For those that are interested you can read my weekly FTSE analysis here.
I would like to thank Tony Loton again for posting a comment about my blog on his earlier this week. He wrote “They say that imitation is the sincerest form of flattery, and it seems that Spread Betting Beginner has decided to maintain a similar blog to my own.” Well Tony I think you should feel flattered by me maintaing this blog. It was because of his blog that I decided to start this one. I think that the two blogs serve a different purpose though. Tony is demonstrating his “Position Trading” Strategy, where as I am someone who is still trying to find a strategy that suits me and stop wasting my time and money trading foolishly. One day, hopefully, I will be able to keep a blog similar to his where I am a successful spread bettor and I can demonstrate my own strategy.
I have to say that I have read Tonys “Position Trading” book and really liked it. I like the idea of his position trading strategy, however, I think for the beginner, such as myself, its a difficult strategy to implement and stick to. I think any beginner will find a drawdown in there portfolio value from £1600 to £600 in 4 weeks too much to handle. It’s a good approach but I think any beginner will find it too emotional for them and end up giving up before it gets a chance to really come good. I think if you have turned £300 into £9000 in 6 months as Tony did then you will be more comfortable riding the storm and excepting the drawdown as a fact of the strategy in anticipation of the huge return that is possible. I think if the strategy had some definition of when to wait on the sidelines and avoid the massive draw downs it would appeal to the beginner more. To be honest this is kind of why I have recently adopted the momentum divergence strategy. The key Idea of the strategy is to try and find the bottom of a downwards movement much as Tony is doing with his position trading. I think using the momentum divergence strategy gives more of an edge to the trades. That said he looks for stocks that are bouncing off support levels and when he trails his stops he pays respect to recent support levels to keep his positions open as long as the price is rising.
If you want to learn more about Tonys strategy I would recommend reading his book. It has some useful stuff in there and I think it is one of the most straight forward books I’ve read. He has also written some other good books on stop orders, Don’t lose money and financial trading patterns. He has written some others but I have yet to read them.
I’d like to thank Alan for the comments he left here the other day. You said you are short on 4 positions. I have a question for you if that’s ok. What strategy are you using to find these short positions? Is it one of Malcolm Pryors from one of his books? I would be interested to know as I need to work on a shorting strategy myself.
Anyway I think that is everything for now. I would like to thank “E” for his e-mails this week I will respond to your latest one soon I promise. Anyone else that would like to e-mail me about anything please feel free to do so.
Here’s a quick account summary.
The risk value may change as I have yet to check and move my stops this week. I will try and post my new orders for this week, if there are any, later. If I can’t do it later it maybe tomorrow or Monday morning.
 That’s all for now.
Until Next time
“May the markets be with you”
June 12, 2010 by Harry
Category: blog