StockTickr Trading Journal
May 24, 2006 at 10:35 am
Good money management can mean all the difference in the world when it comes to your trading results.
I’m a big proponent of keeping tabs on trading results periodically so that you can know where to make adjustments in your game plan. It’s common knowledge to back down trading size during poor performance and ramp it up when trading well, but let’s go a step further.
Enter: Expectancy. Recently I did a post about position sizing, but it goes hand in hand with the topic of Expectancy. Simply stated, Expectancy is what you can expect to make (on average) per dollar risked. Mathematically it is calculated with the following equation:
Expectancy = (Winning Probability x Avg. Win) – (Losing Probability x Avg. Loss)
Although this formula isn’t difficult to calculate, there is a simpler way – let technology do it for you! StockTickr Pro offers a “Journal” which not only calculates your Expectancy, but also the factors which go into the equation above. If you’ve ever wondered what your win/loss rate is or what your average winning trade is, the Journal in StockTickr Pro will tell you. A trading tool like this will make it far easier and faster at the end of the week or month when you’re reviewing your trades to see what mistakes and weaknesses need working on so that you can correct them and avoid trading mistakes which are costing you.
The StockTickr Journal also includes some very cool and useful features such as dynamic position sizing and a great summary page where you can measure your progress over time in terms of your risk.
Preparation
May 21, 2006 at 11:55 am
There’s a great post over at Invest2Success Blog about Winning Trader Traits which I wholeheartedly agree with and recommend reading.
I’ve discussed trader preparation before, and to the Winning Trader Traits post I would only further submit that the mental preparation involved in good trading is every bit as important as the physical side of being at the PC and studying results and methodologies.
The idea that “the great ones cultivate a work ethic that is superior to those in the good camp” is particularly true in almost every arena. Consider Michael Jordan or Tiger Woods or Lance Armstrong – three of the most successful athletes of our time. Although they may have had some talent to begin with, their desire to outwork their competition and prepare themselves for success undoubtedly elevated their skills, and almost certainly added the mental edge needed to compete and win on the highest levels.
Trading is the same way – a little talent helps but a lot of hard work and determination will definitely get you to the next level.
Jeff White
President, The Stock Bandit, Inc.
www.TheStockBandit.com
Great Expectations Series – Conclusion
May 18, 2006 at 9:33 am
The Great Expectations Series for traders has been fun to write and I hope you’ve gained something from it. The aim was to take a closer look at several aspects which combine to make up our expectations when it comes to trading. Although “expectations” could be interchangeable with “goals,” there is definitely more to the story! Let’s hit the highlights and wrap this up.
The Chameleon Trader
May 17, 2006 at 10:15 am
(This is Part 6 of the Great Expectations Series for traders. Be sure to read Parts 1-5 in case you missed them!)
In the wild, adaptation is the key to survival. No, I haven’t lived on the plains of the Serengeti or in the Amazon Rainforest, but I do watch Animal Planet and the Discovery Channel! Almost every program showcases a particular species which seems to fit perfectly into its environment, and by now you ought to be seeing where I’m headed with this.
Throughout this series, we’ve reviewed numerous elements which combine to form your expectations, but they’re all worthless if you’re unable to survive out there.
Successful trading requires adaptation. The market is wild, often running on pure emotion and very little logic. There will be times when you can do no wrong, but there will also be times when every trade feels like a struggle. Being willing to change, expecting change, and learning how to change will be the keys to your survival.
Your adaptation will be needed in a few areas: your method, your position sizing, and your personal spending. Let’s take a closer look at each one.
Eyes on the Prize
May 16, 2006 at 10:55 am
(This is Part 5 of the Great Expectations Series for traders. Be sure to read Parts 1-4 from the main Great Expectations Series page!)
What good is having a road map if you aren’t quite sure which direction to travel? Goals are underrated benchmarks which are entirely created by you. They’re the destinations you’ll be traveling toward on your road to profitability, so let’s jump right in and see how to blend them with your trading expectations.
It’s been said that “if you can see it and you can believe it, then you can achieve it.” In my own experience with trading, sports, or any other endeavor, I know this is true. There’s absolutely no substitute for having a target to aim at. While it’s good to keep your nose to the grindstone and have a trading routine, you’ve got to be able to look up and measure your progress. Knowing where you’ve been is only half of the equation…..you absolutely HAVE to know where you’re headed.
Knowing what you’re aiming for
The Other Side of Discipline
May 14, 2006 at 11:24 pm
The “D” Word is for both sides of a trade.
While taking small losses is widely accepted as the way to survive in trading, good discipline will serve you well on the profitable side of a trade too.
TGB is a little stock which just gave us a huge upside pop in spite of it’s low share price. I recently listed this small gold stock in the “Momentum Movers” portion of The Bandit Broadcast stock newsletter with a buy point of $3.50.
CyberTrader Client Summit
May 12, 2006 at 7:34 pm
I just wanted to send a big THANKS to the great folks at CyberTrader for inviting me to participate in the first-ever CyberTrader Client Summit recently. It was a great time of interaction with a handful of other traders as well as a wonderful opportunity to get the full tour of the CyberTrader facility and a behind-the-scenes look at their entire operation. I’ve never seen so many safety nets in place for staffing, data, order routing venues, and so much more. They’ve really thought of everything, and they even test their backup plans regularly!
Simply the fact that CyberTrader was interested in inviting a handful of traders in for feedback reinforces to me that they care about the ongoing improvement of their product and services. I’ve seen this over the past few years in the enhancements they’ve added to the platform, but last week was confirmation of that. Because trading is my job and I’m a CyberTrader client, I was quite delighted to be reminded of just how important client feedback is to them.
