Trading Journal - Your Trading Pillar for Success

If you are trader (whatever it is - stock/options/future/forex) and never had your trading journal started, this is my genuine advice - Start it now !!! And do not wait !!! 

Trading journal is one of the upmost criteria for a successful trader, of course, it is equally important for all the beginer trader. But from the start, you will be definitely facing discipline issue as recording down every single trade is not an easy task for every one, especially for a person that is not very well organized for his stuff.

But once you started it, you will start to see more results, it is just a like a journal, to understand yourself better. A trading journal will let you understand yourself more about your trading style and behaviour.  

Then why do we need to have trading journal? The reasons are simple:

1. First, it gave you more time to think before you enter your trade while you still entering data in your trading journal before entering the market. Many times, you realised that your trade is based on emotion more than analysis. Give yourself a valid reason why you enter the trade, and what is your exit strategy. 

2. Second, it provide reference information when you trace back why did you enter the trade in the first place. Whether the result is making profit or loss, your record is important for you to know what you did right and what you did wrong. 

3. Lastly, to calculate the profit/loss in a systematic way, as well as providing a performance chart for yourself to track your profit/loss, as well as your winning/lossing trade ratio, etc. 

If you are excel expert, you can make a simple trading journal by using excel.  If you are not, and would like to use what the expert promote - here is one for you. 

My friend Grag has introduced a trading log sheet to me which I find it very useful and comprehensive. 

You can find out more from here - http://tradingspreadsheets.com/

For all Stocks / ETF, E-mini Futures, and Forex (Fx) Currency Pair traders!

   Plan it... Trade it... Track it !!!.

 A glance at the "Spread`Suite's" 8-different sheets

This trading spreadsheet is basically created with excel, with all the necessary information to guide you how to use it. Like all the software you use, first thing first is to familiar with product you are going to use.

You want the excel do the rest of the calculation after you key in the necessary data, this is one for you. It allows you to record your "entry note" and "exit note" in the comment column, because the reason you enter and exit the trade is upmost important, it let you understand your trading behaviour bettter. 

It provides your performance chart based on your monthly profit/loss, and most importantly you can now track every single trade you entered. 

I would say it is basically a comprehensive trading journal package whatever you need to analysis your trading performance. 

To your successful ! Cheers ! Find out more about trading from http://www.traderwork.com/ 

Trading Journal - Your Trading Pillar for Success

http://www.traderwork.com/ - Reveal the Secrets of Options Trading !

If You are looking for free Options Trading Resources adn tips, this site is for you.

Present to you, TraderWork.com http://www.traderwork.com/.

I would love to share more information about options trading, tips, articles as well as my trading journal.

It is a wordpress theme with 3 column, 2 sidebar at the right with easier browsing other information I would to promote.

You can easily find the recent post, category and tag cloud at the right, or simply using the search box.
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Trading is an art, as well as building a website. I hope you like the new appearance.

Free free to stop by and give me some comments, both positive and negative, I welcome that!

http://www.traderwork.com/ - Reveal the Secrets of Options Trading !

Investing in bank stocks

by A.W. Berry

In the United States, during the 1990's several federally implemented acts contributed to banking deregulation that had begun the previous decade. These Acts essentially gave banks the ability to operate with more freedom and with greater commercial horizons. The new laws allowed banks to operate more freely from state to state and to engage in other banking functions. The result became banks that could provide a multitude of services.

Key U.S. Banking Institutions:

A few major U.S. banks are listed below for illustrative purposes. These are just a few of many U.S. banks, several of which play important roles in various aspects of economics and banking services.

Bank of America (BAC): Bank of America is a very large commercial bank that deals with day to day bank services on a world-wide scale across the United States. This company is a large capitalization bank with share value of 223 Billion dollars and offers a wide array of consumer and commercial banking products. 

Meryl Lynch (MER): Meryl Lynch is another large bank that operates primarily in the investment banking sector of the U.S. economy and globally. This bank has a market capitalization of near 61.5 Billion dollars, and its major products and services include brokerage, institutional investing, and financial advising services along with several related banking products and services. 

Countrywide Financial Corporation (CFC): Countrywide Financial is yet another very large bank that deals primarily with mortgage lending within the United States. Its market capitalization is near 11 Billion dollars and in 2007 its share prices fell dramatically due to financial turbulence caused by factors relating to a weak housing market.

Benefits of Investing in Banking Stocks:

Banking stocks are a unique to the type of services and products they offer. While the stocks may fluctuate significantly in value over the short run, many large and stable banks offer the potential to grow steadily over longer term horizons. A few of the functions that can lead to a banks asset and profit growth are listed below.

*Mergers and Acquisitions: Banks that facilitate, finance and engage in a high volume of corporate mergers and acquisitions have the potential to yield an increase in profit margin due to the increase in return on assets associated with these banking activities.

*Initial Public Offerings: When companies increase in size or become public, they often seek additional financing for expanded operations and project implementation. Banks that facilitate these activities well can benefit from them.

*Credit Services: Banks that engage in credit services have the potential to earn substantial profits dependent on the creditworthiness of their clients and interest rates they are able to charge.

Risks of Investing in Banking Stocks:

*Sector Downturns: In the case of the aforementioned banks, an economic downturn in any one of the markets these banks deal in could cause a lot of volatility in the share prices of those companies. As we have seen, the downturn in the United States housing market led to stock volatility in shares of Countrywide Financial Corporation.

*Economic adversity: If an economy turns sour, the banks may be the first to feel it as consumers, corporations and institutions run to banks to liquefy their assets, default on loans and redeem their funds. These factors and changes in currency valuation, federal banking policy and profitability can be another risk of investing an banking stocks.

Key Metrics of Banking Institutions:

Since there are many types of banks engaging in a variety of services choosing the right financial metrics to assess these companies can be tricky. Nevertheless, the two following measurements indicate a banks essential capital and operational stability.

*Capital Reserve: The amount of unused liquid assets a bank maintains on its balance sheet is an indicator of solvency. Capital reserve amounts in excess of 10% are considered sufficient by U.S. regulatory agencies. An example formula for assessing capital reserve is the capital adequacy ratio (CAR) which divides capital by assets such as loans which are weighted for risk.

*Daily Value at Risk (VAR): A VAR calculation can be used to determine the risk level of its investments and/or banking products using a multiplier for precaution. An example of this calculation takes the potential dollar value loss within a specific time period using the worst 10% of investment assets multiplied by 4. If over 365 days, a bank's worst 10% of loans cost them $20,000.00. Multiplied by four, and divided by 365, their daily value at risk would be $80,000.00//365 or $219.18 of risk per day or $80,000.00/year. Naturally, the higher this value is in comparison to other banks, the greater the measured risk of the banks investments.

Learn more about this author, A.W. Berry.

Investing in bank stocks

How to Invest During a Recession by Jaime Reina

America is spiraling downward into a recession. Some say we are in the recession now, but that is a matter of opinion really. So what are we supposed to do during this economic downturn. Many of us invest for a living and need to find good opportunities for investing to continue making an income. Luckily, in every situation, there is always a method of investing that is both safe and profitable. It just so happens to be in my area of expertize, penny stocks.

Why penny stocks? You see, during this recession, you are going to see tons of really big companies do really bad. The little companies on the other hand are still under the radar and will not suffer as badly because of our economic situation. In fact, many of them will gain a ton of momentum because of it! Because of my involvement with penny stocks, I have been able to keep investing with little worry of failure. You will not see me turning in dozens of applications during this recession.

So how do I do it? There a couple little tricks I use to find penny stocks that are still safe investments. The first of which is trend investing. I simply look at a stock prices history and identify a trend. A trend is any repeating pattern in the stock price that you can use to predict the price's future. If the trend is unaffected by the recent stock market problems, it is a safe investment. It is just a little method I have developed recently and it has been working wonders!

The second thing I look at is actual trade volume. If a stock maintains it's trade volume, even through all of this mess, it will make a good investment. So you see, you can still invest during a recession. You just have to change it up a little.

It is during times like this that resourceful people who take the time to adapt to there situation make the really big bucks that can be made in investing. Sure, anyone can make a few bucks when times are good, but now is when we will see who is going to be the next big investor that everyone looks up to!

If you need more help or want more advice, you can find one of my favorite tools I use all the time to invest in penny stocks here: Doubling Stocks. I use this tool in just about every investment I make and highly recommend it. Thank you for reading and good luck investing!

for more information visit to:

http://www.squidoo.com/doublingstock

How to Invest During a Recession by Jaime Reina

Trading Rule Part 2 - Set the Difference Between Novice and Professional Trader

From the previous article, I mentioned 4 trading rules, no 1 – Always do market research, no 2 – Limit your trading size, no 3 – Give your trade a reason, no 4 – Set exit level.

Please refer to here to find out more.  

In part 2, I would like to share certain rules that I follow after I have entered the trade.

Rule 5 - Never average out a losing position

If you are having a losing position, try to minimize the loss by cutting the number of position, never add on to it so that you average out each options price. Many people think that they can salvage the trade by adding on to average out each unit price, this is self deceiving, and you might end up doubling your loss easily. Do not hold on to the losing position, you can either cut the position size or accept the failure, move on to another trade quickly.

Rule 6 - Always update yourself with the Economy Calendar

Financial market is always influenced by the economic event, for example, jobless claim, FED meeting, oil inventory, housing start, and etc. These are the regular report that will affect the overall financial market, therefore affects your decision of when to enter and exit the trade as well.

Rule 7 – Always updates yourself with the Stock News

After checking the broad economy view, now zoom into your stock news. You need to understand how the industry and the sector are performing at this moment. After that find out the latest news of the particular stock you trade, in order to understand if it is the best or worst performer in this sector. Keep yourself update with the company news, certain decision from the CEO or board of director definitely will affect the stock performance. 

Rule 8 – Always do analysis after market close

In previous article, I mentioned that we always need to do market research before market open. Now I would like to stress the importance of your stock analysis after market close. The market determine its price only when it close, this is the price that every buyer and seller agree after the war of tug. I usually like to use candlestick chart pattern to confirm if tomorrow I would enter the trade or exit the trade, because you only see the chart pattern after the market close. For example, how can you confirm that today is going to form a bullish engulfing pattern? You know it only when the stock rise up and exceed the open price of yesterday session until the end of the day. Therefore, you can have a better gauge after market close.

For part 3, please find out from TraderWork.com. Always trade with your passion! 

Trading Rule Part 2 - Set the Difference Between Novice and Professional Trader

Trading Rule Part 1- set the difference between novice and professional trader by Paul Liew

If you ask me what is the major difference between a novice and a professional trader, the difference is whether he or she set the trading rules and follow the rules. There are thousands set of trading rules that you can create or follow, what I recommend is that you do not need to create a certain of trading rules, you can just follow them which came from the famous investor and traders.

One of the famous investor that I admire and respect a lot is Warren Buffet. In his world, rules are more important than anything. His famous quote is as follow: Rule 1: never lose money Rule 2: never forget rule no 1 Funny enough? Many people understand the importance of setting rules but never learn to follow the rules.

For part 1, I would like to share the rules that I follow before I enter the market.

Rule 1 - Always do market research before market open: 
Open your CNBC or any finance website to get the latest update, understand what's happening in the market right now. Either is it oil price drop, or some where having a war, focus on news that may be making any impact to the US market and the stock you are trading. After learning the news, try to figure out the market sentiment, for example, is oil inventory going lower a good thing to the market? Certainly not! With the latest news in hand, it will help you to make a better decision when entering the trade.

Rule 2 - Limit your trading size: 
Do not over trade, always make sure you have enough money to play for the next game. Thumb of rule is always using 1/20 of your total money for each trade. If you have $5000, each trade is $250, in that case you can have 20 games to play.

Rule 3 - Give your trade a reason: 
Before entering the position, make a note and jot down what makes you buy or sell certain options, as well as what strategy you use, and why? Put all this down in your trading journal, so that you can revise it back. If you end up a loss, make sure you understand where the problem is. If you earn a profit, remember what you did right.

Rule 4 - Set exit level: 
When you see a potential trade, holds your trigger, make sure you set your exit level before clicking the button. Many people are good traders, they know when to enter the trade, but do not know when to get out. You need to set two exits, one for your stop loss, one for your profit limit. Especially for stop loss, set at the level that you are comfortable with your risk level, from the technical point of view, you can set your stop loss at certain support level, when the stock break through the next support level, cut the loss and run.

For part 2, please find out from Options Trading Academy. Always trade with your passion!

About the Author

I am an options trader and internet marketer, I have experienced the up and down through this valuable journey. Now I am here to share my humble experience so that you can be benefited from it. You can find out more free resources from http://optionstradingacademy.blogspot.com/ andhttp://internetmarketerjournal.blogspot.com/.

Find out how you can create wealth in Forex by 10 mins a Day!


GRAB A FREE REPORT HERE !! How to make more money, working less time, day trading. 20 pages of hot insider trading advice.Click Here!

Trading Rule Part 1- set the difference between novice and professional trader by Paul Liew

Trading News: Is It Worth It?

Whether or not trading news is profitable, only time will tell for each trader, but one clear advice from this is NOT to hold a stock before earnings. By holding through the earnings, it’s a guessing game. If he still likes the stock, by it back a few days after the earnings. Who knows it might have been oversold and now it’s a “bargain.” Of course there will be regrets if the stock does move in the desired direction.

Every morning just before the opening bell ring, every trader gets their buy or sell button ready to make that first pretty penny before someone else gets there. The day is especially important because good economic news had just been released so everyone is anticipating a big profit day. This is a typical scenario in a day where either corporate or economic news comes out. Volume rush higher and higher to catch up with the news development. But is it worth (read profitable) for traders?

There are many books, trading rooms and advisory services teaching traders on how to trade the news but the truth is the vast majority of people lose when they trade news, particularly against the market makers, specialists and other traders who have been around longer than they have. Is it because of faulty technique? Is it the fundamental news, analysts getting their numbers wrong? Or it's the traders themselves that are causing these losses?

One thing that has to be noted is that during the news announcements, there are lots of excitement, anticipation and anxiety. So this atmosphere creates an emotional factor to trading. For those cannot control themselves, they let their emotions take over. These can be harmful to their money without realizing what's really happening. Others come in without any hard concrete tactics or safety nets (i.e. stop losses). While there are other who come in with a gambling mentality for next adrenalin rush.

Trading news has a 50% chance of winning, leaving the probability of a successful outcome is unlikely. But also the fact that with so much volatility, there isn't really a sense of clear momentum swinging one way or the other.

Most don't understand the mechanics or psychology at work in the markets. When the good news is made, the stock goes down. When it's bad, the stock moves up. Taking the news at face value is obviously a losing proposition. No one knows when the price of stock has already absorbed the news and was now being unloaded by the pros. Even the positive surprise or negative surprise can be a real surprise when 30 minutes after opening, the stock starts going the other direction. Also, no one can be sure if the news has been leaked to cause the prices to do the unexpected and the insiders are now going the opposite direction.

If anyone who has traded currencies, trading news can be a handicap, especially with a broker who lock up their clients' orders during news break. This is common practice (please reread the disclaimer as well as the agreement document form when signing up a real account. It will be very enlightening).

There are professionals who do well because they have clearly defined their plan, such as when to get in, when to get out, and when not to get in and when not to get out. They may have taken years to finally master these types of setups in this hectic market action.

Not surprisingly, news carries different meanings to different traders. The numbers in the end don't really mean much because consensus is made of a group of high-profile analysts but they don't necessary represent the opinions of thousands of traders and institutions who put their money on the line. They vote with their money to give their opinion of what the piece of news meant to them. Some find it's a bargain and buy more, while others find it's too expensive so they sell. How does anyone know what ‘expensive' or ‘cheap' is?

Whether or not trading news is profitable, only time will tell for each trader, but one clear advice from this is NOT to hold a stock before earnings. By holding through the earnings, it's a guessing game. If he still likes the stock, by it back a few days after the earnings. Who knows it might have been oversold and now it's a "bargain." Of course there will be regrets if the stock does move in the desired direction. It's down to 50% chance: way or the other. But who want to gamble their hard earned money away so easily after sweating so much to get it?

About the AuthorLarry Swing CEO & Head Swing Trader http://www.mrswing.com theboss@mrswing.com +1 (281) 968-2718 Yahoo & Skype ID: larry_swing

Trading News: Is It Worth It?