DT1 Swing Trading Journal

D

DT1

Hi all,

Yet another journal :)

I live in Paris and trade Nasdaq and NYSE stocks. My initial plan was to make a living day trading Nasdaq stocks full time but after a while I realize I'd better look for a job :).

Now that I have a job I still trade afterwork. I do swing trades only.

After six months I have a better understanding of the market but still lack of consistency. This is the reason why I want to post my trades here on a regular basis. Feel free to comment my positions, stop loss strategy, entry and exit points. Any positive comment will be greatly appreciated.

DT1
 
Today I closed a position on TSO that I have been holding since friday making a small profit of 43$ on 100 shares.

New positions today
+100 ICN @ 10.03 STOP 8.99
-100 CERN @ 30.19 STOP 31.02
-100 ESRX @ 54.19 STOP 54.38
 
I have been swing trading successfully for many years..

First of all... you need to have a position size strategy.. It looks like you are betting 100 shares across the board... That is not a good idea... Get Van Tharp's book.. and read it a few times over.. and you will learn how to position size.

Second.. whats most important is the exit and position size.. not the entry or setup.

Why dont you tell us how you plan on exiting?

The best thing about swing trading.. is that you can really enjoy creative position sizing.. and your profits are unlimited as opposed to day trading where you need to be out EOD.

You have to have a game plan. Do you want to use tight stops to make big gains.. as a multiple of your stop... and be right under 40% of the time. Or do you want to use looser stops and have a hit rate near %60 and have your gains around the same size as your loss?


-MIKE
 
Hi Trend Dader,

Thanks for your reply.

You are right, position sizing is important. Since I am not overconfident about my system I will take small risks in the first place. But soon I will increase my position size.

You are right the exit plan is very important. I use to put large stops but I will use tighter stops now. Let's say a mawimum of 60c/share. Let me know what you think about it.

Today the market gaped up so I was stoped out on my 2 short positions. I am not comfortable at taking long position in bull market so I sold CSC and bought SEPR to hedge my position. I was stoped out on CSC.

Trades of today:
CERN STOP @ 31.15 : -98$
ESRX STOP @ 54.419 : -25.9$
CSC BOUGHT @ 27.44 and STOP @ 28.30 : -88$
SEPR BOUGHT @ 16.03

End of day position
+100 ICN : -85.96$
+100 SEPR : -14.99$
 
Stay with 100 shares. Don't do size when you first start out learning to trade. You will blow out your risk capital if you start trading big size when you are inexperienced. Once you find your niche, then you can gradually increase your size.
 
Quote from Trend Fader:

I have been swing trading successfully for many years..

First of all... you need to have a position size strategy.. It looks like you are betting 100 shares across the board... That is not a good idea... Get Van Tharp's book.. and read it a few times over.. and you will learn how to position size.

-MIKE
More...


trendfader,
could you explain why betting 100 shares across the board is not a good idea? and maybe explain what u mean about position size ?

i find myself doing this too, if i own 3 stocks .... i usually have the same amount of shares on all 3 ,, whether its 100 , 500, or 1000. just wondering why its not good ?

thanks alot ----------------------------tko
 
I suggest you read the book Trade your way to financial freedom.. by Van Tharp.... it goes into great length about the importance of position sizing..

You can also buy or sell less than 100 shares if necessary.. so even 100 shares is not the smallest amount of shares you can trade.



--MIKE
 
Also, search the Stocks&Commodities back issues for this one. It is a top notch article that addresses this risk mgmt issue as well. It was my epiphany for the making trading risk something I knew I could handle.

Essentially, the risk of 100sh of NYSE:XYZ at $120/sh is much different from the risk of 100 shares of ABC at $12/sh. Keeping risk pretty much equal among trades limits the loss to a manageable amount...you know its coming...just not which one it is going to be.

The main key is all but eliminate the risk of catastrophic drawdowns that would put you out of biz and get you statistically in the positive net zone.

Regards....
Bruce
 
Quote from TKOtrader:

great explanation !

im gonna go grab that book right now :( :(
More...


Explaining the importance of position sizing is beyond the scope of posting a simple message on this board...

The book I mentioned covers this in great detail...
 
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