I have decided I am at the point in my learning where it’s time to just jump in and do it. While I believe in always learning and educating yourself, without taking action all the knowledge in the world will not help you. You’ll eventually need to take what you learned, start using so you fully understand it and by doing so you’ll find more questions and be able to seek out the answers. I feel this is most beneficial after getting a good base knowledge of trading. Luckily for those of us that are interested in trading, they have paper trading. For those with smaller account or just not quite confident enough in a system to trade it doesn’t get any better.
I won’t take the time to explain paper trading in detail, because I assume most people reading this blog know what it is already. However, for anyone who might not know it is a real life trade simulation. You use the same market as you do with real trading, but you trade with fake or paper money. Some traders are strictly against this and some say it is just a part of the road to being a successful trader. My personal opinion is that paper trading is essential for beginners and may even be a good idea for experienced traders.
My only real reason for experienced traders is that you might as well back-test a new strategy using paper trading than risk capital. When studying the market and trading in particular you will be drilled on the fact that risk management is the key to being a profitable trader. I think a lot of experienced traders get over confident and just throw money at trades to test a new strategy. The truth is most will probably be able to do this and make money or minimize losses, but again why risk money? Trading can be extremely psychological and with paper trading you take that factor out of the game until you know your system works. While I don’t think it’s necessary for experienced traders, it may be a good idea.
Next I want to go over a few points for those whom that I feel really need paper trading…
Read more…
For the past month I have literally been reading everything I can find on day trading and stocks in general. I have read numerous books now, many blogs and followed a few charts along the way. The only problem with this long period of learning without actually practicing is that I fear I will forget the information. So it has now become routine to also review every so often. I look over all my notes, re-read blog posts, skim over books again and make sure it’s all sticking.
The good news is that while reviewing it is all still making sense and I feel like I know everything that I am looking over again. I recommend anyone to do this whether they are still soaking up information or have already started into their trade. It really gives you a confidence boost in what you are doing or are about to do.
With that said I am nearing the end of my initial learning process. I will never stop learning, but for now I feel I need to move on to actually putting my knowledge to practice. Currently I am waiting on my copy of Brian Shannon’s “Technical Analysis in Multiple Time Frames” which will be my final book before I start my actual trading. My hope is that I get the book in the mail tomorrow and jump into it immediately more than likely reading a good portion of it that night. I have heard amazing things about this book and I really like Brian’s trading style based on following his website. He takes a very realistic, straight forward, common sense approach to trading.
So I have created some rules I want to trade by, established what indicators I will be using, mapped out loose entry and exit strategies, have basic risk management under control I am ready to trade. The only thing left is to read my last book, incorporate those concepts into my plan and decide if I want to paper trade or jump right into the money. Either way I will use the next two days and the weekend as a final preparation and then next week I will be taking the plunge. Can’t wait!
Happy trading,
Keith
I am back in Iowa and finally rested up. I left early Friday morning and returned late Sunday night and it was a great trip. One thing I have to complain about is travelling alone, because it simply sucks. I am new to travelling period, so doing it alone is kind of stressful and tiring. I made it though with no problems.
I didn’t document the trip like I wanted, but did take a few pictures. I was too busy and didn’t even think about updating Twitter or the blog.
I’ll make a new post tonight about what I am doing, some goals and information on my trip.
I’ll be headed to Michigan this weekend so look for a few personal posts coming your way. Go ahead and follow me on Twitter by @Keither for good measure too. I’ll more than likely be sending updates and pictures there since this is the most exciting thing I’ve done in a while now.
Friday night I will be going to the Pistons vs Clippers game sitting just left of center court and about 13 rows back. I wanted to spend the extra money and get in the VIP section, but my girlfriend wasn’t having any of it. We did get a good deal on some pretty decent seats though and it should be a blast. I live in Iowa and we don’t have any professional teams, so this will be my first big sports event.
Saturday I will be heading to Detroit and checking out Hitsville USA, the Joe Louis memorial and eat at the Hard Rock Cafe. Another first for me as Iowa doesn’t have a Hard Rock Cafe and I haven’t been any place that does have them. So that should be very cool. I am also a life long boxing fan and looking forward to see the Joe Louis memorial. Lastly my parents always listened to oldies, so I pretty much grew up on it. I am mainly going to Hitsville USA to grab them some souvenirs and pictures (if they allow pictures), but I actually know a lot about it and am a history buff so it should be fun too. We may also check out the Detroit Institute of Art which I’ve been to twice now and it is amazing. I’m not a big art guy, but this place is great from the building itself to the art.
Not sure what’s going on Sunday. Maybe a movie or just hanging out. I’ll kee it updated here just for fun. I’ll be back Sunday night and ready to jump back into work.
My goal is to really hit the day trading thing hard starting Monday. I will be studying some charts Sunday night and jmping in paper trading Monday. Followed by real time trading soon after. Can’t wait!
I was reading an article on Yahoo Tech News today about a new technology produced by MIT that will create lithium batteries that can be charged in seconds. The battery will also be lighter and smaller than today’s standard batteries which is the trend with all new things. As of right now it has been developed for small devices like MP3 players and cell phones, but noted that it could be used in other devices such as car batteries.
I have the iPhone and one of the main downfalls of it is if you use it a lot for talking and web, email etc is that the battery does not last long. Currently I barely make it through the day with my iPhone battery and need to charge it when I get home. The problem is that I hate waiting and I usually need to leave and it doesn’t get charged all the way. So this will be huge for me and other iPhone users.
The next thing that really caught my eye is just the technology itself. If they are able to scale this up into bigger products it could mean HUGE things for cars and the oil problem. It seems that everyone has forgotten about the oil issue now that prices have receded, but that doesn’t mean it’s over. Given the technology can hold a big enough charge AND be recharged in seconds this would take a lot of the problems of current electric cars out of the equation. Over the years I have been against electric cars, but if I could have a car that would allow me to go decent speeds and then some and hold a charge to to where I can actually go somewhere I’d be welcoming to the idea.
Can’t wait to see where this goes. Check out the article here:
MIT Invents New Quick Charging Lithium Battery