Patience

 

We live in an increasingly disposable world.

I don’t think this is news to anyone, but the prevalence of being quick to toss objects, ideas, and even people aside is escalating. Cell phone contract is up? Toss the old, perfectly functional, yet obsolete one in the trash and get the New One. Remember when your parents worked for the same company for decades? Now five to ten years at one job is considered a stable employee. Relationship woes? The latest stats I could find were for 2011: the marriage rate was 6.8 per 1,000 total population, and the divorce rate was 3.6 per 1,000 total population. Well, that’s not good.

Now granted, phones need to be upgraded at some point to continue to function on our networks. And some people are forced out of their jobs against their will, and they don’t just quit. And yes, it’s wiser to leave a soul-crushing relationshit than stay married just for the 50th anniversary celebration cake. Word is trying to tell me that “relationshit” isn’t a word. Yes, it is.

But those conditions aside, we do tend to become easily impatient as a society. We toss our phones that lose their luster, we toss our jobs that lose their luster, and we toss our partners when they lose their luster. Try driving in Vancouver; it will turn a Benedictine monk into a screaming, foul-mouthed loon. There is a sense of “me first” oozing into our lives.

There was a study I heard about years ago (and I’m probably messing up the details, so bear with me), that traffic engineers undertook. They looked at car accidents at intersections and thought that they could solve the incidents by putting in a short delay between when the light goes red on one side, to green on the other. The delay, they reasoned, would give traffic a few extra seconds to stop completely. It didn’t work. It actually made things worse. People began to realize there was a delay, and incidents of running red lights increased, not decreased. Accidents went up, not down. In theory it made sense, but in reality, the “me first” mentality took over.

So how does this relate to trading?

For starters, trading – profitable trading – is a profession. Anyone can play golf, or play poker. But if you want to be great at golf, or poker, you need to practice. And that practice, takes Time. Time that most people I find, are simply not willing to put in. You need to make it a profession, and treat it as such, not fuck around with it for a half hour after dinner. And if you’re OK trading with mediocre results, and just enjoy trading for fun, then sure, by all means continue. As I’ve talked about before, not everyone trades to make money.  But if you’re frustrated, and not getting the results you want, ask yourself, “What have I done to deserve the results I’m expecting?” Chances are, not enough.

Too often, our feelings of greed, anger and egocentric preoccupation get in the way of our trading. Look at any chat stream, and it’s there, plain as day.  Probably the single biggest tool that goes into a successful trading plan is a mirror. You simply have to know yourself before you can trade.

Burns quoteTrading isn’t easy. Neither is life. You could spend your years looking for short cuts, or you could just role up your sleeves and get to work. Either way, the clock is ticking. Your choice.

 

 

The Year That Was

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2014.

I’m a tad early for a year in review, but honestly, I’m eager to put this one in a box, nail the lid shut, and toss it into a dark, bottomless pit.

The year saw me go through two separate and unrelated surgeries, one of which I wrote about here, in case you missed it.The first was early in the year, and was an elective. I’d had a metal rod, and nuts and bolts in my left leg and thigh for a decade, and it was time to get them out.

The end of November wasn’t much fun either; the woman I loved and adored, unexpectedly put my heart in a blender and hit purée, on her way out the door. This I am still processing, and have a plethora of counselors and therapists working to reassemble me. Apparently I’m officially a mess, it would seem.

2014 has left me with more scars than I went into it with…both on the outside, and the inside.

The year reads more like an Advent Calendar of Awfulness.

And yet there’s hope.

That first surgery was a tempered success: motorcycling is once again pleasurable, and I can now run with a slightly less gimpy gait.

And speaking of motorbikes, I did purchase a new toy, a 2008 Kawasaki ZX-14. I’m thrilled with it, and I’m looking forward to carving my way through many secondaries this Summer. I do love my bikes. I have yet to part with my older Honda; they become like your children after a while.

As for my trading, I continued to improve, as we all should seek to do year over year. Mistakes were fewer (I’m not a machine, after all), and those made could at worst be thought of as minimally damaging. There were some wonderfully profitable trades this year, and as is usually the case, they came from unexpected places. After all, you can’t know how long a trend will run, until it’s over. Come to think of it, that applies to other areas of Life as well, doesn’t it?

I met some engaging, sharp, witty new friends and colleagues in 2014, particularly recently. And on that note, I’ve learned a few basic truths in my 45 years. One of which is, you find out who your friends really are when you’re either broke, or going through a divorce. I was humbled by the outpouring of support I received privately over the past few weeks. It reaffirms one’s faith in humanity.

Also this year, I upgraded to the iPhone6. While it is “just a phone”, I do love it, and I’m reasonably sure it loves me too. Don’t judge.

As an aside, I am currently reading a couple of books, one of which is The Trauma of Everyday Life, by Mark Epstein, MD. A book review will follow in time, but so far, it’s a thoughtful read, especially for anyone going through pain. My thanks to James Altucher for the heads up on this one in a recent podcast.

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14 reasons to trade

 

“Win or lose, everybody gets what they want out of the market. Some people seem to like to lose, so they win by losing money”       -Ed Seykota

I’m a rules-based kinda guy. It’s both a blessing, and a curse. A few years back, I had a trade on that was too large, and when I woke up and watched the market open, it had started to seriously teeter in the wrong direction. D’oh! In one of those perverse moments of either self-flagellation or camel-like stubbornness, instead of closing the trade, I went for a long walk on our city’s seawall. I think I had a cookie, too.

My computer may have been closed, but the market certainly wasn’t. Three hours later, things had gone from crummy to crummier. I closed the position. Why hadn’t I closed it earlier? And for that matter, why had I even let a trade like that happen in the first place? That would be a longer post, or require a couch and mild hypnosis to fully answer. The short answer probably is a temporary combination of #4 and #6.

You would think the only reason to trade would be to make money. You would be wrong. Here are some of the more prevalent reasons traders hit the buy and sell buttons:

  1. For the adrenaline rush
  2. Out of boredom
  3. To feed a gambling addiction
  4. To punish themselves
  5. To punish others
  6. To feed an ego
  7. To feel better about themselves
  8. To feel worse about themselves
  9. Out of loneliness
  10. Out of greed
  11. Out of fear
  12. To numb pain
  13. To feel pain
  14. And finally, the few that remain, trade to be profitable.

Something to keep in mind the next time you either ask for someone’s advice, or they offer it to you unsolicited.

Last Summer I got into a bit of a twitter-scuffle with someone because I had mentioned that the only reason I trade was to make money. I summarily received a lecture on why that was a pitifully shallow reason. My clarifications that making money is most certainly not my sole reason to rise in the morning, just my sole reason to enter a trade – and that trading is a small part of my life – fell unheard.

As I said, people trade for lots of reasons.

Why are you trading? Drop me a line at tradervancouver@gmail.com

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Don’t wear someone else’s pants

 

Don’t wear someone else’s pants. It won’t end well.

You’re walking down the street, minding your own business, when you see them. Bright purple leather pants. You’ve been looking for a pair like this forever. Not exactly like this, maybe – just pants that would make you a rock god among mere mortals; pants that would command attention and admiration. These are the pants you seek.

There’s only one problem. Someone else is wearing them. But they’re not just “wearing” them, they’re rocking them. There’s an air of confidence, and a sense of purpose that seems to emanate from the pants. These pants mean business.

So you do what anyone would do in that situation – you stop the purple pant wearer.

“Those are amazing pants,” you blurt out.

“Uh, thanks,” replies the purple pant wearer, with a suspiciously geographically vague accent.

“Are they comfortable?” you press.

“Yeah, absolutely. I love ‘em, aren’t they fetch? Actually, they’re probably what got me into the sold-out Stones concert last month. Oh, and get this – at the concert, a director with United Artists came up to me. She thinks she may have a role for me in the upcoming Leaving Las Vegas sequel!”

“That’s amazing!”

“I know, right?” purple pant wearer says. “But get this – I met the love of my life, a model, when I wore these pants to a fundraiser for F.E.N.N.E.L.*

You want to be noticed, you want to be successful, you want to meet the guy/girl of your dreams…must. have. these. pants.

After further pestering, you somehow manage to convince this stranger to sell you the pants, right there on the spot. They rightfully think you’re somewhat crazy, but you threw money at them, and were very persistent. You gleefully race away, pants in hand, eager to change. Purple pant wearer walks away pantless and baffled, but with a fistful of your money.

You try the pants on at home, but there’s just one problem.

They don’t fit.

 

That’s because they aren’t the right pants for you.

And it’s the same thing with trading plans.

There are no shortage of subscription services out there, offering courses or programs that will show you how to trade. Some of these services are less than reputable, but there are those that are taught by real, successful traders. Some are day traders, some are swing traders. They have a system and a plan that they have painstakingly developed after countless hours. It works wonderfully for them.

The problem is, it probably won’t work for someone else. And that has nothing to do with the material, or how it was conveyed. Like the pants, it’s a process that they developed for themselves, and therefore it fits them, not you.

Developing a plan is hard work. It takes a ridiculous amount of time. And worse, there’s no one right answer. But in the end, the only plan you’re going to have any confidence following is the one you’ve built yourself, from scratch. Because it’s built by you, for you…and you alone.

Stumped on an aspect of your plan? Reach out to other traders, ask questions, and read…a lot.

Remember, you can either trade with a plan, or plan on giving your money to those that do. It’s your choice.

 

 (disclaimer: I am not a purple pant wearer.)

* F.E.N.N.E.L. Folks Encouraging New Nations to Endorse Lachanophobia**

** Lachanophobia: fear of vegetables.

Real fear, fake cause. But donations still gratefully accepted. Fight the Man!

victoria-beckham-david-beckham

Matching leather pants. Rarely a good idea…unless you’re David and Victoria Beckham.

 

 

 

 

Capitalism and Sesame Street

 

A few years ago, Sesame Street “adjusted” Cookie Monster’s message in an effort to address rampant childhood obesity. The premise was that too much of a good thing makes it, well, no longer a good thing. Apparently, the nation needed to be told that eating cookies every day is a bad idea.

 

Capitalism is a good thing.

Sure, it’s not perfect, but it’s arguably the best working model of an economic system that’s out there. But much like taking a cookie diet too far, taking Capitalism too far has it’s own set of disadvantages. I posted this clip a while back; for those that haven’t seen it, it’s worth a watch.

Trade Updates

 

I went through a “lazy posting” period from June of this year, to around September. I fell off the wagon and neglected to post a number of entries, as Life had other priorities. It’s too bad really – not only from a public accountability standpoint, but also from a personal routine habit, as well.

Fortunately, I didn’t fall completely off the wagon – I still kept detailed records of each trade I made on a spreadsheet, which is a habit I don’t think I’ll ever drop. In fact, I’m required to make those entries as it’s the only way I have of knowing when to raise my stops, add to trades, etc. Without that spreadsheet, I’d be a rudderless ship.

Many of the trades I put on in those ‘missing months’ have now been stopped out anyway, as you can see here. The first few weeks of October saw the closure of a number of positions, but several still remain. I’m loathe to be “one of those guys” that posts trade updates without having clearly posted the original entries. In an effort to get back on track, and as I have no idea how long these trades could continue to run, I figure it’s better a little late than never. This is the internet, so I completely understand any skepticism, which is why I’ll leave out my original entry price and date, and just post my stop updates.

Hopefully my past diligently posted trades carry some forgiveness weight, and some credibility.

Anyway.

$AVNR

Raising my stop here from a close under $9 to a hard stop of $10.61, and adding to the trade. The chart says all you need to know. An easy to see case of ‘ride the trend, until it stops’…AND have the patience to sit through the dull bits. Hand sitting, the most important skill a trader can have.

weekly chart

AVNR Nov 1

 

$TUES

I mentioned earlier in the week that I had moved my stop up to a close under $18 – I’ve actually got a hard stop in at $17.47, just to be clear.

weekly chart

TUES Nov 1

 

$TUBE

My stop is a close on the daily below $12. A good trade I can take absolutely no credit for – just riding the Howard Lindzon coat-tails here. It’s working quite well, and despite the lack of data, has a solid daily chart.

daily chart

TUBE Nov 1

 

$NOK

I charted my trade thoughts on this one at the time, and I’m still waiting patiently to see if I was right or wrong. More hand sitting. Stop remains at $7.55 – it came within 3 cents of that a few weeks ago…but didn’t hit it.

weekly chart

NOK Nov 1

 

$AAPL

Current stop is $95.18 . It’s a great looking chart, and if you can’t see the trend, then I don’t know what to say. And no, trends don’t last forever. That’s why I use a trailing stop.

weekly chart

AAPL Nov 1

 

$BRK.B

This is the black sheep. I’ve had these shares forever (in certificate form, no less), and they’re really more than a mere investment for me, so I don’t really count this as an active postion. If you’ve been to the Omaha love-in, you’ll understand. I rode these shares from the highs in ’08 to the Supercuts haircut they received in ’09, so that should say something about my dedication to Warren Buffett.

weekly chart

BRK Nov 1