Personal Journey - The Goal is Survival

Discussion in 'Journals' started by anglagard, Jul 28, 2011.

  1. Hello readers.

    You are about to read a personal story. I'm glad the Internet allows some level of anonymity because some parts are painful to write and via this medium it all makes it a bit easier or I should say, less hard to express my story/situation.

    I'm in my high 40s, married to a beautiful wife and have 4 children to support. If you are a family man you know this is a hand full.

    I was raised by only one parent, unfortunately recently, about a year ago, I lost the only parent I ever had due to a car accident. To say the recovery process has been hard is a complete understatement. Entered a long lasting depression which in turn got me to lose my job. Never had the luxury of a formal education and in times of economic uncertainty and high unemployment I don't have many options. Thankfully the family stood by me and because of them and my responsibilities to support them I have been able to stand back up emotionally.

    My beloved parent left a modest inheritance. Something close to 400,000 US Dollars and minor bills. Since losing my job I have been using part of it to support my family and pay my bills but now that I'm back on my feet I realize, it's limited money and it's not going to last forever. 60,000 are already gone so it's down to 340,000. Needless to say, it's a wake up call.

    As I looked for employment I visited several investment houses looking for ideas on how to invest my capital. To make a long story short, on every visit I felt cheated. Did not like any of the options, they felt too risky, illogical and in many cases, impersonal. Don't mean to disrespect anyone but my experience with brokers was very scary.

    This has forced me to become sort of an autodidact and learn whatever I could about the markets. During my learning process I realized this is not an easy task, it takes probably as much time or more as a the college degrees I don't even have but it's something I enjoy and I perhaps even see myself using it as mean for income.

    I have spent an enormous amount of time studying suggestions and techniques from traders in this forum with a good heart and a sense of giving, this has helped me continue my research into the proper path; at least it looks that way as I like what I see when I study the markets.

    Feeling alone in my journey, as this is a profession my family is not really apt for discussion, I have opened myself to a public forum in search of friendship and guidance.

    Plan to share my educational development in hopes of reaching new horizons and become interactive with fellow traders.

    In the meantime, any suggestions on long term investments, I'm all ears and would be very appreciative of your sharing. At the moment most of the capital is just sitting on a savings account gaining ridiculous interest rates.

    Hope this journal becomes special to me and perhaps to others.

    Pleasure to meet you all and God bless.

    Joe
     
  2. Hearfelt story there my friend.

    I wish I could give you long term investment guidance but I'm afraid my expertise there is very low. Let's hope others can say otherwise and give you a hand.

    As far as trading, looking forward to seeing your charts, see what methods you are using and perhaps offer some ideas as your trading evolves.

    Here's for the best, wishing you success Joe!

    FoN
     
  3. PetaDollar

    PetaDollar Moderator

    Take $30k and open a cash (not a margin) account. Give your wife control of the rest and instruct her to shoot you if you come and ask for more trading/investment money.

    Risk very small amounts ($100-$300) in any given trade with your new 30k account. You are not trying to make a living with trading, just trying to see how it goes for a year or so. There is a lot to learn, and most people can't do it no matter how hard they try. You are not a sucker and have good instincts, and sound very conscientious, so I'm giving you a 90% chance of success if you work hard and take good notes. :)

    Notice I didn't say a darn thing about trading strategy. You have to get the money management right first. You are not in a position, at the moment, to be trading or investing that whole wad.

    If you blow out your account, you can decide later if you want to try another 30k. If you make a lot of money with the 30k, please do not get greedy and dip into the wad. Just keep working your account.

    That's just my advice. No matter what you decide, you need a money management plan. Please talk it out with you wife and write it down in your journal, whatever you decide.

    And note well. The part about your family (wife) in this case not being apt for discussion, well, that's a no go. Your wife needs to be on board and understand at least the basics of what you are doing, or you are almost guaranteed to fail.
     
  4. Listen carefully to this. Very wise words.
     
  5. PetaDollar,

    Thank you for taking the time.

    I was planning on opening a 40,000 trading account with Interative Brokers, never thought about using a non margin account but will take your advice under consideration. I suppose the reason for this is to prevent me from trading more than I should under stressful events.

    One thing I've learned during my research is that discipline is key, planning the trade, trading the plan and no deviation.

    This is my future and the future of my family, I'm not planning to gamble with that.

    You mention 100-300.00 risk per trade using a capital of 30,000, sounds like you are suggesting risk to be no more than 1% of the trading capital no matter the trade. Sound advice and no different from my findings.

    Still looking for ways on how to let the non trading capital beat those terrible bank rates with reasonable low risk, perhaps I'm asking for the impossible, that is something I have not been able to answer just yet but I do know greater returns come with greater risk.

    Thanks again.

    Joe
     
  6. Did and doing so as I type this.

    Thank you for the affirmation.

    Joe
     
  7. cloudy

    cloudy

    It's good you have a decent amount to trade with if you so choose. So a main problem of being underfunded you might have a leg up on. Also be wary. Emotional trading can get things out of control. Check out Neke's thread for example.
    http://www.elitetrader.com/vb/showthread.php?s=&threadid=213286

    Lesson is always trade with a set risk, maximum 5% for any trade , most "pros" do 2% or 1%
     
  8. Money management trading plan so far as of 07/28/2011

    (Under review)

    Deposit of 40,000

    Margin enabled but I won't use it, if I'm to exercise discipline this is an unbreakable rule.

    Maximum risk per trade 400.00

    Two minimum reward targets:

    First target 2x the risk half size.

    Second target a runner > 2x if price action allows it otherwise 2x is the final target.

    Stop and target determination before the trade begins.

    Rest of the capital in savings account until an obvious better solution is found.

    Will discuss this with my wife tonight, if things go well, will begin the application process tomorrow.

    Joe
     
  9. Cloudy,

    First of all, thank you for taking the time.

    Lots to read and digest but being unemployed time is something I got. Will definitely read it all.

    Keeping it real, I'm not new to trading but the live part needs ample experience. Would classify myself as somewhere in the middle.

    Joe
     
  10. Trading tools at my disposal.

    Ninja trader v7 with Kinetick Live feed

    freestockcharts.com

    finviz.com

    Don't want to overwhelm myself with tools for the time being. I suppose the broker can supply the rest.

    I know Ninja Trader can annotate my trades right on the charts with entry and exit. Once the trading begins I plan to post the charts with the annotations for the "ET World" to see for clarity and transparency.

    Joe
     
    #10     Jul 28, 2011