Remember your goal is to trade well, not to trade often.
– Alexander Elder
On October 31, 2009, In Thought of the Day, by ElfLord
On October 30, 2009, In Thought of the Day, by ElfLord
Win or lose, everybody gets what they want out of the market. Some people seem to like to lose, so they win by losing money.
– Ed Seykota, Market Wizards by Jack Schwager
On October 30, 2009, In Good Articles, by ElfLord
WHAT MAKES THE market so undeniably fascinating is that at any moment, the bull’s case is just as compelling as the bear’s. So let’s say we’ve hit the bottom, or at least a bottom worthy of trading from the long side. After all, the averages have rallied strongly since September, and given that perky performance and the examples of history, there are plenty of reasons to believe the market’s next move could be higher.
Which way you trade usually isn’t as important as what you trade. And there are choices galore.
You could buy stock in IBM (IBM), General Electric (GE) or any of the other big stocks that make up the Standard & Poor’s 500, or a mutual fund that will do it for you. You could buy options on the index itself, or an exchange-traded fund holding stocks that make up the index. You can even buy options on exchange-traded funds that hold stocks that make up the index. Can you say overkill?
Having a good investment idea is one thing, putting it into practice is another. Think Sun Tzu: Every battle is won or lost before it is even fought. No matter how good your analysis is, choosing the appropriate instrument relative to your capitalization is a big factor in determining the outcome of the investment battle. So here’s a look at what might be the right instruments for relatively small investors with varying portfolio sizes. (more…)
On October 29, 2009, In Thought of the Day, by ElfLord
What separates the 1% from the other 99% is a lot of hard work. It’s perseverance. You have to love to do it.
– Tom Baldwin
On October 28, 2009, In Thought of the Day, by ElfLord
Being a successful trader also takes courage: the courage to try, the courage to fail, the courage to succeed, and the courage to keep on going when the going gets tough.
– Michael Marcus
On October 28, 2009, In Good Articles, by ElfLord
THE BEST INDICATION that the market hasn’t yet reached a bottom is that a vast number of analysts and pundits are still trying to call one.
Markets are a combination of fear and greed — and bottom fishing is, by definition, the product of greed. After all, those who are intent on buying the absolute bottom aren’t satisfied to profit from a portion of a stock’s upward climb…they want to capture the whole shebang.
But like the watched pot that never boils, the bottom — a long-term, sustainable bottom — will come only when people stop looking for it. It’s kind of like the family car trip. As long as the children keep asking “Are we there yet?” the destination will never be reached.
Let’s assume, for a minute, that we’ve reached bottom and a new bull market has begun. Terrific! As we’ve discussed before, the big money is made on the big moves. You want to buy a stock because it’s going to go up 100%, not 10%. The reason to get back into the market, then, isn’t because the Nasdaq is going to 5000, but because it’s going to 15000…or higher. (more…)
On October 27, 2009, In Thought of the Day, by ElfLord
It is the big swing that makes the big money for you.
– Jesse Livermore