tex_phil

I could tell today would be a bad day last night.
Hang Seng Index 21,134.50 -1,075.91 (-4.84%)

skelevirus

does this mean gas will be cheaper

turboawd

i like how the cnbc analysts always find a way to down play any bad news.....

iCharles

1.49 is amazing for the Euro - I have been tracking it almost every day since the beginning of 2007 (for business reasons) and it has not gone higher than 1.61 in that time (unless I missed it). For the last year or so it hovered around 1.30.

I am very happy with the way the Euro has been acting....GBP on the other hand....

v_therussian

I wouldn't bet on that. XB, which is the NYMEX gas future was actually up at the moment that the oil dipped (when I originally posted this thread), so go figure... although, it did dip afterward - still was back to about the same by the time the day was over.

I'm guessing you hedge for an international business or something?

Not sure if the following statement is applicable to your trading style, but smart money is in big moves. If you bought and sold Euro speculatively since it's creation, you'd be seriously in the money if you are able to successfully identify the medium-term (2-6 months in most cases) positions and follow major trends.

turboawd

got any trading tips short term?

v_therussian

Sure! Don't! Short term is never a profitable strategy. You have to identify major moves and stay in for at least a few weeks. Dont get me wrong, I'm sure there are lots of people who are very successful for a time trading short-term, but they never last.

Example: I identified a move in crude oil in Feb 2008, when oil was in the high 60's-low 70's, I said that it was going to 140 and then back down to 70. No time limits, no stops, just a straight unhedged position: buy at market, sell at 140 and sell short at 140, buy back at 70 (after some more research I actually said buy back at 80 - in case anyone's actually checking this ). Unfortunately (for me and only this time, bc I ended up being right), my superiors deemed this "open" (unhedged) trade I was proposing too risky for our portfolio... and I did not become a millionaire from it, like I was supposed to but think about it like this: point value of the oil contract is $1000, which means I stood to make 130k for each contract! And at the moment we had cash to buy a considerable amount. Now, look at this closer: yes, I stood to profit 130k per contract, but that would have to be a position to keep for many months. Oil got to 140 by May that year, but it's journey back to 80 was even more tedious and strained. I actually paper-traded it and I can tell you this much: I got nervous a couple of times even paper-trading something like this. All in all, it would've probably taken about a year and a half to complete this trade and percentage-wise, without calculating losses due to rolling contracts into new months and interest on the money and so on, I'd say, conservatively, this was about 500% gain (largely depending on your margin arrangements). Am I regretting that I sat this one out? Absolutely not - I know that the risk was extremely high, but I digress...

This was most likely the kind of trade that will not present itself so obviously again in our lifetimes. You need to be deep into trading for about 10,000 hours to be able to "see" trades and "know" which ones are bad. And that's if those 10,000 hours were spent productively... anyway, let me cut myself off right here, bc otherwise I may go on and on about this forever

DD_545i

I've had a few occasions where I've looked at a certain stock at a certain time and thought it would make a good investment but decided not to, and then weeks/months/years later it's up by massive amounts (in one case 1000% after 3 years) but I don't try and work out how much I could have made because you never know at what point you would have sold. Take that 1000% 10-bagger one for example. Maybe at the point where I'd reached 50% gain some little bit of bad news (which it obviously rode out in the long term) might have made me want to get out and take my gains. I've often thought if only I'd bought MSFT or CSCO back in 1990ish, but again, how would I have known to stay in until around December 1999. The swings in the stocks during their massive rises were quite severe at the time. It's only with hindsight we can see when was the best time.

The worst real-world example of this is a stock I bought at $5, saw it go up to $10, then I went to New York to the shareholders meeting and a launch party and on that day the CEO was on CNBC. The stock went up to $35 that day. It dropped to $24, I hung in there thinking it was just a bit of profit-taking. By the time I got home and sold it was down to $15. It was only a couple of months after that (May 2000ish) that I emptied my trading account and I've stayed out of the market ever since. Don't like it. Too darn risky. At the time of getting out I thought the market crash was over. I think the Nasdaq had dropped from 5000 down to around 4000. Who knew it was going to half again from there. I slapped myself on the back a few times as it was dropping I can tell ya.

One deal I do beat myself up on is a house I bought in London in 1995. After just 12 months it had risen in price by 50%, and because I was working 100% in Germany I'd spent no time in it at all hardly, so I decided to sell it. I took the 50% profit and thought I'd done nicely out of it. I found out that a year later it had sold for nearly double that, and right now a decade on it's worth about 4 times what I'd originally paid for it. I could have decided to rent it out rather than selling but another bad choice. So many what-ifs in life.

v_therussian

As a rule, you never sell real estate - that's an income-producing investment. You don't speculate with it.
Want proof? Check out the credit crunch

Also, you can't go about thinking about trades you did not take in hindsight - that's a gambler's mentality and will lead to more mistakes than profits, no doubt. In general, the gambler's mentality is that which makes a person happy when they loose everything they have and live to tell the story. If you have even an iota of this mentality, you have to keep it under constant scrutiny to make sure it never takes over your rational thinking (DD, this is probably not directed at you, since I know from our past conversation that you're smarter than that).

When you identify a trade, you should identify your exit points. No matter what happens, don't look back. A successful trade is not one that makes the most money or % - success first and foremost is when you you execute accurately at exactly the levels that you originally planned. Now, if your levels are off, you have to go back to the "drawing board" and figure out a better way to determine them.

iCharles

If it isn't on a pink sheet I won't buy it.