First Significant Loss – $(1,426), 50% of Account

$(1,426) realized loss on DARE (before reverse stock split, CERU)

  1. Entry: BOT 2000 Shares @ 1.14 average fill price
  2. 10:1 Reverse Stock Split (CERU -> DARE)
  3. Exit: SLD 200 Shares @ 4.29 average fill price

Account size halved from ~$3,000 to ~$1,500.

CERU_7_26_17_chartsDARE_7_26_17_chart

High Level: Dragged out, hope filled disappointment.  The silver lining is that this is an experience I can learn from and the loss is bearable, I’m only trading with what I can lose – with what I can psychologically handle.

Strategy: Initially, buy the breakout on good news and exit at target.  What actually happened: Hold, hope, hold the bags & suffer till you can’t take it anymore.  From what I’ve read … classic new trader behavior.

Exit description: I sold my 200 shares of DARE earlier this morning because I finally realized how ridiculous my reasons were for holding.  From the very beginning I was stubborn and wanted to be right instead of seeing what was in front of me, a clear pump and dump that I should have left at first sign of declining volume and flattening price action.  I was greedy.  I didn’t want to realize a loss at $200, but my total loss could be $200 and not $1,500.  On the flip side, I am thankful that this was a $1,500 loss, not $15,000 or $150,000.  This is tuition, this is education, I need these losses to learn what not to do.

A few more takeaways from this trade:

  1. Don’t bet on a comeback from a conference call
  2. Don’t bet on a comeback after a reverse stock split, ESPECIALLY when the firm in question received notice from the NASDAQ about keeping their stock above $1
  3. Don’t fall for confirmation bias more than once, I found myself searching the web / news / stocktwits / seeking alpha / etc. looking for something to confirm that this stock was going to make a come back and that I would be rewarded for holding and hoping.  I was looking for Ovaprene (flagship drug that DARE is developing) to be a game changer, but their game plan is far out, two years – not now.
  4. Don’t fall for wanting to be right over making money.  I was wrong, I should have cut my losses as soon as my mental stop was hit.
  5. Respect your max loss for each trade.  Focus on minimizing the downside, the upside will take care of itself.  Instead of focusing on the amount of money you can make from a trade, focus on what is the MOST you can risk losing.
  6. Trading without a system, is asking for disaster.  Focus on three things:
    • Trading Methodology
    • Money Management Technique
    • Best Markets for Setup

Rule #1: Never Lose Money

Rule #2: Never forget Rule #1

– Warren Buffet

Interactive Brokers PDT Notation – 6/29/17

You can find this information @ Account > Funds tab in the IB TWS mobile app.

FYI – for anyone else out there who is confused by Interactive Broker’s day trades left notation, the numbers represent number of day trades left from a T+0 to T+4 basis.

E.g. – if today is Thursday 6/29/17

(0, 0, 0, 1, 3)

  • T+0, Thursday –  0 day trades available
  • T+1, Friday – 0 day trades available
  • T+2, Monday – 0 day trades available
  • T+3, Tuesday – 1 day trade available
  • T+4, Wednesday – 3 day trades available given no trades took place on T+3

Trade #1 – $FOLD 6/20/17

  • Entry: 10.15
  • Size: 100 shares
  • Stop 9.15
  • Target 12
  • Risk / Reward: 1 to 1.85
  • Strategy: Multi-day breakout
  • Source: Turbobob profitly 6/20/17 watchlist. Price Action, Analyst upgrade to Buy by bidaskclub
  • Plan: If can break 6/19 HOD (10.15) then target of 12
  • Note: Human error, looks like I put in a MKT order instead of LMT, average fill price of 9.99

First trade with IB today. Used 33% of account, probably wasn’t a good idea to start with such large position sizing. Minimum commission is $1, 200 shares @ $0.005/share to optimize commission spending.

Respect your risk. Sit tight. Will deposit another $2,000.

FOLD1

7:50 AM tested yesterday’s HOD resistance, failed

Question: is 7:40 price action a result of 10.15 shorts covering or is it from bullish buying pressure? Or is it both?

FOLD2

7:58 AM uptrend, testing 10.075

FOLD3

Jesus, that 8:00 AM candle, drop from 10.06 to 9.9

8:05 AM Glued to the screen on my morning commute. Mistake

8:14 AM thought … look at sector, industry, capitalization performance YTD. Top down?

FOLD4

12:17 PM touched prior HOD then faded. Fuck. Touched 200 SMA and we’re dipping. Do I close my position, hold or buy more?

FOLD5

7:19 PM Faded and closed @ 9.55

Closing thoughts:

  • Potential morning panic tomorrow?
  • Other traders locking in profits or buying to push higher?
  • First red day?

8:01 PM I need to improve my knowledge of trading. I feel like I’m going in blind.

Current unrealized loss of $(44). First loser in the books.

Watching Timothy Sykes HTMM.

Interactive Brokers Account Approved!

Perfect.

Screen Shot 2017-06-02 at 12.34.17 PM

IB Login

A few successful traders I have been researching (Timothy Sykes, Tim Grattani, Michael Goode, Michael Croock & Steven Dux) all have favorable things to say about IB as a broker.

Tim S’s 2017 started with $800,000 at IB, $200,000 at a HNW broker, and some change at E-trade. Dux started his trading career at IB based on his profit.ly trades. Michael Goode puts the majority of his trades through IB. Therefore, I’m good with starting out with IB.

  • Interactive Brokers has a lower account minimum for account holders 25 and under, $3,000 vs $10,000. I’m planning to start with $5,000.
  • Caveat: they enforce the PDT rule for accounts under $25,000 and I believe the $2.50 rule is in effect as well.

Market hours on the West Coast are 6:30 AM to 1:00 PM.

Plan is to get up at 5:30 AM and get prepped to trade at the open until 7:00 AM then head to the office. I get back from the office between 7:30 PM and 9:00 PM. Before sleeping, focus on creating a watchlist of volatile, liquid potentials and update a spreadsheet of potential plays with entry thoughts, exit thoughts, strategy you are focusing on, risk reward, support / resistance levels.

Tim S has a traderchecklist.com set of videos that I plan on checking out. I have considered using John F Carter’s “Mastering The Trade” checklist, but want to get some perspective from Tim S as well. In the works.

The night before is extremely important, as this is when I’ll get the majority of my preparation done for the battle in the morning.

I will focus on trading perfect set ups. PDT is a blessing – it makes you have to be picky. You can’t fucking trade anything and everything. You’ll get eaten alive.

First, I will need to know what a perfect set up is.

I’ll learn this through recorded live trading sessions and focusing on:

  • the initial reason / strategy for taking trades (watchlist creation)
  • entry point analysis (what am I risking? what am I gaining?)
  • managing the trade while in via L2 / sales time tape / price action / resistance / support
    • does the bid look stacked?
    • ask stacked?
    • is there fake size?
    • where are the whole numbers you gotta watch out for?
    • are there big hard stops stacked up somewhere?
    • where do you think it is going to crack / break out?
    • are you getting out because of fear? are you staying in because of greed?
    • stick to your plan, if you deviate, make sure it’s noted why and how to avoid it again
    • buy into weakness, sell into strength
    • don’t chase like a little bitch
  • exit point analysis
    • did you follow the plan?
    • was your set up proven correct?
    • record your trades in a spreadsheet, test 1 – 2 setups at first and trade them equally to see where you statistically perform better. Think A/B testing.

Cool, now all I have to do is go bomb this CFA Level 1 Exam at 9 AM tomorrow. Wish me luck…

Let’s get it

$1,000,000 before 30

My goal is to achieve a net worth of 1,000,000 before turning 30.

As of 5/14/17

  • Age: 25
  • Net Worth: 30,000

What are some reasons why?

  • Gain the skills necessary to be self sufficient
  • Live life on my own terms
  • Provide for the ones I love
  • Travel the world
  • Transition from a linear to exponential return on time

Without supplemental income on top of my current salary, I will not reach 1 million in the remaining 1607 days.

What have you tried to supplement income?

  • Cryptocurrency (Doge, Aurora & Bitcoin) Buy and Sell (2014)
    • Flat
  • Amazon FBA retail arbitrage (August 2016 – November 2016)
    • Revenue: 3,400
    • Expenses: (4,200)
  • Ticket Scalping (January 2016 to March 2017)
    • Revenue: 3,200
    • Expenses: (3,300) – unfortunately scammed on an $800 sale
  • Index Futures Day Trading (January 2017 – Present)
    • Starting paper account balance: $100,000
    • Current paper account balance: $151,000

Trading has worked for me so far, I have lost money or held flat on my other endeavors.

I have read through John F. Carter’s “Mastering the Trade” and am working through John J. Murphy’s technical analysis bible, “Technical Analysis of the Financial Markets”.

I am currently working through Tim Grittani’s Trading Tickers videos to further my education on actively trading a wider range of securities daily.

 

 

Fresh Start

It’s been a while. My last post was over two years ago.

Screen Shot 2016-07-30 at 5.10.31 PM.png

(Hiked Alamere Falls last weekend! Great hike, highly recommended if you’re in the area.)

A short recap on the past two years.

  • I didn’t get a full time offer after my previous internship (executive compensation tech firm – blessing in disguise, I would have hated my job).
  • A few months after, I started at a healthcare consulting firm as an associate consultant.
  • A little under two years later, I’m not happy with what I’m doing, not performing to the peak of my ability/potential, and most importantly – I’m not learning.
  • I’m leaving the company next month, currently figuring out my next step.

This article in NY Times upshot really had me thinking about that next step.

The happiness literature has identified one of the most deeply satisfying human psychological states to be one called “flow.” It occurs when you are so immersed in an activity that you lose track of the passage of time. If you can land a job that enables you to experience substantial periods of flow, you will be among the most fortunate people on the planet. What’s more, as the years pass, you will almost surely develop deep expertise at whatever it is you’ve been doing.

Since graduating university, I have found “flow” when buying and selling cryptocurrency with Dogecoin and performing a variant of arbitrage on EVE to increase my net worth in ISK.

The things that drew me were:

  • trading
  • finding and executing deals
  • understanding financial topics
  • performing research to back my decisions, and being rewarded monetarily for my actions.

I’m posting again because I’m sick of passively digesting articles, staring at a screen thinking I’m learning. That’s not active learning. I want things to stick. I want to internalize what I’m reading/learning.