day with my nice CFD S&P shorts which then began to go badly wrong when the first leg up of the S&P's 'W' happened. I panicked and sold my Shorts in order to avoid losing money in my leveraged CFD account. When the S&P then did a 180 degree turn I bought back in and was enjoying the ride down throughout the middle of the S&P's day. Time difference meant I went to bed just as the S&P was bottoming. Before tucking down I dabbled with the idea of taking my profits but decided against it.

 

This is a difficult area for me at the moment - when I've taken profits I've generally done it at times when I should have let it run. And when I've let it run....

 

Predictably, when I woke this morning I discovered the S&P had done another handbreak turn and shot back up to put my CFD shorts into a loss.

 

So there you are. Lots of amateurish mistakes. I now need to separate out my trading strategies for my investment account (no leverage) and my trading account (leveraged). I could give the leveraged account up entirely, but I do think it is useful as an academic exercise to try and understand the impact of leverage on one's thinking.

 

When you entered this trade what time period did you put on it? A day trader would have closed it out before the end of the day regardless. Those swing or position trading would have entered it on the basis that the trade would last days, weeks or months. I realise you probably know all this, but I think that when you enter any trade you should know beforehand the time period you are trading and not see it as a mistake if it turns against you within that timeframe. You just get out if the trade has gone wrong. This trade was a mistake if you were day trading, but then just let it run because you changed your mind later. Short term volatilty in markets can mess you up as there are greater rewards to be had over a shorter time period, but also the potential for greater losses. One strategy is when there is volatilty in the market is to just trade the shorter time periods. The other option is to just stay out and wait for the dust to settle as eventually it does.

Share this post


Link to post
Share on other sites

Dear No 6,

 

Please assume nothing about me - ie don't assume I know anything about trading. I've really been making it up as I've gone along the last 7 years. A few big correct decisions have meant it has earned me more than the day job in recent years, but I really know very little.

 

The market is now in a different phase and I sense 'a few big correct decisions' is more difficult to achieve.

 

I like your 'day trader' point: I really should consider only taking positions for my waking hours on my CFD account. Time differences make this difficult (I'm GMT+4) but worth considering.

 

Wanderer

Share this post


Link to post
Share on other sites
Dear No 6,

 

Please assume nothing about me - ie don't assume I know anything about trading. I've really been making it up as I've gone along the last 7 years. A few big correct decisions have meant it has earned me more than the day job in recent years, but I really know very little.

 

The market is now in a different phase and I sense 'a few big correct decisions' is more difficult to achieve.

 

I like your 'day trader' point: I really should consider only taking positions for my waking hours on my CFD account. Time differences make this difficult (I'm GMT+4) but worth considering.

 

Wanderer

 

You seem to imply you consider yourself a novice at what you are trading? Before I begin trading any new concept or way alien to what i'm used to, I dummy trade until feeling comfortable and judging my success as I do.

 

Can I politely ask, did you do this? If not, what is the hurry to trade? Do you find it compulsive akin to gambling? That might seem harsh, but hopefully might make you think why do you feel the need to trade at all? Forgive me if thats not helping.

 

Share this post


Link to post
Share on other sites

Hi Riggerbeautz,

 

Thanks for the questions. Questions I've been asking myself. I am a novice in some senses. But then I consider that a mixed blessing: some of the 'pros', as we know, do some pretty stupid things and are so wrapped up in the system that they can't see its failings. My day job gives me a good overview of what is happening in the world and I can put that to good effect in my investing/trading. The downside, of course, is that no I don't have much trading/investing experience. However I've generally countered for this by investing small sums at first and then gradually expanding. My CFD account is a new departure and amounts to only about 2% of my wealth.

 

What is the hurry to trade? In a way, nothing. Of course I could just sit all cash and wait for Autumn so to speak. But I know that I inflation in the UK is in excess of what I can obtain in a savings account so I want to put my money to better work than that. As it happens, my investment account is, currently, largely cash as I wait for opportunities. With my trading account I've been trying to exploit market volatility with, as you can see above, only limited success - I've actually grown the sum since January (so I'm in profit) but I've made a lot less than I easily could have with a bit more knowledge and discipline.

 

Compulsion? I've wondered that. I've seriously considered it but I don't think that is it. When I don't trade for a week or two I'm not itching to get back to it for any 'rush'. But I am conscious that there are events happening out there that mean I've got to steward my resources carefully. But I'm not closed to the idea it is a compulsion. Hence my recording my trades here in order for their wider inspection and the sort of questions you raise - so keep at it!

 

Immediate question: to let those shorts run or get rid? Is the market going to shoot up on the basis of Friday's rebound or was it another bull trap?

Share this post


Link to post
Share on other sites
Dear No 6,

 

Please assume nothing about me - ie don't assume I know anything about trading. I've really been making it up as I've gone along the last 7 years. A few big correct decisions have meant it has earned me more than the day job in recent years, but I really know very little.

 

The market is now in a different phase and I sense 'a few big correct decisions' is more difficult to achieve.

 

I like your 'day trader' point: I really should consider only taking positions for my waking hours on my CFD account. Time differences make this difficult (I'm GMT+4) but worth considering.

 

Wanderer

 

I suppose the point that I was making is that when you enter trades you must be doing so by getting a buy or sell signal based on the timeframe of the chart? Daytraders would typically use charts from 1 tick through 1 min, 2 mins, 5 mins, but probably no more than the 30 minute charts. A swing trader would take their signal from say 1-2 hour charts, but more likely the 4 hour or daily chart. Longer term traders would probably use the daily and weekly charts. All of these charts would give different signals, depending on your set up, of when to buy and sell, thus before entering any trade you would have some idea of the time period that it covers and how long you are likely to be in it. For instance, you would not take a signal from a five minute chart and expect to keep the trade open for several days, however, you might take the 5 minute signal to enter as a swing trader if the 1-2-4 hour charts gave the all clear. For a daytrader the trade taking a five minute signal might last an hour or two max, unless there is a big, persistant move that carries on in your favour for the rest of the day, which you would then let play out by moving your stops as time went on.

 

From your earlier post it was not clear what the timeframe for your trade might be and I would suggest that if you haven't done so already you may want to work this into your strategy.

 

Below are the 1, 4 hour and daily charts for the S&P and while the overall trend looks down there is enough doubt to keep the bulls alive.

 

One hour chart

ScreenShot070.gif

Four hour chart

ScreenShot069.gif

Daliy chart

ScreenShot068.gif

Share this post


Link to post
Share on other sites

Well, I held on to my shorts and they are looking better now. So I'll hold on a little longer. Perils of the day job now strike though: off to Madagascar today which means difficult to stay in touch, although the wifi at the hotel isn't bad!

 

Sterling is well down against the dollar over the fortnight. I sense we are close to either a sharp further leg down or a good bounce. Don't believe it will find a new 'level' at 1.55. I'll look for evidence of a move and may take a position.

Share this post


Link to post
Share on other sites

Well, lots of mistakes including letting my shorts run. Ho hum.

 

I did add to my gold, silver and silver wheaton (NYSE: SLW) two days ago and have enjoyed a little pop.

 

That said, I'm going through one of my nervous investment phases. If I wasn't worried about a substantial drop in the value of the pound, I'd be tempted to go for cash now until all is clearer.

Share this post


Link to post
Share on other sites
Well, lots of mistakes including letting my shorts run. Ho hum.

 

I did add to my gold, silver and silver wheaton (NYSE: SLW) two days ago and have enjoyed a little pop.

 

That said, I'm going through one of my nervous investment phases. If I wasn't worried about a substantial drop in the value of the pound, I'd be tempted to go for cash now until all is clearer.

 

Why not put a chunk of your reserves into the US dollar if you're worried about the pound? That way if assets do decline, you will be in a position to take advantage to buy when they are cheaper.... as the dollar may be one of the few currencies to hold its value, or even strengthen, at a time of deleveraging.

Share this post


Link to post
Share on other sites

Good luck with this, W.

 

My unusual situation means that I do 'sweat it' a bit on trades due to the fact that, in a bad month, I can lose almost a year's post-tax salary. In a good month, the reverse can happen. In many ways I'm more dependent on my trading for my future lifestyle than on my job (although my job pays my day to day needs overseas). In this sense I've become more of a 'full-time' trader than I ever anticipated. And I'm not sure I'm very good at the psychology of it.

It is probably wise to have a laser focus on "what you can lose", since you can control the amount you have at risk.

 

Cutting the losers (somehow), and letting winners run is good, old advice.

 

Also, I think that 2010 will be a very tough year to make money on the long side.

I am building a position in long-dated, Jan.2011 Calls on SDS (a 2x Bear instrument)

Share this post


Link to post
Share on other sites

Evening all,

 

Been away for a few days. Now up to record levels in Sterling, but largely due to sterling's fall against the dollar and recent bullishness in Silver and Gold.

 

Since last I wrote I've added shares in SLW and RGLD and also upped my quantity of silver. I've also bought in some inverse GBP/USD etfs that have done nicely. I'm now down to about 30% cash, but with most of it still in sterling - bits in Euro and Dollars. Seeing that our house offers didn't come through I'm now considering leaving the sterling building altogether - although am nervous of exiting at a temporary low.

 

Recent gains mean I'm almost tempted to cash in most of my shares and some of my gold, but the question is then 'where to put it'? I can't easily shift money into dollars although I could buy proxies through the sort of ETFs described above. It is difficult for me to access more 'exotic' currencies like Canadian Dollars - but if people can suggest how, glad to learn. I'm also tempted to start re-shorting the indexes, as they look high again, but my previous losses at this game are holding me back...

Share this post


Link to post
Share on other sites
I can't easily shift money into dollars although I could buy proxies through the sort of ETFs described above. It is difficult for me to access more 'exotic' currencies like Canadian Dollars - but if people can suggest how, glad to learn.

 

Barclays have a foreign currency account - must have a std bank account with them first, sign up in store - or HSBC have similar

 

http://www.bank.barclays.co.uk/Currentacco.../P1242557963858

 

There is also an ETF for the Chinese currency

 

I need to give all this a bit more thought/action. Trouble is timing is not the best with Sterling the way it is.

 

 

Share this post


Link to post
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
Sign in to follow this  

×