Archive for May, 2009

I am going to take in mid June a month of work. First of all I need a break and to do something else. Second I want to feel how is it to be a ‘Real’ trader that eat and breath the market all day long.

My target in this month is quite ambitious to take £2000 and make them £20000. In other words I want to make 1000% in just one month. For doing that I will use 4 strategies:

1) Going with the trend – By using tight stop loss, try to ride on a daily trend. The idea is simple you may lose more trade than you win but those you win will generate big profit.

2) Over sold / over bought – try to guess where the market is going to change direction and then buying on the opposite direction. For example if on a day the market is going down strongly, I will try to understand where is the turning point and open a long position. With this strategy there is no stop loss and I limit the profit for 100 points on the Dow.

3) Entry point. Open a position, long or short it doesn’t mater without a stop loss and with profit limit of 100 points.

4) Buying an option. Buying an option that are close to the money and wait for it to double. For example if the Dax is 5000 then my plan is to buy the 4900 put

It will be interesting to see which method will generate more profit. I will keep you updated

I took advantage of the latest rally and sold all of my shares:
Tesco, Royal Dutch Shell, Dana petroleum and BAE.

I do feel that this current rally is more like wishful thinking than a real turning point. Yes the media has lost interest in the current recces ion and they are already looking for green shoots, but I honestly believe that the problems are still here. Central banks all over the world give free money (0% interest rate) and these was the reason why we had the global crises in the beginning. Money was very cheap in the last 6 years and it is very cheap now.

This will take inflation to rocket high and although it is very good to my mortgage is not very good for the economy. And I also feel that something has been changed with people. They don’t happy to spend as they used to. You see less people taking flights or buying new cars.

So I may be wrong and the rally will continue over the next month, but I feel that it is better for me to protect my profits and sit on the fence for a while.

Because you won’t see the money…
I opened an account with them called them twice to confirm that my account is qualified to the cash back offer and twice I’ve been told I was.

So I put money and did one trade with this offer in mind. I would never else open a position on the DAX with just 25 points stop loss. Because it was more like a bet than a trade I lost which is fine.

I called worldspreads, the company that you always talk with the same person, and asked my cash back. They say no problem but nothing happened. I’ve waited 3 days to call them again and they promised me that it will be sorted on the same day. Nothing happened again. I waited 3 more days and called them today.

And their answer:
Due to the terms and condition you are not qualified to this offer. Good bye.

But I had enough. I wrote a long letter to the FSA the financial authority that should govern these companies and copied the Guardian and the Independent newspapers. And now you know about it too:
Don’t open an account with Worldspreads because there is a good chance you won’t see you money back. And also they have one of the worst platform out there.

Hi all,

IG Index has a new website and from first impression it is a big improvement from the old one! There is a new section about market update so you can get the news in one place without searching for it on the net.

The design of the site is nicer. They didn’t change the platform deal though. As I always say it is one of the best platform out there but also the ugliest! I don’t know what about you but I really don’t like to sit in front of it more than 10 minutes.

Hi all,

I am not a big fan of stop loss. I think they make you lose money. So I don’t use them. But today I had sometime and I decided to use Worldspread offer of £250 cash back.

I saw the Dax up strongly today and I know that the 4950-4975 is the upper resistance at the moment. So I opened a position to sell the Dax on 4946 with 25 points stop loss – £10 a point.

At one point I was £150 up, but my target was £1000 or 100 points. But an hour later the Dax was strong again and peaked 4978. I was out. 2 hours later it was 4900… and the again it was up to 4975 and down again.

25 points stop loss is a joke. If you really serious about trading and you still want to use stop loss then use 200 points on Index like the Dax. Otherwise you will be out before you know it.

If you don’t have an account with Tradefair this is the time to do so.
They give you £100 into your account when you place 2 bets (not on share). As far as I understand it, this is not a cash back in case you lose but £100 extra.

Read the terms & condition before…

Israel is a unique country. Go there on Christmas day and unless you know the date you wouldn’t believe it is Santa time. Go there on any Saturday and unless you bought some food on Friday you will have a problem because everything is closed.

But not about culture I want to talk today but business. And again Israel works a bit different than the rest of the world. The business days over there are Sunday to Thursday. Meaning that the Israeli stock exchange is closed on Friday but opens on Sunday.

This gives a huge advantage to see where the market will go on Monday. Israeli investors watching closely what is going on in USA and many stocks are double listed on both stock exchange. So on Sunday evening you can check what the Israel top 25 index has done and you will get good indication which position you should open on Monday morning.

A good place to check the Israeli market is Globes and it is in English…

Hi all,

For long time I have a share account with Halifax Bank. Since I use spread betting I didn’t for long time. But I am keep coming back to the platform because they have very good research platform.

Today I wanted to check some things about Royal Dutch Shell and it is all there. Very easy to use and pleasant for the eyes. On top of that if you want to deal with shares they offer competitive rate of £11 per transaction. It is one of the cheapest in the market. Although you can find £6 as well depends on how much you deal per month.

This is a great book from Elder Alexander. I am still reading it but it is so good that I’ve decided to stop trading until I finish the book. Come into my trading room explain in plain English how the market works and the psychology of traders.

A must book!

Stupid Newham council has took my car because according to them I parked in foot path. Needless to say it is bull$hit but it cost me £250 and half a day which I wasn’t happy with it at all. I can dedicate a whole blog about Newham and their annoying mayor, but this blog is about money and not politics.

So I promised my wife that I will cover the lost with spread betting and I had a plan. Worldspread has offered me £250 cash back if I open an account with them. So my plan was to take this offer and cover up the (stupid) Newham loss.

But I am so busy lately that I haven’t had the time to deal. But on Thursday morning I saw the Dax at 4815 and I thought this is my chance. That day was my birthday as well so I thought it must be my luck day.

My target was to make £1000. So I’ve made a £2000 deposit into my new account and I was looking to open a short position on the Dax, £10 a point, with 25 points stop loss so my £250 cash back will be the limit, meaning no lost what so ever.

Good plan but Worldspread doesn’t offer the option to add a stop loss to an order! so I couldn’t just order and forget. I had to open a position manually and then put a stop loss. But I didn’t have the time to follow the market. I had a meeting with a client on Friday and nothing was ready yet. And it was my birthday so many phone calls.,. so my plan to open an order at 4830 with 25 point stop loss was all gone.

And what happened in the end? The Dax went down to 4730… my £1000 profit if I could stay focus follow the Dax and choose the right place to enter. Instead I had nice birthday, finish the project for my client at Friday (early) morning and still have £2000 in my Worldspread account waiting to be invested. After all I need to cover this parking ticket.