AAR & TOL 03 (Aug 09 - Dec 13)

[kennynah]

no greed and no fear....there wont be a stock market anymore loh...

[Aspellian]

TOL:-

Make sense or not ? When the Dow go up 150 points, the people here are running out to buy stocks. When the Dow is down 150 points, the people here are panicking and selling stocks.

Herds move together - safety in numbers!!

the challenge is to move along with the herd and not be trampled. feel the warmth and comfort and excitement. but when the herd start to panick and start thinking of heading for the exit. be the first to quietly leave the party. the exit door is very small.

its truly an art - Now i'm reading Mackay's book on Extraordinary delusions. Humans never ever change! never mistaken a tulip for an onion!!hahahaha!!

[b0rderc0llie]

Herds move together - safety in numbers!!

the challenge is to move along with the herd and not be trampled. feel the warmth and comfort and excitement. but when the herd start to panick and start thinking of heading for the exit. be the first to quietly leave the party. the exit door is very small.

I view the above as momentum investing. As with all other logical methods, if done correctly, is profitable.

I play a different game. I go against the herd, letting them trample me, feeling the coldness, discomfort and boredom of being the odd one out . When the herd start to panic and head for the exit, I am already there, and the fun begins...

[Aspellian]

Herds move together - safety in numbers!!

the challenge is to move along with the herd and not be trampled. feel the warmth and comfort and excitement. but when the herd start to panick and start thinking of heading for the exit. be the first to quietly leave the party. the exit door is very small.

I view the above as momentum investing. As with all other logical methods, if done correctly, is profitable.

I play a different game. I go against the herd, letting them trample me, feeling the coldness, discomfort and boredom of being the odd one out . When the herd start to panic and head for the exit, I am already there, and the fun begins...

wow! but that requires the skill of a hunter - patient, silent and deadly. waiting at the exit but yet not trampled till the point of no return!

A skilled hunter needs a faithful bordercollie to help the hunter sniff the good hunts/deals!! Cheers!

[Poles]

TOL:-

Make sense or not ? When the Dow go up 150 points, the people here are running out to buy stocks. When the Dow is down 150 points, the people here are panicking and selling stocks.

it depends on which angle u'r looking from......when it is up 150 points people are running out to buy from the people running to sell.....vice versa

[kennynah]

to do the above... you really need very deep pockets or an extraordinary skill in properly hedging your positions to mitigate losing positions...

i;ve got to pick your brains on this...share share your strategy leh....

[winston]

it depends on which angle u'r looking from......when it is up 150 points people are running out to buy from the people running to sell.....vice versa

When market goes up, more people are running out to buy than to sell ..

[kennynah]

Herds move together - safety in numbers!!

otherwise known as .... monkey see, monkey do

[winston]

TOL:-

The market has been strong the past few days so it's time to be clear about the strategy:-

1) Will you be selling into the strength ?

2) Will you be buying on the coming dip ?

3) Will you be holding and hoping that the rally can continue ? This is also equivalent to buying at the current price.

4) Will you be shorting ?

5) Will you be waiting for the rally to continue before shorting ?

Didn't expect a simple post to generate so many options ..

[kennynah]

the first item up in the list of consideration, is and will always be ....

how to achieve a desired return and yet contain risks to the minimum...

this sounds like motherhood statement... but it really isn't... it is if one simply trades stocks...it isn't when one employs options/futures along with stocks....

for example, we use this simple illustration, ... if one believes that this rally is going further up.... and chooses to Long stocks, this is a huge risks exposure for potentially unlimited reward. instead, if one chooses to Long a Call, the same potential for unlimited reward is there BUT with a limited risks exposure...

for most of us, we tend to focus more on the possible +ve aspect of our trades, but neglect or give insufficient attention to potential losses... it is human to be optimistic, but it is not enough just to be when trading...

therefore, whether one chooses to buy on dip, open new Shorts at highs, holding onto a position, we must constantly protect our capital...this is the ONLY way to ensure a long and lasting trading endeavour....

it appears that i am missing Winston's main questions... you are not wrong to derive this conclusion... my addition is that when we decide to put on a trade, i feel, our foremost focus should always be on risks mitigation... and given the same reward profile, the trading strategy that exhibits the least risks, is the optimal one...

thus... to decide whether i should buy on dips or Short on highs, it will be based on my maximum risks that i am willing to accept for that trade and then measure the potential profits and if the risk/reward makes sense, i'll go for it...

that's how i'd do it...and you?