Investing General Discussion

Blazin · Oct 30, 2021

Gravel said:
If I understand that correctly, it's saying we'll get a continuing bull through next May?

Sounds right from what I'm seeing. But after that we'll likely see a massive fall (assuming the tapering ends soon). We should be getting interest rate increases, inflation, and bear market all at once.

Should be a blast.

when the market is up more than 5% from May to Oct it has always been green (20 of 20) from Oct 27 to May 5 with a pretty awesome avg rate of return

Big Phoenix · Oct 31, 2021

Gravel · Oct 31, 2021

That's an impressive percentile to be in one asset class. I wonder where that real estate is; is it primarily US/Canada/Australia, ghost cities in China, actual real estate they're living in (Chinese middle class?)?

And I don't mean this to brag, but I was pretty shocked when we did our monthly account balances today. Despite writing a massive check for the down payment on our house (just over 20%), our liquid net worth actually went up $2.5k.

Which is good, because I think we're going to need every penny when the economy finally melts down. If we can gain that 10%+ between now and May 2022 that Blazin mentioned, maybe the 40%+ fall will be less painful.

Zzen · Oct 31, 2021

Blazin said:
For the period my average cash utilization is around $500-600k/mo., I occasionally spike that up to $800k. When it does go higher that is usually just for 1-3 days. I'm pretty spot on picking bottoms so I tend to strike pretty hard and then ease off after the easier money is made.

What was your cash utilization when you were pulling those $1K - $2K months at the start of trading full time?

Blazin · Oct 31, 2021

Zzen said:
What was your cash utilization when you were pulling those $1K - $2K months at the start of trading full time?

$50-100k. I started out scalping and adjusted strategies over time what clicked most for me has been selling put options and swing trading. I made some heavier returns early but was highly sporadic had larger % gains and losses, more down months. I have become rather proficient at avoiding draw downs but that does hamper potential returns. I look for about half the beta of the market while capturing 80% of its performance. I perform best in volatile markets, underperform the market the worst during boring melt ups. So years like 2017 and this one tend to be rough. This year working for me points to how the learning process never ends, I looked at mistakes I made in 2017 and my read was that we were going to have a very similar year and was able to use months like March and Oct to perform better than I would have in 2017 (only made 7% in 2017 OUCH waiting for pullbacks that never came).

It has been a challenge to read data well enough to know when to pounce on 3-5% pullbacks vs the more standard 7-10% corrections. Lots goes into building positions that allow me flexibility, I know I achieve it when I'm both rooting for the market to drop and perfectly satisfied when it doesn't.

Part of why this works for me is because I've reached an asset level that I no longer need higher returns, allows me to take the path of least resistance/risk. If my future wasn't financially secured I would take more risk. In my first decade trading I averaged 59.73% return, but I was trading with amounts that could easily be replaced with income. Even for that decade the returns are skewed, because in 2002 I made 260.38%, sounds super exciting but I made $23,660 that year. I was happy to go from $9,087 to start and $32,747 at year end, but had I lost that $10k it would not have had much material impact on me, but probably would have psychologically. I have never topped that year since and I never will, I wasn't a better trader then I was far worse.

In the last decade I have averaged 16.55% so I'm pretty sure I"m losing to the nasdaq, not sure about SPY. I have minimal drawdowns compared to the market during that period and I definitely feel like a much better trader now. In the next 10 yrs my avg return will be even lower, I'd imagine below 12%. I sure hope to continue to learn and adapt but I'll likely apply that learning towards controlled risk rather than trying to make more. I have talked to the wife about once we hit a certain NW threshold taking any money I have over that and simply trade without such regard to risk, and that could probably be a lot of fun for me.

Zzen · Nov 1, 2021

Blazin said:
$50-100k. I started out scalping and adjusted strategies over time what clicked most for me has been selling put options and swing trading. I made some heavier returns early but was highly sporadic had larger % gains and losses, more down months. I have become rather proficient at avoiding draw downs but that does hamper potential returns. I look for about half the beta of the market while capturing 80% of its performance. I perform best in volatile markets, underperform the market the worst during boring melt ups. So years like 2017 and this one tend to be rough. This year working for me points to how the learning process never ends, I looked at mistakes I made in 2017 and my read was that we were going to have a very similar year and was able to use months like March and Oct to perform better than I would have in 2017 (only made 7% in 2017 OUCH waiting for pullbacks that never came).

It has been a challenge to read data well enough to know when to pounce on 3-5% pullbacks vs the more standard 7-10% corrections. Lots goes into building positions that allow me flexibility, I know I achieve it when I'm both rooting for the market to drop and perfectly satisfied when it doesn't.

Part of why this works for me is because I've reached an asset level that I no longer need higher returns, allows me to take the path of least resistance/risk. If my future wasn't financially secured I would take more risk. In my first decade trading I averaged 59.73% return, but I was trading with amounts that could easily be replaced with income. Even for that decade the returns are skewed, because in 2002 I made 260.38%, sounds super exciting but I made $23,660 that year. I was happy to go from $9,087 to start and $32,747 at year end, but had I lost that $10k it would not have had much material impact on me, but probably would have psychologically. I have never topped that year since and I never will, I wasn't a better trader then I was far worse.

In the last decade I have averaged 16.55% so I'm pretty sure I"m losing to the nasdaq, not sure about SPY. I have minimal drawdowns compared to the market during that period and I definitely feel like a much better trader now. In the next 10 yrs my avg return will be even lower, I'd imagine below 12%. I sure hope to continue to learn and adapt but I'll likely apply that learning towards controlled risk rather than trying to make more. I have talked to the wife about once we hit a certain NW threshold taking any money I have over that and simply trade without such regard to risk, and that could probably be a lot of fun for me.

Damn, great stuff. Were there any books you read that helped you optimize your trading strategy? Or was it more of a process of reviewing what worked, and what did not work, to hone your proficiencies?

Hateyou · Nov 1, 2021

MTTR tearing it up again. Good stuff.

Fogel · Nov 1, 2021

Hateyou said:
MTTR tearing it up again. Good stuff.

My 25$ covered calls looking like they're toast, though I don't mind bitching about buying a stock at 19 and selling it for 25 in a month

Shonuff · Nov 1, 2021

$875 on Tesla in 30 minutes, half the trades were short. Trade was 100K.

Big Phoenix · Nov 1, 2021

So much for that stock split.

Shonuff · Nov 1, 2021

closing swing paper trades on:

LYV $2080 profit on basis of 10875
MSGE -633 on 9810 basis

I certainly wish I'd have made the LYV trade for real, but I got distracted and missed it

TJT · Nov 1, 2021

Big Phoenix said:
So much for that stock split.

View attachment 380003

Second stock split anyone?

Big Phoenix · Nov 1, 2021

Shonuff said:
closing swing paper trades on:

LYV $2080 profit on basis of 10875
MSGE -633 on 9810 basis

I certainly wish I'd have made the LYV trade for real, but I got distracted and missed it

Travel/tourism stocks on fire today.

Shonuff · Nov 1, 2021

Big Phoenix said:
Travel/tourism stocks on fire today.

Yup. I thought this would happen come November and Thanksgiving.

wormie · Nov 1, 2021

WYNN continuous to be on the right track. Also DIS is looking decent here to anyone else?

Blazin · Nov 1, 2021

Zzen said:
Damn, great stuff. Were there any books you read that helped you optimize your trading strategy? Or was it more of a process of reviewing what worked, and what did not work, to hone your proficiencies?

Only trading book I have read is "Reminiscences of a Stock Operator" and would recommend it to anyone wanting to understand more about the psychology of trading. Most progress was trial and error.

Shonuff · Nov 1, 2021

Blazin said:
Only trading book I have read is "Reminiscences of a Stock Operator" and would recommend it to anyone wanting to understand more about the psychology of trading. Most progress was trial and error.

The book that Tysin recommended to me "Trading in the Zone" has helped me with consistency tremendously. Its worth its weight in gold...I stopped at the first 100 pages because it addressed my issues. I don't blow up my account in my loser days any more, I rarely lose 500. In April, I'd lose 2k in a loser day. It helped me with my revenge trading and FOMO issues.

My loser days used to be made worse by issues the book told me to avoid. For instance, I didn't realize I suffered from FOMO so much. I was jumping on a stock immediately after it broke resistance or support, rather than to wait to another candle. And I found myself trying to hit home runs and striking out more often. Each trade is separate from the others. You can't sit there and trying to make up for a bad trade, because then you take bigger risks and more bad trades.

Jysin · Nov 1, 2021

Zzen said:
Damn, great stuff. Were there any books you read that helped you optimize your trading strategy? Or was it more of a process of reviewing what worked, and what did not work, to hone your proficiencies?

I've got a couple I have recommended previously to the thread for anyone taking up day or swing trading.

Shonuff found value in these as well, and can likely attest to their signifigance. Trading psychology and recognizing / managing your own emotions is a far greater learning curve vs technical analysis. Do yourself a favor and make this a high priority before you start trading with any significant size.

#1 Trading in the Zone - Mark Douglas (Free from Audible or also on YouTube)
Amazon product ASIN B07BTK516M
#2 Trade Mindfully - Gary Dayton, Psy.D.
Amazon product ASIN B00P52047W
Once you have a grasp on this, you should move on to other technical focused material.

The Art and Science of Technical Analysis - Adam Grimes
The Candlestick Course - Steve Nison

Then some broader perspectives:

Antifragile - Nassim Taleb
Market Wizards - Jack Schwager
Principles - Ray Dalio

Shonuff · Nov 1, 2021

Jysin said:
I've got a couple I have recommended previously to the thread for anyone taking up day or swing trading.

Shonuff found value in these as well, and can likely attest to their signifigance. Trading psychology and recognizing / managing your own emotions is a far greater learning curve vs technical analysis. Do yourself a favor and make this a high priority before you start trading with any significant size.

#1 Trading in the Zone - Mark Douglas (Free from Audible or also on YouTube)
Amazon product ASIN B07BTK516M
#2 Trade Mindfully - Gary Dayton, Psy.D.
Amazon product ASIN B00P52047W
Once you have a grasp on this, you should move on to other technical focused material.

The Art and Science of Technical Analysis - Adam Grimes

The Candlestick Course - Steve Nison

Then some broader perspectives:

Antifragile - Nassim Taleb

Market Wizards - Jack Schwager

Principles - Ray Dalio

I bought all those and some books on TA, but honestly, the first 100 pages of Trading in the Zone hit the spot.

Fogel · Nov 1, 2021

wormie said:
WYNN continuous to be on the right track. Also DIS is looking decent here to anyone else?

Dis has yet to bounce back after hitting 168 like it has in the passed. 172 has been acting as resistance and it's been in a slight downtrend since.

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