After 8 years of building the largest and most influential online social network on the planet, Mark Zuckerberg, in all his painfully awkward, non blinking, Kermit the frog-esque, super magic geekiness, has decided to go public with Facebook. Facebook's I.P.O (initial public offering) is scheduled for May 18th, 2012.
An exciting day for many bankers, underwriters, privileged investors and other various cream cakes that know someone who knows someone. Funny how a "public" offering can be so private and exclusive.
You can't get a piece of that pie, and neither can I, but I know something I CAN do to make money off of this IPO!…. eventually. Let me explain. Here's the Small Guy's Guide to Getting in on Facebook's IPO.
I got a chance to make a video with one of my in person coaching students, Dean. We've been trading his account for the past week and so far are up about $900. The trade in this video is on AMZN and we made just over $200 on it in about an hour. Dean and I will be trading for this whole next week so I'll try to get some more vids up and maybe have Dean take a few trades by himself as that will be the final step in our time trading. - Shoot-
Here is a 3 part, each an hour long, series that aired on the BBC about a hedge fund manager by the name of Lex Van Dam who sets out to train ordinary people to trade profitably. I found this series particularly interesting because clearly none of them had a clue as to what they were doing, but they all bought and sold stocks as though they did and the results were terrifying, both financially and emotionally. Many great lessons here. Enjoy!
It's morning, a couple of hours after the opening bell. As you shovel room temperature sweet and sour chicken into your mouth while gazing at the charts on your screen you tell yourself you'll shower later. You click frantically through the windows on your monitor to find your P/L screen. When you find it your P/L is -$859 and the list of your positions traded this morning alone would require you to scroll down another full page to see them all. You've been trading all morning and are starting to feel that buzz in your head and tightness in your chest that always makes you get up and get more coffee. You get up and shuffle towards the kitchen in haste. Halfway there it hits you.. you've got an open position in SNDK and it could move against you in the blink of an eye. It's done it before. You can't let that happen so you must turn back around and land in your black pleather, office depot chair once more and go for the mouse.
Overtrading is an epidemic amongst independent traders. Not only have I personally had to deal with it (mostly in the early days of my trading and now I take a couple positions and call it a day like in this video) but have also witnessed other traders, who otherwise were well versed and fit for trading, suffer defeat because of over-trading. I have seen guys want to be pro traders so bad they were blue in the face, but simply couldn't achieve the dream because of over-trading. So why do people continue to overtrade if it clearly adversely effects their chances of becoming successful? I'll tell you.. 2 main reasons:
1. Thrill Trading
2. Posture!
Ok, I admit these two don't sound incredibly intimidating, but I can assure you these are two of the biggest reasons people fail at trading.
Let's start with thrill trading, or trading for thrills. Thrill Trading can easily be defined as trading for trading's sake. Thrill trading does not require that a trader abandon all reason and good sense while trading, just that the trader place getting thrills from trading at the top of the priority list. The problem of thrill trading manifests itself in a trader's selection of and frequency of positions. If a trader is trading for thrills all that is required for him to get into a position is the opportunity for thrills. The problem with this is there is ALWAYS an opportunity for thrills when trading, therefore thrill traders are ALWAYS trading. So… if trading for thrills is a trader's focus, it means that his actions will follow that focus. It's a rule of nature, our actions follow our focus, but the remedy is simple, change the focus. How does one cease to focus on thrills and begin focusing on what's important in trading, which ultimately happens to be your MONEY and not losing it in the name of a stock market induced adrenaline rush? There are a couple of ways.
1. Take a look at your trading results ( Ratio of wins vs losses, Ratio of trades taken within your predetermined rules vs taken outside of your predetermined rules, and P/L ) and decide that you want better trading results MORE than thrills.
2. Blow out your account, lose everything, and become a stinky and stubbly trading maniac who forgets to put on his flip flops when he runs to Wendy's for lunch.
In both of these options you WILL be focused on your money. The only difference is that in one you still have some and in the other you desperately wish you did. So, as a trader, you chose how you want to do it, but you will be focusing on your money either way. It's science.
… and now let's talk about the second main reason people overtrade, posture. You know, demeanor, position.. Yes, I'm talking about the way you are sitting here! Let me explain.
In Malcolm Gladwell's book, The Tipping Point, he tells a story about a study conducted by Gary Wells of the University of Alberta and Richard Petty of the University of Missouri that showed that the state and/or movement of our physical bodies heavily influences our susceptibility to suggestion. In the study, two groups of politically neutral college students listened to the exact same politically charged speech on headphones. They instructed one group to nod their heads in a "yes" motion throughout the speech and the other to shake their heads in a no motion. The results were pretty impressive as most of the students who nodded "Yes" during the speech tended to agree with the speaker while the students who nodded "No" tended to disagree.
As you can see, what we do with our bodies most likely influences the way we think, which clearly effects our actions.
In fact, I'm thinking of doing my own study, but why bother when the results are so predictable? Well, let me ask you what you think would happen in a study where I placed one group of traders in front of a monitor all day and instructed them to put their finger on the mouse button and instructed another group of traders to exercise, watch movies, talk on the phone or just about anything else one would do while lounging around the house while watching the markets here and there and setting alerts for key price points? Which group do you think is going to over-trade? I myself am leaning toward the group sitting in front of the monitors with their fingers on mice.
I think you know where I'm going with this. Get up! Do other things. Find ways to watch the market without plastering your face to the screen. Take your finger off of the mouse button or risk clicking it when it's the worst thing for your trading account.
One of the advantages of being an independent trader is that we can wait as long as we need to for a good position. Most traders don't take advantage of this, and most traders fail.
Overtrading can easily ruin your chances of becoming a consistently profitable trader, but it doesn't have to. It's all up to YOU!
As you can probably tell, there have been some changes here on TradingApples.com. I figured it was time to update the site as I hadn't updated it in a while (try 2 years).
I had to redesign a lot of elements of the site as the update was a pretty huge software update that, unfortunately, was not compatible with a lot of plugins and add ons that I was using. And of course I fell into the "While you're at it.." mentality and started fixing and tweaking a thousand other things along the way.
The end result is that the site is a lot better both functionally and aesthetically, but as a consequence of these mind numbing and very technical updates (I told myself it wouldn't be that hard, damn was I dead wrong) the site had to be down for just a little over a week!
Going into it I presumed it would take me a day tops. Little did I know a week later I would practically know a whole new programming language, PHP. Trading wise things have been going pretty well, as usual. How bout them AAPLs? AAPL ( if you've been watching ) is over $600 at the moment, and to think I was long when it first broke above 400 but then got shaken out as it shortly after moved back below 400! Well, there's always next time.
As of now the forums are open and you can access most of the site. I'm still working on a few things and will be finished in a few days. Pro Course Members - Click the "Home" tab and you will see a link for Pro Course Access, you can access the course from there.If anyone has any suggestions while I'm in "while I'm at it" mode now's the time to request features, changes, or what have you. Happy Trading and I'll have some live trading videos up soon.
Sam Seiden shares some answers to questions recently asked by students covering topics related to supply and demand levels and how to use them in your trading.
Sam Seiden explains how to take care of your trading day in two hours. The key is knowing what the picture of institutional demand and supply looks like on a price chart, understanding the simple rules of the strategy, and having two hours in the morning to execute the analysis and strategy.
Reply
0 Replies
|
46 Views
