Losing and failure are not the same thing. No matter the outcome of the trade, I am guaranteed two things: I am paying commission and assuming my head is not up my ass, I learned something about myself, the market, and the relationship between the two. Fortunately, losing is a part of trading. Yes I said fortunately, if everyone won the best could never be rewarded. Failing on the other hand is not necessary. What is the difference between failing and losing? Having less capital because of something I know. FAILURE Are you losing more or failing more? |
Archives of “February 2019” month
rssDon't be the guy on top of "Mount Stupid."
50 Paulo Coelho Quotes
The Importance of Timing the Market
Any investor can find and research the “greatest” stock on the market; one with huge potential but if the general indexes are negative, it will most likely be the wrong time to buy. A stock with accelerating earnings, rising sales, an up-trending chart pattern and a strong industry group may sound excellent to buy on the surface but will mean absolutely nothing if the market is positioned to move in the opposite direction of your expectations. As soon as a stock is purchased, the time comes for an investor to make a decision to hold or to sell. If the position shows a profit, hold as your judgment is correct. If the position shows a loss, cut it quickly and don’t rationalize the situation before the loss doubles in size. Timing will play an important role in determining if you are right or wrong.
Losers must be cut quickly, long before they materialize into enormous financial disasters. The company and underlying stock may not be a loser but rather your timing may be premature to a strong movement, forcing you to sell on a pullback. After a stock is cut from your portfolio, the transaction must be forgotten about and eliminated from your subconscious mind and/or emotional bank. This may sound as if I am contradicting myself from Monday but I am not. I said the transaction must be eliminated from your memory bank but not the actual trade. (more…)
10 Words For Traders-Must Read
1. Call options. If you truly have conviction, buy long dated call options as volatility tend to be under priced for long maturities.
2. Short selling. It is harder to short sell than most think, and almost no one is good at it. One hurdle is the drift, but there are countless more.
3. Romance. You’re clearly better off to marry someone in management than to marry the stock.
4. Dip buying. The successful buys on dips and vice versa, it follows that the unsuccessful do the opposite.
5. Market. Everyone is always bearish on the market, only the super successful dares to be bullish/naive.
6. Story. Human brains are hard wired over thousands of years to build stories around your beliefs/thesis.
7. Flexibility. The super successful are always ready to change their mind/direction. Go from long to short or from short to long.
8. Art. Stock picking is as much art as science and very rarely are the smartest the best at this game.
9. Top-down. Local knowledge remains under appreciated. The top down guys ends up shorting the best companies and vice versa.
10. Management. Always invest with the best in class management, however you are better off with a good end market and bad management than the other way around.
To trade successfully you need dedication, a structured approach and a passion for details and math.
"If the best stocks are not moving up in price, the market is not offering good odds of wins."
20 Things You Must Do
1) Wake up 30 minutes earlier each day. Enjoy the fresh air & avoid the mad rush.
2) After you open your eyes, tell yourself today is going to be another wonderful day.
3) Sit on the bed and feel the ground. Then, think about your future/ long term goal. Tell yourself that today you are going to be one step closer to your dream.
4) Check today’s schedule
5) Have your yummy breakfast
6) Before you leave the house, look into the mirror once more and tell yourself you look awesome (more…)
Unknown Facts
-Over the past five years, poverty ratios have remained extremely high despite rapid GDP growth; 77 per cent of Indians survive on Rs20 or less a day. While the top 10 per cent earn First World annual incomes such as Rs5 crores, the wretched of the earth must make do with Rs7,000 a year.
-An additional 100 million people have been driven into poverty by two decades of “free-market” or neoliberal policies. India’s Human Development Index rank has slipped from 121 in 1991 to 134.
-In the Global Hunger Index of the International Food Policy Research Institute, India ranks 65 (of 88 nations). Pakistan’s rank is 58.
-Despite two decades of rapid GDP growth, India scores worse than its neighbours, barring Bangladesh, and also worse than over 20 Sub-Saharan African countries which have experienced economic collapse, civil war, famine and genocides during the past quarter-century.
-None of the 17 major Indian states surveyed falls in the “low” or “moderate” hunger category. Twelve states fall in the “alarming” category, and one — Madhya Pradesh —in the “extremely alarming” category. Four states — Punjab, Haryana, Kerala and Assam — fall in the “serious” category. On a global scale, India’s best-performing state, Punjab, ranks 34th.
-Food grains availability in India has decreased from 200 kg per person a year at the beginning of the 20th century to under 170 kg. As a result, 33 per cent of Indian adults have a body-mass index (weight in kilogrammes divided by the square of height in metres) less than 18.5. (The normal range is 18.5 to 25. People under 18.5 are malnourished, those above 25 obese.)
-If the Wadhwa Committee’s report is adopted, the number of families treated as Below Poverty Line (BPL) would rise to 200 million, in place of the 105 million estimated by the states and the 92.5 million by another official committee.
The EGoM’s draft is minimalist, reneges on the promise of nutritional security, and perpetuates today’s collapsing PDS which supposedly only targets BPL families. Estimates of their number vary from 28 to 50 per cent of the population. These estimates are based on convoluted methods and are unreliable.
The more reliable National Sample Survey (2004-05) found that only one-half of the poorest households had a BPL card. Worse, many non-poor people use influence to illegally procure a BPL card and corner PDS grain.
Trading Psychology Quotes
Psychology matters more to trading or investing than perhaps any other income-producing activity. Here are some quotable quotes from some well known industry participants highlighting that reality…
Anyone who claims to be intrigued by the “intellectual challenge of the markets” is not a trader. The markets are as intellectually challenging as a fistfight. Ultimately, trading is an exercise in self-mastery and endurance.
Ralph Vince (money management expert)
The key to trading success is emotional discipline. If intelligence were the key, there would be a lot more people making money trading.
Victor Sperandeo (master Wall St trader) (more…)