One Year To Nowhere

[X Factor 1,112]

Exactly. And I would venture to say that the key is also to take emotion out of it. If I have a set of tools - I'll follow them blindly. Sometimes they won't work, and I won't care, as long as I stuck to the plan. Most times they will work. If I didn't stick with the plan and made money or lost money I'll feel much less confident than sticking to the plan and losing money.

Once intuition is out of it, once emotion is out of it, you're already 3/4 of the way to profit.

Being I combine "longer term" trading with swing trades as well as intraday trades I could basically have many different puts and calls at the same time. But I'm mostly a Delta trader. I try to eliminate the Vega and the Theta. I pick a direction and trade it.

I have the same systems for gold, oil and the dollar and so far like I said the first two are still short and the latter is still long. But just as I have written above, that at times I'll anticipate the turn before it actually does, I think a reversal is at hand. My guess is it will come together with the near term bottom in stocks, as they seem to still be tightly correlated.

I concur.

Trading rules I have adopted & review regularly. It sets one apart from being an average trader.

1. You have no trading plan

2. You have no money management rules

3. Youre prone to emotional swings

4. Youre nervous when in a trade

5. You revenge trade

6. You dont cut your losses fast enough

7. You never review your trades

8. You are losing money

BTW the spx futures are flat which is great for my Iron Condors

Edited January 18, 2016 by X Factor

[ExPatty 502]

Still most pro investors cannot beat the market. They make money on churning their clients' cash not their own. If there were any obvious ways to beat the market everyone would obviously do them, which would be a catch 22 and this is why there are no obvious ways to beat it and science still has yet to prove the efficacy of technical analysis or reading charts, etc. some psyccholigxLly see the market as a lumbering stupid beast that can be beaten but all it is is an average of individual people all rolled up. Some are stupid, some are smart. But they are all trying to do the same thing: beat everyone else. The only way for any investor to consistently beat the market is by doing something most others are not, which necessarily means he is doing something not entirely obvious.

If you think you are beating the market, are you tracking it? Because this link is one of many: http://www.thestreet.com/story/11621555/1/average-investor-20-year-return-astoundingly-awful.html so not only are these people losing money but they are working hard to do so. If they instead had no idea what to invest in and sunk it in an index fund they would have not only more free time but more money as well.

Edited January 18, 2016 by ExPatty

[OriZ 3,157]

I concur.

Trading rules I have adopted & review regularly. It sets one apart from being an average trader.

1. You have no trading plan

2. You have no money management rules

3. Youre prone to emotional swings

4. Youre nervous when in a trade

5. You revenge trade

6. You dont cut your losses fast enough

7. You never review your trades

8. You are losing money

BTW the spx futures are flat which is great for my Iron Condors

Yes, definitely no revenge trading. As long as you stuck to your plan, even if you lost on a certain trade, it's all good.

Still most pro investors cannot beat the market. They make money on churning their clients' cash not their own. If there were any obvious ways to beat the market everyone would obviously do them, which would be a catch 22 and this is why there are no obvious ways to beat it and science still has yet to prove the efficacy of technical analysis or reading charts, etc. some psyccholigxLly see the market as a lumbering stupid beast that can be beaten but all it is is an average of individual people all rolled up. Some are stupid, some are smart. But they are all trying to do the same thing: beat everyone else. The only way for any investor to consistently beat the market is by doing something most others are not, which necessarily means he is doing something not entirely obvious.

If you think you are beating the market, are you tracking it? Because this link is one of many: http://www.thestreet.com/story/11621555/1/average-investor-20-year-return-astoundingly-awful.html so not only are these people losing money but they are working hard to do so. If they instead had no idea what to invest in and sunk it in an index fund they would have not only more free time but more money as well.

I can tell you with certainty I beat the market on a monthly basis. I'm not going into what exactly my average monthly return is because chances are you won't believe me and that's a whole nother conversation I'm not willing to go into until I decide I am willing to give up my privacy and prove it

[X Factor 1,112]

Still most pro investors cannot beat the market. They make money on churning their clients' cash not their own. If there were any obvious ways to beat the market everyone would obviously do them, which would be a catch 22 and this is why there are no obvious ways to beat it and science still has yet to prove the efficacy of technical analysis or reading charts, etc. some psyccholigxLly see the market as a lumbering stupid beast that can be beaten but all it is is an average of individual people all rolled up. Some are stupid, some are smart. But they are all trying to do the same thing: beat everyone else. The only way for any investor to consistently beat the market is by doing something most others are not, which necessarily means he is doing something not entirely obvious.

If you think you are beating the market, are you tracking it? Because this link is one of many: http://www.thestreet.com/story/11621555/1/average-investor-20-year-return-astoundingly-awful.html so not only are these people losing money but they are working hard to do so. If they instead had no idea what to invest in and sunk it in an index fund they would have not only more free time but more money as well.

True for the most part especially if you are delta long or short without a hedging mechanism. A sizable part of my trading is not directional like most traders. I sell premium and that puts the odds in my favor. I do pairs trading too. On Monday January 4 th I shorted gold and went long silver in proportional amounts. Why? Well these 2 asset classes are highly correlated. On the 1, 3 and 6 month charts they had a separation of 2 standard deviation. That is why I did that trade. I am basically flat in profitability in this particular pairs as of now. I will hold for about 1 to 2 months. (Every time I did this trade in the past with this pair I was profitable). They are still about 2 standard deviation of separation between the two. I don't like to do pairs trading on stocks since they are riskier and earnings throws things off. So I do in in indexes and ETFs.

Edited January 18, 2016 by X Factor

[OriZ 3,157]

A sizable part of my trading is not directional like most traders.

See that is where you and I are completely opposite. I find that selling premiums is good 8 out of 10 years but then there's two years where alot of traders just get eliminated, especially years like 2008 and like 2016 may very well be. I am very much a directional/delta trader as mentioned before.

[X Factor 1,112]

See that is where you and I are completely opposite. I find that selling premiums is good 8 out of 10 years but then there's two years where alot of traders just get eliminated, especially years like 2008 and like 2016 may very well be. I am very much a directional/delta trader as mentioned before.

I need to clarify. A sizeable part of my trades from days to a week are selling premium. But intra day I am delta long or short. I look at internals and then do calls or puts and rarely hold them overnight

[Expat1 971]

Thing is, I don't do stocks. I do options and futures. That is it. Stocks are boring. Any child can make money in stocks, there is no challenge there. Selling naked means unlimited losses and I don't do unlimited losses. If the market is at a bottom, I don't touch stocks. I open up synthetic Long futures positions on SPX or SPY.

I am thinking that this would be just another way of doing stocks

[OriZ 3,157]

I am thinking that this would be just another way of doing stocks

Well it kind of is, which is why I do it. I am basically long(or short) the market as a whole. I just prefer it over buying individual stocks. I don't care about the actual companies.

Edited January 18, 2016 by OriZ

[Expat1 971]

Well it kind of is, which is why I do it. I am basically long(or short) the market as a whole. I just prefer it over buying individual stocks. I don't care about the actual companies.

Out of curiosity you mentioned the indexes and commodities but do you do any sector trading? Dabble at all internationally?

Edited January 18, 2016 by Expat1

[OriZ 3,157]

Out of curiosity you mentioned the indexes and commodities but do you do any sector trading? Dabble at all internationally?

Well, prior to 2007(when I landed in Milwaukee) I used to trade TA25(in the Israeli stock exchange). I was already very familiar with the US markets though of course because of the tight correlation global markets have these days. Once in Milwaukee due to the time difference and not wanting to be up all night I got into the US markets and then stayed with them even when I was back in Israel for a few years(my trading hours then just changed from 9am-5pm to 4pm-11pm). So right now what I'm doing is US stock markets, Oil, Gold and USD. No other sectors or markets at the moment.

[Expat1 971]

Well, prior to 2007(when I landed in Milwaukee) I used to trade TA25(in the Israeli stock exchange). I was already very familiar with the US markets though of course because of the tight correlation global markets have these days. Once in Milwaukee due to the time difference and not wanting to be up all night I got into the US markets and then stayed with them even when I was back in Israel for a few years(my trading hours then just changed from 9am-5pm to 4pm-11pm). So right now what I'm doing is US stock markets, Oil, Gold and USD. No other sectors or markets at the moment.

Clear. Looks like another couple percent will get shaved off today.

Want to re-think that spring thing?

Edited January 20, 2016 by Expat1

[OriZ 3,157]

Clear. Looks like another couple percent will get shaved off today.

Want to re-think that spring thing?

Why re-think it?

I agreed with you by spring time we'll be significantly lower, I just think that won't be all of it. I'm still waiting for a panic flush possibly this week and then we should bottom for a little while(like I said I think that will coincide with at least a short term bottom in oil, but I'll stress again that that is just a premature estimate and that my system is still SHORT oil). Yesterday was clear it was going to fizzle as there can never be any real bottom without panic. Sure, it could have lasted even more than a day, but eventually we would have broken Friday's lows(which is what we're going to do today).

Edited January 20, 2016 by OriZ

[Expat1 971]

Why re-think it?

I agreed with you by spring time we'll be significantly lower, I just think that won't be all of it. I'm still waiting for a panic flush possibly this week and then we should bottom for a little while(like I said I think that will coincide with at least a short term bottom in oil, but I'll stress again that that is just a premature estimate and that my system is still SHORT oil). Yesterday was clear it was going to fizzle as there can never be any real bottom without panic. Sure, it could have lasted even more than a day, but eventually we would have broken Friday's lows(which is what we're going to do today).

LOL

This isn't the flush but the bushes are being beaten. Should see the bunnies scatter anytime.

I'm going to start averaging in on dips (like today LOL - Mannnnnn its a shame this market is so overvalued) when the Shiller breaks 20. Should correspond to market cap/GDP of 88%, the upper end of fair valued.

Thankfully, I will have missed all but what I believe to be no more than 15% of the above point of additional carnage. I'm reserving about 10-15% for EM, Asia excluding China. Call it play money.

I'll be buying into 100% stocks. No bonds. 70% stocks, 30% cash - I'll dump that in on the rise.

Edited January 20, 2016 by Expat1

[OriZ 3,157]

Basically what I am looking for now is some "flush panic". I think it will happen in the next week or so. I need a day that starts down at least 3-4%, and then closes much higher. With the VIX in the high 40's. I think that will give us a better bottom that could last for several weeks and create the range I mentioned earlier.

Looks like what could end up being a reversal day. No, VIX didn't go in the upper 40's. In fact, the VIX seems to be sleeping which is another way bottoms are made - by simply not confirming the decline. The VIX now is at the same point it was Dec 14, with the S&P500 almost 200 points lower. But we did get declines of almost 4% and then a reversal to flat now(with the Russell and Nasdaq going positive). This might work. It won't last too too long, but it could give us anywhere from 1950 to 2050(less likely) again.

lol...yeah, there's no panic. Like I said I want VIX in high 40's and an opening of at least 3-4% down at the open(similar to what we had on Aug 24) with an intraday reversal. That is what i like to call a "panic flush" and that normally marks a decent(albeit not necessarily forever ever lasting) bottom. And I think that's coming next week.

Depends on what kind of panic and what kind of bottom. I think a temp bottom is definitely at hand soon, and we'll see some panic before this month is over. But then, like I said I think we will end up in a range for a couple months, 1800-2000 give or take 50 points. I don't really see levels lower than 1750 till sometime mid spring.

1812 as the low today...

Because of this at 3:58 pm right before the close I sold some Iron Condors, SOLD - IRON CONDOR SPX (Weeklys) JAN4 16 1940/1950/1780/1770 CALL/PUT @2.40. With the 3 day weekend that will cause time decay and the expected move next week of about 70 spx points I will close the position out for 1.15 for a bit over 50% profit or exit Thursday if profit target isn't met

This strategy has a probability of 76% success if waiting for it to expire worthless by end of next week. But by taking profits around 50% my probability of success is considerably higher somewhere in the 90% plus.

From Friday's close to today low = 68 points

Yup, definitely a 70 point move next week. You'll do fine.

Did you close it?

[OriZ 3,157]

LOL

This isn't the flush but the bushes are being beaten. Should see the bunnies scatter anytime.

I'm going to start averaging in on dips (like today LOL - Mannnnnn its a shame this market is so overvalued) when the Shiller breaks 20. Should correspond to market cap/GDP of 88%, the upper end of fair valued.

Thankfully, I will have missed all but what I believe to be no more than 15% of the above point of additional carnage. I'm reserving about 10-15% for EM, Asia excluding China. Call it play money.

I'll be buying into 100% stocks. No bonds. 70% stocks, 30% cash - I'll dump that in on the rise.

Definitely saw some buyers come in today...was that your doing? LOL