Posted in PSYCHOLOGY of trading on 06/10/2008 11:58 pm by idkit
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Trading Success: Ray Barros is a coach and experienced trader who offers plenty of resources for traders to mentor themsleves.
Twitter Trader: My Twitter service that posts to the TraderFeed blog (or to you directly if you subscribe; it’s free), highlighting trading themes, news, and updated market indicators.
If you know of free or commercial services that are unusually helpful in aiding traders’ growth and development, feel free to post in the comments section. I have found the above resources to be especially fertile sources of inspirations and insights.
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edge
Posted in Market Commentary on 06/10/2008 10:58 am by idkit
michael-masters-written-testimony
This excerpt of a Testimony by Michael W Masters before the US Senate has been submitted by NicT of HK which I reproduce hereunder:
What we are experiencing is a demand shock coming from a new category of participant in the commodities futures markets: Institutional Investors. Specifically, these are Corporate and Government Pension Funds, Sovereign Wealth Funds, University Endowments and other Institutional Investors. Collectively, these investors now account on average for a larger share of outstanding commodities futures contracts than any other market participant.
These parties, who I call Index Speculators, allocate a portion of their portfolios to “investments” in the commodities futures market, and behave very differently from the traditional speculators that have always existed in this marketplace. I refer to them as “Index” Speculators because of their investing strategy: they distribute their allocation of dollars across the 25 key commodities futures according to the popular indices – the Standard & Poors – Goldman Sachs Commodity Index and the Dow Jones – AIG Commodity Index.
Please read more at link at the top of page.
It is educational for readers/traders to understand why commodity prices keep rising in spite of ample supply.
Here is a bonus to go with the abovementioned article - NUGGET OF TRADING WISDOM: 2% Rule
The 2 % rule is a basic tenet of “risk management” or “capital preservation” as they are more descriptive than “money management”.
Larry Hite, in Jack Schwager’s Market Wizards (1989), mentions two lessons :
- Never bet your lifestyle ie never risk a large chunk of your capital on a single trade.
- Always know what the worst possible outcome is.
Hite goes on to describe his 1 % rule which he applies to a wide range of markets. This has since been adapted by short-term equity traders as the 2% rule:
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The 2 Percent Rule: Never risk more than 2 percent of your capital on any one stock.
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This means that a drawdown of 10 consecutive losses would only consume 20% of your capital.
index_speculators
Belated congratulations for this new weblog that I just discovered.
Becoming a trader for me means expanding my horizon to read write and learn .
In this way, when you write and share you also find an edge over those who don’t.
Look forward to your new book and to seeing you in Singapore soon?
June 10, 2008 9:27 AM