Interesting Link

http://www.commondreams.org/
This is an interesting site,and the article I found most disturbing is the reduction of unemployment benefits,being reduced to 76 weeks from 99. how on earth can people survive with no money?
The stock markets are so disconnected from the economic world it is disturbing. Sure iPods are selling like hot cakes, but this really is illusory there is no recovery, just a thinning out of staff and bashing of the poor. Funny how the US has 5 times more crime pro rata than the UK, it might make sense to join the dots. Crime pays when you have nothing to lose.

New Take, Old Strategy

Just sat through another options video- I get a lot of trading emails for free and I am never dismissive of these guys,they often have a valid point. The latest one simply suggested an iron condor where reward = risk. So on a 50 point short spread,you will take in a total premium(both sides) of 25,thus the risk in worse case is 50(-25) = 25. Will have a look at what strikes and how far OTM this would require,but when markets are flat,or showing nice S&R, this looks a useful trade.

Flat Flatter Flattest

What a very strange market -cannot figure things out,and I guess no one else can either. So what will move the market? I think there may be some exogenous event,and I hope it's not a horrible one.
Latterly we have seen the horrors of brutal dictatorships,vile oppressive regimes, and fundamentalism.
The basket case countries are a stark reminder that our freedoms, envied by most of the world,come at a cost paid for by many generations.
We must invest in ourselves,and our security as bankers must invest in the society that feeds them.(Alpesh Patel inspired this evening on Jeff Randall's Sky programme 'What's a banker worth')

Keeping up to date

I'll try and post daily as it's a good discipline,but the only pearl of wisdom from today is: doing anything for 10,000 hours usually means you will get quite good at it-but there is no quantifiable period for luck.
However.
The harder you work the luckier you get.

Funny how......

Other traders seem so reluctant to be honest and share their trading results. the only honest source I found was from a company website of wealth managers. It makes grim reading


clearly a great many 'investors' are down about 30%- so the funds will have to make around 50% just to get back to par. Not good in a high inflation environment. I'd be furious that so-called professional fund managers behave like premier league footballers-probably worth £500 a week,but somehow the rewards seem to be in the stratosphere,and..... for terrible performance

How to Position

Should one position for a move up or down? Or should we be market neutral and position for NO move? I had genuine concerns this month and was not prepared to take risk either way but positioned for a drop, with the expectation of being wrong and making a modest loss. At times like these the loonies in charge of the cash are liable to step in and make a mockery of free markets, so it's hard to make money. I don't think I should beat myself up just yet,but if we get to July and I haven't made some serious coin........

Greece

I am concerned that the Greek people may force the hands of the politicians,and boycott any plans for further austerity.
All in all I am amazed that anyone is still trading with clowns like B of E throwing £50 billion into the ring, to counteract the other forces,such as the impending collapse of the PIIGS- funny how everyone has gone so quiet there- yet ALL of Italy's banks were downgraded by S&P
http://uk.reuters.com/article/2012/02/11/uk-italy-banks-idUKTRE8191QJ20120211
Are we to think that the others-Portugal,Ireland and Spain are all top drawer institutions?
We need to take the hit, like adults, and move on.
The big economic powers have shown that we can work in concert- G20 etc,so it's time to act like adults. Admit the errors,accept the downturn is not going away ( recession has been the actuality for the US since 2003) and tighten our belts for a few years.
Growth is illusory when debt outweighs income

Proper info

http://www.yolohub.com/economy/what-is-the-truth-behind-the-new-jobs-numbers
Hope the link works and that what it says is accurate.
Of course the job numbers are massaged-and claiming winter workers are counted as not working due to 'weather' so making adjustments up is just plain disgusting old fashioned lies.
I don't care what the number is but really-isn't it time these guys grew up? One day we are all called to account,and I don't think mortgaging the grand childrens future is a nice thing to do.
It's not a recovery when covert QE is going on either.

Still trading

I wonder how many of the folk I used to know are still trading. It's not for most people as we know but like anything worthwhile unless you stick at it, you won't succeed.
I have a book somewhere written by a guy who made no money for the first 17 years of trading- I'm still learning after 11 years.

Those Jobs

Don't know why I get angry but even John Mauldin is bemused by Non Farm Payrolls and the way the market tends to over-react. Perhaps it's a smokescreen for the plunge protection team?

When you're wrong

Van Tharp makes the most profound statement about trading" We trade our BELIEFS about the market".
That is a great comfort when we are wrong,as I am currently.
I may have a modest loss,but I believed the market was ripe for a correction-it now has to fall 2% further to make me a happier bunny.
It's not easy for options traders to make money in a low volatility environment, from my experience it's cheap to trade, but you need to be directional-ie to have a ball park figure for the market. I will look to take something out of the call side and morph my long put spread so I can take in some premium safely.
As for beliefs about the economy- you don't have to travel far to see that things are really not good-but the economy is not the stock market.

Non Farms

It's all about this ridiculous number which everyone knows is a crock-you have to feel for the tens of millions in the US who have no homes, jobs or prospects it must hurt to see these clowns claim the economy is improving,when all that is happening is more money is being printed

Calm Trading

A while ago I met an options trader through a very curious quasi mystical group who were into other worldly things. This trader was offering his services too but after chats with him, I figured I was doing ok. He went through a rough patch with trading,and we drifted apart,but he had a website about CALM trading-and that is something I have always tried to achieve,and I think I am getting there.
so why should trading NOT be calm?
start here:
1. poor preparation
2. No exit strategy
3. No clear entry strategy
4. No money management
5. No understanding of risk
6. Failing to do a 'what if' scenario.
7.Trying to trade news(which is too old to be of use by the time you get it)
Gambling is doing any/all of the above and is for thrill seekers.
Traders are seeking to make money from the markets,for thrills I like cycling no hands with my eyes closed(not on main roads). I get a buzz out of my other life too-which is about helping people,the key to a happy life so it is said.
We are all of us guilty of impulse/revenge trading and sometimes we have a tiny influence on the market,but that is not why we trade. emotions are for the other parts of our life and an emotional response is usually the worst response to the risk, unless you are on fire or fleeing from an enraged tiger.
I get a lot from mentoring,and hope to establish one day a small group who make money and live a stress free trading life.