Hi everyone, This is going to be a journal for my efforts to be profitable in my $3k (down to 2.4k) Robinhood account. I am hoping to keep myself honest through a public journal and also like to get feedback on trades. A little bit about my trading background: I have been a retail trader since 2008 and have not been profitable overall. Jesse Livermore would have recognized me one of the suckers who know enough to talk about trades but not enough to be consistent. I started out with the libertarian/Peter Schiff/inflationary gloom doom mind set and was lucky to be profitable from 2008 to 2011. Then reality kicked in and through accounts blowing up I learned that I had it all wrong. Fast forward to 2016, I started reading up on trading/investment classics, e.g. Harry Browne, Ben Graham, Peter Lynch, Jesse Livermore, etc. Through it all, I learned to separate investing from trading, beta from alpha. I am of the opinion that one should only have a small trading account while most of his nest eggs be in some portfolio well balanced along the line Harry Browne suggested. Now that I took away the larger chunk of my assets away from the danger of trading. I would like to learn how to be consistently profitable, in a small account. I am convinced that short term, concentrated bets are the way for the small trading account since I will be the first to admit that I am not capable of the patience and hard work for fundamental analysis. As far as trading weaknesses, I am just like most people out there. I am usually slower than the market and not able to anticipate short term direction. I can be influenced by fear and greed. I can bet too much with options. This is why I thought I might get more eyeballs on me though this journal. My current trading plan is the following: I will get into an equity position I like with roughly $500 (in the case of options, just find equivalent delta with long expiration), and pyramid up with roughly the same amount if the position have two "good" up days in a row. If I have two significant down days in a row, I will exit the position. If I have pyramided up, then the stop loss should be set at the average cost. I also found that better things generally happen if I trade in the last two hours of the trading day, so that will be my entry time. As far as entry triggers, I am now of the opinion that both mean reversion and breakout will make money. I am also not confident in my tape reading yet as far as catching the market. I do like to have the trend working for me, e.g. GE right now is not my cup of tea as I don't want to be the hero hitting the bottom. Right now my account has the following positions: 4 F $8 put expiration on 3/15/2019 @ average cost of 22.5 1 Orly share bought on Thursday, 11/8 @352.5 10 Etsy share bought on Friday, 11/9 @54.5 I hope to stick to the plan and show a profit for November. Let's see what happens.
Following up on the trading plan with more details: entry is made either at 52 week high for a stock, breakout or bottom of a trading range longer than 20 days. The definition of a good up day: close higher than previous day high. The flip side for a bad down day: close lower than previous day low.
Got out of Etsy @50.9 near the close. Got in KO @49.8 near the close for 10 shares. The put for F is nearly unchanged for the day, but F is surprisingly strong in a risk off day. I believe F's strength is similar to that of VZ, T, etc today, with traders looking for high dividend hideout. Overall, the market might head towards the October low for a test. Oil market is also indicating worries on the general economy. However, in a choppy market like this, it is probably too late to find short term shorts....
Today is a bad day from a psychological point of view. Saw a nice open up in my ORLY position and forgot the rule of trading in the last two hours. Added another share at 360.4 and saw the gain quickly turning into negative territory before the stop out activated at the average cost. Meanwhile, F continued to outperform market and my put didn't result in gain. Near the close, I initiated a 9 share position in XLE but decided to take a 3 dollar loss as the close turned south. So I broke two rules in one day: added position before the last two hours of the day and got in and out of a position too quickly.
F finally broke to the downside and the put options are profitable now. Sold two out of four but look to buy more when the vix index is back to 15 and F stays above 9.20. Ko was mostly flat. As I suspected, shouldn't have gotten out of XLE yesterday. I thought about getting into EOG but decided not to as it had a nice rally today and I was hoping for sub 100 entry. Got into 5 shares of WMT at 99.3 and 15 shares of PCG at 24 after hours.