My First Trading System is Ready for Live Trading

May 7, 2014 I had a coaching call with my trading coach while I was in Austin. He asked a lot of questions about my backtest results and tried to find problems with it. He declared that it looks like a good one and I can start trading it. I was surprised and didn’t feel ready. It implements a short-term long strategy. That sounds weird, doesn’t it? By “long,” I mean that I’ll be buying stocks rather than selling (or shorting) them. And by “short-term,” I mean that the positions will only be open for about 5 days. When my … Continue reading

Trading Wisdom from Tony Saliba

December 18, 2013 On October 19 of 1987, you may or may not recall that there was a market crash. It is referred to as “Black Monday.” Tony Saliba did very well during that crash. That’s why I feel it’s important to understand his style and beliefs in order to weather any crashes or collapses that lie in our future. He started his trading career in 1979 at the Chicago Board of Options Exchange (CBOE). Here are some of his beliefs from a chapter in “Market Wizards:” 1. You have to be disciplined and you have to do your homework. The … Continue reading

Sophia’s Metamorphosis into a Trader

I am progressing in my work to design my own trading system. I just read another book called “Short Term Trading Strategies That Work.”  What I really liked about it was that the author shared the results of lots of tests he has done with a handful of different entry signal ideas. He shows that many things we believe to be logical as far as how to make profits trading are completely wrong. You’ve got to think outside the box to come up with ideas that have an “edge.” I think it’s so exciting to be able to test your … Continue reading

Trading Wisdom from Ray Dalio

  He believes there are 4 economic conditions: Growth increasing, Growth decreasing, Inflation increasing, and Inflation decreasing. His funds’ strategy is to balance the portfolio with investments that do well in each of the above four environments. In contrast, most conventional portfolios substantially overweight assets that do well in the first category, leading to unbalanced portfolios that can do poorly in other types of environments. The concept that mistakes are the path to progress is one of the pillars of Dalio’s life philosophy. Mistakes are good if they result in learning. He has created a culture in which it is … Continue reading

Trader Wisdom from Linda Bradford Raschke and Richard Dennis

Trader Wisdom from Linda Bradford Raschke I took a lot of notes while I was reading the Market Wizards books. This was required to help me understand what type of system I should develop in order to trade profitably. I’m going to be sharing a lot of these notes with you over the coming weeks and months. These are concepts that I liked that were shared by the traders interviewed in these books. Here are the concepts I liked from the Linda Bradford Raschke interview. She was the only female trader interviewed in the three books I read: Formal education didn’t … Continue reading