Spydertrader's Jack Hershey Equities Trading Journal III

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First trade after being away from it for a very long time. Just starting up again so starting with paper trading. This is what I have for today...

The following stocks are in DU today.

GIGM NVEC RATE

Volume Alerts:

NVEC 11:10AM PRICE:29.56 UP/DN:UP MACD:0.1318 STOCH:79.89
-- 11:15 took trade 240 @ 29.60
-- Reached FRV so held position, close @ 31.88
 
Please see the following press release for NVEC, released today at 4:06 PM on the DJ newswire:

NVE Quarterly Results Conference Call Scheduled

EDEN PRAIRIE, Minn., Jan. 8, 2007 (PRIME NEWSWIRE) -- NVE Corporation
(Nasdaq:NVEC) announced that it plans to release its financial results for the
quarter ended December 31, 2006 on Wednesday, January 17, 2007 after the close
of the Nasdaq Regular Market. The next day, Thursday, January 18, 2007, the
company will hold its quarterly conference call at 10:00 a.m. CST.

It appears that we don't have to worry about earnings for this postion this week. If someone has a different earnings date, please let me know. Generally, Esignal's Dow Jones news service has been spot on in the past, so I was going to rely on the above information.

- Huskydog


Quote from buffalow:

I got in NVEC a little late, too - just below $30. I noticed they're scheduled to announce earnings after the close this Wednesday - just a heads up for anyone else who may have entered today.
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The company website lists the conference call for Thursday, January 18, as noted in the Dow Jones press release:

http://www.nve.com/investorEvents.php

Quote from Huskydog:

Please see the following press release for NVEC, released today at 4:06 PM on the DJ newswire:

NVE Quarterly Results Conference Call Scheduled

EDEN PRAIRIE, Minn., Jan. 8, 2007 (PRIME NEWSWIRE) -- NVE Corporation
(Nasdaq:NVEC) announced that it plans to release its financial results for the
quarter ended December 31, 2006 on Wednesday, January 17, 2007 after the close
of the Nasdaq Regular Market. The next day, Thursday, January 18, 2007, the
company will hold its quarterly conference call at 10:00 a.m. CST.

It appears that we don't have to worry about earnings for this postion this week. If someone has a different earnings date, please let me know. Generally, Esignal's Dow Jones news service has been spot on in the past, so I was going to rely on the above information.

- Huskydog
More...
 
Quote from Huskydog:

It appears that we don't have to worry about earnings for this postion this week.

- Huskydog [/B]
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Yup, it's January 17th. I was off one week. Sorry for the confusion.
 
Quote from Spydertrader:

Nice little move so far. Hope it keeps moving for you.

- Spydertrader
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Thanks Spyder. Hopefully my third trade works out. I've got a stop on NVEC at $31.20. Looks like it needs to take out $33.79 (top channel looks like $34.25). I will try to enter my P/L as I go along. Hopefully it would teach me as I go along. SIRF was a wash for me.

As I have a "job":D , it is a challenge trying to monitor these things during the course of the day...any tips would be appreciated. Being in the westcoast also means that sometimes I cannot watch the low band DU being hit (as I'm on the road by 7nish pst most of the time).

Question:
On position sizing, should one go for a fixed shared size or a fixed dollar amount? If one had $25K to start, how many positions should that be? While I know there are a lot of theories out there, I would appreciate the opinions of those who have traded Hershey over the years.

Ultimately, compounding the money by 2% monthly consistently would be a feat in itself!

As always, im thankful for the help.

Tomorrow's DU: BITS GIGM REDF SIM XING
 
Quote from virgintrader:

On position sizing, should one go for a fixed shared size or a fixed dollar amount? If one had $25K to start, how many positions should that be?
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In the beginning, I recommend only trading 100 - 200 shares maximum in an effort to gain a proper perspective for having your own money in the market. In addition, the mistakes we all make when taking our first steps don't hurt nearly as much with small size. If you have previous experience trading the markets, theses two pieces of advice may not necessarily apply. Increase your size slowly over time, as soon as you feel some trepidation over possible losses, scale back to your previous level and wait awhile before increasing size again.

As to risk, I posted a free risk calculator in Journal One.

Once again, very nice trade.

- Spydertrader
 
Quote from virgintrader:

I've got a stop on NVEC at $31.20
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I'm wondering how you arrived at this price for your stop. I'm going to be away from the screen tomorrow and have been debating whether/where to place a stop order. I hate the thought of getting taken out on a quick dip only for the price to quickly recover - which is why I normally use 'mental stops' in order to monitor the context in which my stop price is hit.

The Wealth-Lab script calculates a stop offset of $1.68 for NVEC, the basis for which appears to be the low for the bars on either side of a downspike. If I'm understanding how to properly apply this stop (which very well may not be the case), it would be placed $1.68 below today's low at $26.33 (28.01 - 1.68). This represents a 12% stop loss from my entry point which leaves my total account overexposed. I don't risk more than 1 or 2% of the total on any one trade.

I may just place a stop at my breakeven price point. This would appear to provide enough room for a pullback, but protect me from a serious reversal.

I would like to hear about your approach and how you determined your stop price. I appreciate yours and everyone else's input to this journal and I value any feedback.

I'm also attaching a document on stop offsets I grabbed from one of the earlier journals.

-Buffalow
 

Attachments

Quote from buffalow:

I'm wondering how you arrived at this price for your stop.
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I cannot speak for Virgintrader. However, I can provide some greater insight into the use of the 'Stop Offset Method.' Keep in mind, we have reserved 'stops' as a protection method for a catastrophic failure of some sort. We do not use stops for 'exits.'

Attached, please find a Daily Chart for SWFT. Notice the thick Purple line running parallel to our Thin Green Channel. This line marks (for educational purposes only) our hypothetical 'Stop Offset.' Notice also, the Stop Offset improves in price as each day passes. While one might begin a stop offset for NVEC, $1.68 outside the last low, certainly, the steep uptrend created by NVEC three dollar price move today would significantly improve the stop for tomorrow.

In addition, one should consider tightening up the offset as profits increase and days pass. However, (and this is only my opinion), once a trade moves well into profit (as NVEC has), I make absolutely sure I don't walk away with a loss. In other words, I'd rather set a stop at a dollar profit and miss out on price running further (after stopping me out), than set the stop too far away (by strictly following a rule set), and risk walking away with nothing - or worse yet, a significant loss.

Of course, your mileage may vary.

- Spydertrader
 
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