20% up in one month, can it be maintained ?

Discussion in 'Professional Trading' started by abdo, Jun 1, 2006.

  1. abdo


    I know this may sound familiar but it truly happened to me and I liked to get your feedback about it.

    I started trading one month ago just knowing some of the basics and not even familiar with all order types.

    I started with $3000 and in one month I gained $600, actually during this month in just one week I was up to $4000 then was pulled down to $2600 then made it back up to finally $3600.

    I never put stop loss orders either with the broker or even mentally.

    I usually pick low priced stocks that I feel can't go any lower although most of these stocks have a daily volume of not more than 100,000 shares like WEX.

    I will fund my account with another $6000 to maximize my gains.

    Although from what I read I know I should lose but I really find this very easy or may be I have a good sense in picking stocks ?!
  2. Do it for 3 years in a row consistently then you will have your own answer. Also doing it on $3,000 is much easier than doing it on $150,000 in one month depending on your strategies.

    Yesterday I saw a rookie in baseball hit a homerun in his first at bat. Naturally that means he will hit 40 HRs a year for the next 10 years right?
  3. Congrats, if you have a viable strategy, you may continue to do well. However, it is more than likely that your no stop loss plan will put you out of the game. One other point, the markets were exceptional for trading the past month.....markets like this allow you to make big mistakes and still make money.

    Continued success to you!
  4. Depends on what level of drawdown you're ok with. Also consider that if you are trading a breakout strategy, you should look for stocks that exhibit volatility compression. And vice versa, if you are trading a fading/rangebound strategy.
  5. sound like he has no plan and that the strategy is not viable.

    swing max 4K, min 2.6k starting with 3k gives me something like 4+2.6 / 2 = 3.3 and then 3.3 - 3 = 0.3. Next 0.3 / 3 = 10%. But the 10% is less than the value of the swings hence pure luck.

    Maria over and out.
  6. abdo


    Thanks all for your comments.

    FaderTrader, I really don't use any specific strategy I just watch out for stocks that have gone way down that I feel can't go any lower.

    bali, I don't really understand the equation you posted.
  7. Surdo


  8. This is a proven strategy. Though why when you lost $1,400 in such a short period of time, you actually suggest it is a money making strategy, I do not quite understand.

    Anyway, the strategy has many names, such as "it's just like trying to catch a falling knife strategy” or the "it simply CAN'T go any lower strategy” and the "this one has nowhere to go but up from here strategy” or especially with those illiquid stocks like you mentioned the "those shorts will be forced to cover real soon strategy." All of which are proven to lose substantially all of one's entire bankroll given enough time.
  9. This game is not over until one of two things happen.

    1. you blow out

    2. you retire wealthy

    anything else is static.....
  10. Your experience is so short, it's about the same as correctly guessing one coin flip. Visions of Sugar Plums not warranted.
    #10     Jun 2, 2006