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A Trader's Journey: Bel (Nov 2007) Print E-mail

A Trader's Journey

Trader: bel
Profile:
  • Investor & Trader
  • Technical analysis, as primary trading tool
  • TINO member since February 2005
  • Queensland, Australia

 

 

 

 

 

 

1. When and how did you first get exposed to share investing/trading?

I bought 15oz of gold bullion when I was 18 and sold it for a handy profit a year or so later. This led to an interest in stocks.  I started following a couple of stocks in the financial pages of the local paper and watched one of them rose from 15c to 54c in a couple of days.  From that point, I (unsuccessfully) dabbled a bit, but lack of funds soon kept me out of the market, as I had purchased a house and land.  Over the years, my interest in the stock market remained.

2. On what basis did you make your first investment decisions?

Broker's recommendation, and naively looked at stocks that were trading near their 52 week low, thinking they were cheap.

3. If you could turn back time, what would you have changed?

No matter how modest, from the moment I started working, I should have started to consistently accumulate good quality stocks with whatever small change I could scrape together.

4. What do you think are the most important lessons you have learnt in your journey as an investor/trader?

To be patient and stick to the plan, to know when to be aggressive, when to be defensive, when to stand aside, and that you never stop learning or trying to perfect your skill.

5. Has TINO influenced or helped you in your journey as an investor/trader? If so, how?

Yes. I enjoy my own company but found trading a bit of a lonely business. The sense of sharing and belonging to a group of people striving to achieve similar goals has been inspiring.  It encourages and educates, whilst offering a sense of community with people at various levels of experience and trading/investing styles.  The mentioning of stocks and sharing of charts often leads to one being added to my personal watchlist where I apply my own strategies and often end up with a profitable trade.

6. In what ways do you think TINO could help you more?

Ongoing education perhaps. For example, every now and then, we could all share an actual winning and losing trade and open it up for discussion.

7. How would you describe your current investing/trading process and methodology?

I start with my watch list which I hand pick through eyeballing charts.  The list usually consists of less than 100 stocks.  I also like the simplicity of trading sector CFDs.  I source 95% of my trades from my own watch list, 5% come from suggestions on TINO, magazines,  newspapers and other websites.  I continually revise and update the list with a major review on a monthly basis.

My trading is based on TA. I keep things very simple using candlesticks, support and resistance, moving averages, and occasionally volume.

I find the more I listen to the news or other commentary, the more my trading suffers because I get too many conflicting information in my head. If I ignore it and concentrate on what's in front of me, my results improve.

Typically, I look for strong closes in up-trending stocks.  I regularly buy new all-time-highs and 90% of the time I execute my entries at the end of the day. My core stock selection criteria is share price trend. I will hold for as long as the trend holds up.  Occasionally, I take long or short opportunistic trades throughout the day simply using support, resistance and depth.  I've held trades anywhere between 10 minutes to 1.5 years. I trade both long and short, use trailing stops, and record everything on a spreadsheet.

8. Describe your typical trading day.

The first thing I look at is what has happened on Wall Street overnight, where the futures market is headed on open and what the implications may be for my open trades. Before the market opens, I would have set up a "hot watch" list for the day.  I always have my strategies fairly clear in my head prior to market open. Then, I read market news, scan and eyeball charts and log onto TINO.

When the market opens, I monitor the action for the day, and look for more opportunities. If things are slow, I sneak out into the garden for an hour or two to get away from the computer but am always back for at least the last two hours of trade.

After market close, I update my spreadsheets and usually spend an hour or two each night analysing stock and sector closes and the things I could have done better over the last month.

9. What do you think is the most difficult part of your job as an investor/trader?

My long term investments take little management, but with my trading I find the drawdowns the most difficult. There are highs and lows, and during the lows it's easy for self-doubt to creep in. I've found the market has a way of pushing you to that point now and then. You have to totally believe in yourself and what you're doing and keep a perspective on long term outcomes.

10. Is there a particular aspect you would like to improve in your current investment know-how?

Trading experience is the main one, which is something only time can provide.

Books are great for theory, but there's nothing like the experience of sitting in the trades, whether they're going in my favour or against me, and especially in changing market conditions we are having now. It's been a great experience and I have learnt a lot of lessons.  I've only been trading full time for around four years.

11. What are the essential tools you use as an investor/trader?

Laptop, reliable internet connection, reliable trading platform, reliable data provider, two charting packages, Excel spreadsheets, phone, TA newsletter, a few select websites, a few good trading books and magazines, and an account with some 'fat' in it.

12. Are there particular books you would highly recommend to other fellow investor/trader?

Japanese Candlestick Charting Techniques - Steve Nison
Trading for a Living - Alexander Elder
Entries and Exits - Alexander Elder
High Probability Trading - Marcel Link
Trading in the Zone - Mark Douglas
Making Money From CFD Trading - Catherine Davey

13. What do you think are the essential qualities of a good investor/trader?

A solid plan, good money-management, self-awareness, patience, level-headedness, common sense, and self-belief.

14. What advice would you give to a new investor/trader? Are there any particular common pitfalls you want to point out?

Learn by getting into the market with a small amount of money and a good understanding of the risks.

Paper trading is just not the same. Nothing is like putting real money on the line. You've got to feel the joy and the hurt and then slowly work those emotions out of your trading.

15. Is there anything else you would like to share or you think will be helpful to mention?

Trading is hard work. But even on a bad day, I still have a good time. Having the passion for trading means a lot. Persistence and common-sense are the keys to trading success.  I hope I'm still doing this when I'm 85. I love it.

 

 


 


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