0Posted by Michael Glass on November 22, 2011 at 7:05 pm
How to Develop
Routines for Trading
In our previous post, we discussed the importance of developing trading routines. A Trading Routine could be considered a checklists you create to help you become more productive and more organized. Trading routines can also help you maximize your Return On Investment on each trade. In the end, we hope the routines outcome will produce habits of success.
We also described the three important routines every trader should develop: PreMarket, Intraday and AfterMarket. Today, we are going to focus in on how to develop a PreMarket Routine for Trading. Your routine should help you accomplish the following tasks:
Getting yourself up to date on the market; • Assessing your portfolio;
Getting ideas as to what stocks might be ‘hot’ that day;
Knowing if your positions have any new news that could cause volatility;
Being ready to trade when the market opens at 9:30 AM EST
Developing your pre-market routine is crucial to your success as a trader. Pre-Market routines help you locate new trading opportunities and plan your day so that you are not spending market hours devising new strategies but rather using your resources properly and following through with trading plan. Watch the video below for more resources on how to develop your premarket trading routine.
0Posted by Michael Glass on November 17, 2011 at 8:50 pm
How to Develop Your
Own Trading Routines
Intraday Trading Routines
A trading routine help to search out potential trades and get the information that is critical and/or important to that potential trade. Developing a trading routine goes hand in hand with being a focused and disciplined trader. We use these checklists to help you become more productive and more organized. Trading routines can help you maximize your ROI on each trade. Their outcome is to produce habits of success.
There are three types of routines every trader should consider:
PreMarket Routine – Preparing for the current market day
Intraday Routine – Adjusting for the current market climate while looking for new trades
AfterMarket Routine – Summarizing the events of the day and begin to prepare for the next trading session
Here are somethings you should consider including in your intraday trading routine:
Be aware of daily Economic Releases
Be aware of daily Earning Releases
How are the sectors of the stocks you hold or are watching performing, any changes?
1Posted by Michael Glass on October 27, 2011 at 2:57 pm
Are You Ready
to Begin Investing
Short Term Investing Goals
You’ve reviewed the outline of how your trading plan should start and you’re now ready to begin the initial stages of your trade plan. We’ll step through each piece in this series, and we will walk through the process of each step so that you can establish your trade plan and provide for contingencies.
As you recall, our first step was establishing your goals so now we need to determine exactly what are your goals?
In order to fully establish your goals you’ll need to look at both short and long term goals. For the short term, you will want to establish attainable goals that can be adjusted for long term prospects.
So for the short term we’ll look at what your goals are over the next 30 days and we’ll talk about the steps to achieve them.
Short Term Investing Goals:
A) Determine investment objectives
Everyone has a different set of investment objectives. There are those of us who trade for the sheer enjoyment of it and those of us who trade for tax reasons. If you’re trading for enjoyment, you’ll get far more enjoyment out of investing with a specified profit in mind, and for tax purposes you’ll be looking for both short and longer term investments.
For short term investing, you’ve decided that equity options are your investment of choice. Initially, you’ll want to take a look at the group of equities that most interest you, whether it’s a specific company or it’s a specific industry group. For instance, you may find that IBM doesn’t really appeal to you, but DELL does. In this case, you’ll want to focus your market research on DELL and find out the short and long term trading patterns that have been established.
B) Researching trading patterns
So you’re not quite sure where to start!! Your options for beginning research are as numerous as the number of companies that are out there. You can contact the company directly and ask for company reports, you can go to the companies website and review annual reports online, search out rating services (such as Morningstar, Zach’s or even the SEC website where you can find reports in Edgar), or you can do your own market research right online with various quoting services that can offer you unbiased information. You also can seek out an investment advisor who can help you through this process.
C) Understanding what you’re reading
It’s important that with the maze of information that you are researching that you find a way to comprehend what you’re reviewing. There are many resources available to you to make sense of all of the numbers and you should avail yourself of them. Simple searches on the internet can help de-mystify all of this data.
D) Setting your investment accounts up
You’ve figured out that you wish to invest in DELL options and you’ve done all of your research but you’re not quite clear on how to invest in the options. The first thing you will need to do is to find a broker to help you with these transactions. There are disclosures to be made by the broker to you, including their fees when you invest in a trade. Don’t forget to ask the right questions of your broker, including minimum investments (some brokers will charge a fee unless you guarantee a certain dollar amount in trades), fees for buying and selling (some companies charge different fees for purchase and sales especially with options trading), and you’ll also want to find out about settlement dates.
Your broker should also offer you all of the available literature on options trading. This includes certain required publications. You will have forms to fill out which may be confusing. Do not hesitate to take the time to read them thoroughly before signing anything! Don’t let your broker dictate what you’re doing, if you’re not comfortable with what they’re telling you, look for someone else!
3Posted by Michael Glass on April 21, 2011 at 12:00 am
Why Does the Stock
Market Hate Me?
In order to be a profitable trader, you must be able to answer the following questions:
What is it that losing traders do that winning traders seem to avoid?
What are the things that successful trader do that losing traders do not?
Why Does the Stock Market Hate Me?
Now we know that the stock market really does hate anyone. We also know that the stock market does NOT have a vendetta out against you. Yet, so many traders feel that no matter what they do that the result of the trading will always be negative. What these traders are doing is placing the blame and responsibility for their trading results not on their own actions but on outside factors they believe they cannot control. Yet, successful traders realize that it is indeed within out ability to control what types of trades we take. Or, when to take a trader or even how to manage a trade once triggered.
In his book, High Probability Trading, Marcel Link defines High Probability Trading as taking trades with low risk/reward ratio that are backtested to have a positive expectancy with predetermined money management strategies. This is a long way of developing a personalized trading plan that matches your investing goals with your risk tolerance.