Trading Habits
#1
Posted 29 October 2003 - 06:22 PM
#2
Posted 29 October 2003 - 08:01 PM
Another technique I've found helpful for a position that is only a slight loser is to write a near-month covered call.
Hi Tech
Writing covered calls is one of the more conservative and most rewarding of trading vehicles in the markets, and really why options were developed to begin with.
In fact, I always find it fascinating that most brokers, financial sites (market letters) - or message boards for that matter - rarely talk about this as a way to generate a consistent income on a longer term holding as it's really hard to beat the consistency and protection one gets from utilizing such a strategy - especially with stocks that have low volatility.
As far as your other items in which you refer to in this post - stock picking is always a challenge whether you're a technician or a fundamentalist.
But the real challenge in all of this is understanding that this is a battle between you and the market. You can be right about the direction of a price move, but either you're timing maybe wrong OR there just isn't enough traders out there that agree with your observations.
And, of course, we all have this inherent need to be right about the things we say and do in life - and why it's so hard to sell something in which was initially to be a successful venture .
So though it's hard to sell a loser when the time comes around to do so, it's also important to remember that if you do sell with a small loss you will be able to come back again at a later date...something of which is hard to do if you have nothing to come back with when another opportunity presents itself later on.
In a word it's called "discipline" and the ability to know that you're only as good as your last trade.
Thanks for sharing your thoughts.
Fib
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“Wise men don't need advice. Fools won't take it” - Benjamin Franklin
"Beware of false knowledge; it is more dangerous than ignorance" - George Bernard Shaw
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#3
Posted 29 October 2003 - 09:09 PM
You know, we all see a deluge of arguments, perceptions and predictions on what the market is going to do every day and yet it's relatively rare for anyone to come out and discuss their personal struggles with what is arguably the most difficult aspect of trading/investing - psychology and discipline. As far as I'm concerned the trading/investing process itself is actually a fairly simple endeavor. What I mean is that it's not complicated. Basically your either long or short and the market either moves in your favor or it doesn't. But as simple as it is- it is not easy. The hard part is mastering the emotions of fear and gread that effect us all. I for one am constantly struggling with not letting a trade develope to it's full potential for fear that I'll give up too much of my profit, and yet risking a portion of your profit is absolutely necessary to maximizeing your profits.
It's refreshing to see that there are realistic serious traders out there that recognize that there is much more to successful trading than just being right or wrong.
#4
Posted 29 October 2003 - 11:04 PM
#5
Posted 29 October 2003 - 11:10 PM
#6
Posted 30 October 2003 - 08:42 AM
#7 Guest_rleslie66_*
Posted 03 November 2003 - 11:54 PM