FT has been trading full time from home for two years, with nothing but four kids and a beach to distract him .
He fills his spare time with weight training and rugby, though more coaching than playing these days.
FT mostly trades the forex markets and although he plays FTSE on occasions his bread and butter market is £$.
He likes to think that his technique is evolving but still hasn’t the temperament or money to back the big calls. He prefers to trade between 1 and 3 times a day, aiming to take regular small gains, but feels part of the evolution is in not dealing if the conditions don’t feel right.
Giving It Away
I spent most of the day giving away small amounts of money. No, I wasn’t donating to the local lap-dancing charity or giving to the needy that wait outside Sainsburys, armed with an assortment of tragic photos and a collection tin. I was making a pig’s arse of hedging a very warm option position, but I came through with both testicles intact.
Each month I supplement my forex and equity spreadbetting with some income from writing options. Yep, that’s the risky way round; the profit is fixed, the loss unlimited! Most of the time it’s fine, but every now and then (and there’s been a few of those in the past year) it requires drastic action.
I won’t bore you with the details, but hedging the options position is like the mirror image of normal investment practice; it involves buying high and selling low (or certainly lower), which is a tough way of trying to make money. The idea is to time the trades to get out with a profit or a small loss once the option position is safe.
So, that’s really what I was doing today. I had a brief look at the currencies, but realised the danger of trading when I wasn’t fully in touch.
Oh, and I went to the pick ‘n mix counter and placed a couple of sell bets on the banks. I sold a scrap of Barclays at 489p and a bit of Alliance & Leicester at close to the day’s low of 503.62p. These were sighting shots in small size. I reckon the banks got carried away yesterday, dreaming of Sir Gordon on his white charger coming to rescue them. But that’s not to say they won’t stay perky ahead of next week’s expected announcement of help.
Normal service will be resumed tomorrow.
Happy Trading
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