folks, i had to add some money again and my overall 'investment' into this trading adventure :o(. the costs of my trading study + the study of my soul since the very beginning in march 2007 reached € 3,333. what a nice number, isn't it?
well, i'm still trying to trade in the position-trader-mode even if the market seems to favor day-traders :o)). but as i know that i do not have enough time during the regular trading hours [and probably also not the appropriate intuition :-], so i do not really try day-trading now... well, i do often use a 5% trailing stop, but the huuuuge market volatility throws me too often out of my positions just to show me that the market moved in my anticipated direction later... well, i have to use stops anyway (compare my former lessons learned :o] as they help to protect my trading capital in case my opinion is absolutely wrong (btw, i would never, never, never believe that oil will fall from $150 to $35 in few months and without stops i would probably loose all my money while betting on its recovery starting from about $85, isn't it?)
open positions (all contracts are on the 'long' side :-):
2 x natural gas
1 x silver
1 x coffee
1 x orange juice
1 x sugar
... to do ... purchase date + price, stop limits, ...
well, i'm still trying to trade in the position-trader-mode even if the market seems to favor day-traders :o)). but as i know that i do not have enough time during the regular trading hours [and probably also not the appropriate intuition :-], so i do not really try day-trading now... well, i do often use a 5% trailing stop, but the huuuuge market volatility throws me too often out of my positions just to show me that the market moved in my anticipated direction later... well, i have to use stops anyway (compare my former lessons learned :o] as they help to protect my trading capital in case my opinion is absolutely wrong (btw, i would never, never, never believe that oil will fall from $150 to $35 in few months and without stops i would probably loose all my money while betting on its recovery starting from about $85, isn't it?)
open positions (all contracts are on the 'long' side :-):
2 x natural gas
1 x silver
1 x coffee
1 x orange juice
1 x sugar
... to do ... purchase date + price, stop limits, ...
2 comments:
I read an article about using put options to replace the stop. The strike price of the option would be your stop. That way you protect your downside risk, but don't get stopped out if the trade ends up turning and going in the right direction. Sounds expensive to me, but the article says some professionals use this tactic.
hello gb41wd :-)
yes, using put options instead of stop limits is also an idea to protect the own portfolio. a buddy of mine sometimes uses that strategy if there are turbulent market phases very likely and for some reason he don't like to sell his positions (e.g. for some tax related reasons like to reach the minimum holding period to avoid taxes on gains) ... but in this case he also can't participate on market movements because his put options 'insurance' and his current portfolio positions are well balanced, so the one side loses approximately the same amount which the other wins ...
in the case of my CFD-trading-account are the amounts much too small to implement that strategy ... but this strategy could probably come in place for my mostly buy-and-hold-oriented precious metals stocks portfolio in 2009 as there is a new tax regulation in germany saying that starting from january 1st are ALL GAINS on new stock trades tax relevant! therefore it will probably make more sense to protect the old stocks (= bought before 2009) with put options instead of selling these old stocks and paying tax on every new gain after re-entry in these positions ...
thx for your response & your strategy considerations + good luck with your trading :o),
jaro.
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