Trading Summary – August
Winners: 26
Average win: $141.64
Losers: 11
Average loss: $104.15
Win percentage: 70.27%
All in all, not a bad month, but would be even better if I just sat on my hands this last week.
Looking back at August mistakes…
- Do not deal with indices directly (QQQQ, SPY). Not enough volatility to make it worthwhile.
- Try to stick to individual stocks. I know I’ve been saying this forever, but I’ll try to stay out of Proshares ETFs unless it’s obviously low-hanging fruit.
- Do not jump into trades on a whim. This is not a game.
- Having a watch list and sticking to it has been working really well. Stuff that I find during the day is a hit or miss, usually. Since I try to not daytrade, and my average holding time is probably about 3 days, preparation in advance is the key.
- If I don’t understand why a stock is behaving a certain way, get out fast. I don’t care much to find out the fundamentals of each particular company in detail, and if a stock is being irrational there may be something brewing that’ll mess up my trade.
- Have more patience.
- Do not over-margin. My biggest trading losses have been from margin calls.
- Do not buy on anonymous blog tips without research. There are a few good blogs where I get ideas, but I used to just blindly trust them without research (yep, idiot).
I must say after reading somewhere that people consider this market to be “the toughest in the last 50 years”, I feel good about having made money at all! 
Have a great weekend, everyone.
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Kat,
That’s an exceptionally high strike rate, very well done.
jog on
duc
Thanks, Duc! I’m pretty happy. Can I keep it up? – is the question. Despite making some careless trades, it worked out alright in the end.
Just have to be more careful and patient in the future. However, I’d have to become wiser, and probably older. Tough choice
Kat,
The errors that you have identified are a pretty good starting point. Simply ensure that you do not commit them in September.
Of course the question you raise, luck or skill, is a very relevant question. I try in my own trading to segregate the two. So one strategy is purely the result of skill 100%
The second, is purely luck, 100%
The second, returns by far the higher % returns.
Go figure.
jog on
duc
Duc,
what do you mean by “purely luck”? You just go with your hunch, or do penny stocks, something else?
And I guess, this must be a much smaller percentage of your overall trading fund (of course?)
I enjoy preparing the notes in advance, because when it works out as I expected it, I feel so much better. Like I’m in control
Getting lucky with stocks, strangely, doesn’t feel as exciting as predicting the outcome. It’s like “well, it’s good for this one time, but what’s next?”
Kat,
That stock movements in the short-term are random. Not a random walk, far from it, but random in the potential trend over say a few months.
I believe charts are a nonsense for the most part, but like many, I enjoy trying to guess what will happen.
The clue should be that I am a big “Taleb” fan.
Control and luck are not mutually exclusive, in fact the solving of that conundrum will reveal exactly how I trade.
jog on
duc