Hard Lessons from a Trader…

I now post to http://www.insanemoney.com for anyone reading this blog. You can set up a free userid and password through Insane Money. I am working on the model portfolio.

Posted on September 24th, 2009 by Gekko

I had a good talk with Mojo (my trading partner) on Wednesday night after our team meeting regarding trading in general. Some things came to light that I should share with you all that may be of benefit to you. Many of you will hopefully see things for yourselves as traders…

1. I work too hard- Because of the way we were raised, most of us think this is a noble trait. We are taught to work hard through school so we can later get good jobs and make lots of money, right? My parents were from Italy and survived WWII time and we came to the US when I was very young. For any of you that come from immigrant families, you know the struggles of watching your parents work their tails off (many times with 2-3 jobs a piece at the same time) just to survive in this country. It’s not an easy life, but one that I have always been proud of. So with this, I have ingrained in me the trait of working really hard. However, with trading, I am seeing it as a huge flaw. Trading should remain simple and effective, not tedious or complex. You have to trade smarter, not harder. This is probably the biggest lesson for me. I have to “re-wire” my brain without letting go of the great lessons my parent taught me. In this, I guess everything has it’s place.

2. I rush things because I lack patience- Mojo teased me about my ROTC background back through high school and college. From this, when I am given a task/mission, I like to go all-in and start knocking things out (”Git ‘er done” mentality) This can also be a huge problem as with trading, you NEED patience or you will either lose interest or hope if you don’t make your first million in a year, or worse off- you’ll blow up your account through reckless trading! I rushed with trades before I had my most current trading rules established (for those of you that requested my rules, I did not forget, I am just hashing them out still with my trading partner)!

3. I over-complicate things- I am a VERY detail-oriented person while Mojo is a big-picture type of person, so we are trying to find a healthy balance in teaching trading and blogging. I had the understanding that most people that read this blog already know what calendars are, for example, so I didn’t explain things on a more basic level. For this I apologize if I confused anyone! :)

Ok so with my confessions today, I encourage anyone to give me feedback (you can send me a private message through Insane Money if you choose). This helps me to become a better trader, and helps you understand what I am talking about so you can become a better trader! Thanks for reading….Happy Trading!

-Gekko

THIS SITE IS UNDER CONSTRUCTION

Hello guys,

Since I branched over to live money trading as well as futures trading on top of options, I have been keeping track of all my trades and adjustments on a spreadsheet so it has been hard to post all my trades on this blog. I currently am trading for a few people I know so I am diligently working on those accounts and getting everything up and running. This site is temporarily under construction, but I will resume posting my trades after the new year.

This month is always the most difficult of the year to trade as volume decreases because of holidays and time off for traders. Also, we have had quite a bit of volatility as our future President Obama and his teams try everything to salvage this great nation. Trade very cautiously during this time if at all. There's nothing wrong with taking a few weeks off from it either.

I am currently in some diagonal trades on BAC, C, GE & SNE. I also have a wide spread iron condor on RUT with a long put and long call for protection.

If you are looking for a great site and a trade team, please check out www.insanemoney.com. My good friend Mojo started that blog over a year ago and it has grown into a community of traders all aspiring to trade full-time. Check it out and see what you think.

Merry Christmas & Happy New Year to all!

Stay tuned for future posts...

Welcome Back Gekko

Hello all- I haven't been posting my trades for the last month because of work craziness however I have been actively trading all month. We took a beating with energy stocks as they turned bearish on us and we had to adjust like crazy to stay delta neutral.

My biggest lesson this month is to take profits when I get them instead of leaving them on the table to "give away" to the market maker!

I had an I.C. on MEE for about a month that was doing very well, staying within my B/E ranges, but then on the second to the last day of expiration as it suddenly became close to max profit, I went to lunch for an hour and then the stock tanked on me. It was rough and I lost on the trade, however, I know now that I will never make that same mistake again. The famous song "The Gambler" by Kenny Rogers now rings in my head each time I think of this. I am learning how to "know when to hold them, know when to fold them."

Bottom line is: when you have trades on in the last week of expry, especially within the last 2 days, they need to be watched and nursed.

VACATION!

I will be travelling to ITALY for the next 2 weeks so I have closed out all of my trades and am "all cash" in my portfolio.

I did not have time to calculate all my closes for April, but will do so once I get back.

In the meantime, trade safely....these times are volatile in the markets so if your in high volatility trades now, you may want to consider tightening stops, or pulling out from your trades all together for a week or 2 until the market levels a little more (after that huge bullish spike on the DOW this week).

Happy trading!

Arrivederci!