Spydertrader's Jack Hershey Equities Journal II

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Thanks. It makes sense. I actually switched to the "stop-offest" method too, and I firmly believe in the importance of the money management.
Quote from Spydertrader:

In Journal One, I used a 2% stop followed up by a 5% trailing, then tightened up all stops as I reached the end of the maximum hold period, but I now use more channel based (Jack's Stop Offset) methods for stops. The reason for this change has to do with trying to create watch lists of stocks as described in the Bruno R post. In addition, Jack's Too Long Post provided some insights into the necessity for altering my methods slightly (to move to the next level). Keep in mind when using any stop (including a 5% trailing stop), I still maintain the risk maximum of 2% of equity.

- Spydertrader
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Spydertrader, in order to make sure I've got the list management (culling) process right I put together a simple workflow that helps me to understand the steps and tools involved in the process.

I know this is subject for the first Journal, but I just started on this method 3 weeks ago. I'm sure most of the members in this thread are way beyond this point and will be boring to hear it again but I was wondering if you or any other experienced member could validate the steps in my diagram (sequence, naming, etc)... any suggestions or corrections are welcome.

thanks. :(
 

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Quote from 4XIS4U:

Any suggestions or corrections are welcome.
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Nice flow chart. Under the First Filter Criteria, you currently have your price parameters set between $15.00 and $60.00 USD. Many traders (myself included) currently use, $10.00 to $50.00 USD for their parameters. In addition, I no longer separate the initial stocktables.com sort into three lists (sevens, ones and zeros). The automated scoring within the Hershey Chartscripts makes the three list creation step unnecessary. In Jack's most recent post regarding equities trading (linked by cnms2 above), Jack states he uses 80 for both EPS and RS values now. I also have been sorting from stocktables.com in this fashion for quite some time. Lastly, I run through the entire paradigm each night, rather than weekly as your flow charts suggests.

I hope you find the above information helpful.

- Spydertrader
 
what i want to know is how jack can keep his equity streams half full at all times. as he says, rotating in and out once every couple days.

from my perspective right now (the mental picture i have), the only downside i see is the many days without a decent candidate. In other words, my cash is on the sidelines but all that i've read of jack's writings would suggest that i should be getting more candidates?

maybe it is a function of jacks years of experience letting him take and handle trades that would be riskier for myself (due to lack of such experience.)
 
Quote from Dantheman:

Maybe it is a function of jacks years of experience letting him take and handle trades that would be riskier for myself (due to lack of such experience.)
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The biggest difference between the level at which Jack trades and what we have discussed throughout Journals One and Two stems from where in a stock's natural cycle one chooses to enter a trade. We might term these discussions as more of a 'beginner' method compared to Jack's 'expert' level trading. Jack hoped sharing his 'beginner level' methods would allow newer traders to enter into trades which had the highest rates of success. By experiencing a certain level of immediate profitability, one could then move onto intermediate and advanced level techniques - without fear of losing a significant portion of one's account. At any time a trader felt uncomfortable, that trader could always fall back on their previous success attained at an earlier level of expertise. In short, Jack hoped to teach traders to crawl before the attempted to walk, run or fly. Jack added his "Too long" post to Journal Two in an effort to motivate people to make the transition to the next level - not to simply look for breakout trades at the 'turn' of the natural cycle. Jack attempts to enter and exit his trades based on money velocity alone. In other words, he buys into equities which make the most money per unit of time and sells equities which make him the least per unit of time.

It is important to note that neither this discussion, nor Jack's decision making involves short trades at this point. Jack simply looks to make the most money by holding stocks which rise in price the fastest. Both The 'Bruno R' and 'Too Long' posts provide some insight into how a trader might transition along the path toward improvement from beginner to the next level of profitability. Looking for 'continuation' trades, as well as breakout trades, should provide that increase in profits we all seek.

- Spydertrader
 
Sold 1200 shares into the small gap up this morning. Holding 400 shares 'just in case' PWEI decides to move higher after a small pullback.

- Spydertrader

<img src=http://www.elitetrader.com/vb/attachment.php?s=&postid=1021057>
 

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Sold my remaining shares of PWEI when it did not appear the stock planned to head higher this morning.

- Spydertrader

<img src=http://www.elitetrader.com/vb/attachment.php?s=&postid=1021081>
 

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Quote from Spydertrader:

The biggest difference between the level at which Jack trades and what we have discussed throughout Journals One and Two stems from where in a stock's natural cycle one chooses to enter a trade. We might term these discussions as more of a 'beginner' method compared to Jack's 'expert' level trading. Jack hoped sharing his 'beginner level' methods would allow newer traders to enter into trades which had the highest rates of success. By experiencing a certain level of immediate profitability, one could then move onto intermediate and advanced level techniques - without fear of losing a significant portion of one's account. At any time a trader felt uncomfortable, that trader could always fall back on their previous success attained at an earlier level of expertise. In short, Jack hoped to teach traders to crawl before the attempted to walk, run or fly. Jack added his "Too long" post to Journal Two in an effort to motivate people to make the transition to the next level - not to simply look for breakout trades at the 'turn' of the natural cycle. Jack attempts to enter and exit his trades based on money velocity alone. In other words, he buys into equities which make the most money per unit of time and sells equities which make him the least per unit of time.

It is important to note that neither this discussion, nor Jack's decision making involves short trades at this point. Jack simply looks to make the most money by holding stocks which rise in price the fastest. Both The 'Bruno R' and 'Too Long' posts provide some insight into how a trader might transition along the path toward improvement from beginner to the next level of profitability. Looking for 'continuation' trades, as well as breakout trades, should provide that increase in profits we all seek.

- Spydertrader
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I think this post clarifies a lot of the questions that arise from learning Jack stuff. He posts on several different levels at one time that may seem contradicting at first but pleasantly falls right into place as the process of learning trading continues.

Iterative Refinement is the name of the game. Thanks for the great post.
 
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