Starting Over
It’s a brand new trading year. In some ways that’s a good thing, in others maybe not. The slate has been wiped clean, and regardless of whether you did well or poorly in 2005, it matters no more. A fresh month and a fresh year means starting at square one for me.
I like to start the year out by doing my best to hit singles for a while. Making incremental gains is part of my style anyway, as I trade for a living. However, booking regular gains early in the year helps me to build my confidence and get back into the groove of trading after taking some time off over the holidays. This way, I can grow my account and my confidence. It also lets me build a pad of profits and get in sync with the market before pressing it. Once my confidence is where I want it and things fall into place, then I can get bigger and trade more aggressively.
NO, no…… I said get “in sync” with the market!Hit singles while the year is young. It’s a long year, so get synchronized with the market before stepping out boldly. There’s no reason to start the year off behind!
Start your year off right with a free trial to my stock newsletter – it could be the best trading decision you make in 2006!
Jeff White
President, The Stock Bandit, Inc.
www.TheStockBandit.com
[…] A day trading approach offers greater leverage (for designated day trading margin accounts - $25,000 minimum requirement) in the form of 4-to-1 buying power. Trading larger positions on a day trading basis with such leverage on a shorter timeframe can help offset the returns produced by holding smaller positions for multi-day moves. When I’m day trading, I will set my ‘R’ (% of my equity at risk for each trade) generally at 1%. This just happens to be the level which I’m comfortable with, and may vary from your own preference. I’ll adjust that percentage up or down slightly if I’m trading better or worse than normal, raising it to 1.5% if I am trading exceptionally well and am trading in sync with the market, or reducing it to .5% if I am in the midst of a drawdown. The idea is to have a good starting point and then tweak it slightly to maximize your results (or minimize damage). […]