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.
Hot Markets, And Computers
Hi folks,
For once I’m almost lost for words. This morning was like being force-fed day-time TV, it was so dull, but this afternoon’s action has passed me by. I’ve been stuck on the ‘phone to a BT call centre in India, trying to sort out my non-conforming Internet.
Big respect to the hardy few who’ve been calling the long equity bet; there ought to be some tasty profits on that bet today. I’m happy to admit that I got that completely wrong. And I’m even happier that I heeded your warnings and didn’t bet against it.
When I set up my office to trade from home I thought I was pretty thorough. I’ve got three independent computers, two phone lines and a crappy mobile for emergencies. I covered the possibility of Internet problems by subscribing to two separate broadband providers and I’m next door to the bathroom in case trading is going really badly.
But over the past week my normally reliable BT Internet has been playing silly buggers; it seems that incoming phone calls cut the Internet off. Worse still, I think the fan on my back-up laptop has gone AWOL, leaving it hotter than a date with Kylie. But, unlike a date with Kylie, it means that all functions are working in super-slow mode.
I attempted to trade the Dollar after the unbelievably good (and I mean ‘unbelievably’) US GDP numbers. I sold GBPUSD, just in £1 as I reckoned the aftermarket would be volatile, at $1.8340. But with the deal going through in slow motion, blocking me from trading, I opted for a quick profit as soon as my computer cranked into action. Closing out at $1.8325 put £15 in my back pocket and allowed me to concentrate on healing my BT connection. Since then GBPUSD’s dropped down for a sniff below the $1.83 big figure. I’m tempted to have another pop at it, but I’d be daft to take the risk on a steam-driven laptop.
Stand back in amazement; I haven’t sold FTSE today. When I felt the fever coming on I wrote a few out of the money Calls, which did the trick. I can’t bring myself to buy the market, but neither am I going to offer a financial sacrifice to the trading gods. Trading’s been good to me since my holiday so I’ll bide my time, stand in the queue and wait for my next opportunity. The daily chart isn’t showing FTSE as overbought, there’s a uptrend channel there for those that need it and even the moving averages are in the right sequence. But I’m still not going to buy it!
Just be aware that tomorrow is month-end, which sometimes brings a bit of monkey business to the markets.
Happy Trading
August 29th, 2008 at 11:09 pm
Hi FT
sorry to hear about computer problems and those call centres are a nightmare…have been there, done that…
yup, long financials, long consumer stocks and long US equity indices makes me a happy bunny this evening. Kingfisher, Lehman, HBOS and AMBAC especially! Very risky, very rewarding. For the record, I’ve closed out the big gold short from 977 - doesn’t seem to want to go much below 830, but I’ll be tempted to go short again if the gold price gets up above 870 or thereabouts, or if oil drops and USD rallies further. Shame you didn’t run the cable trade - I think there’s more mileage in that one. I think the next thing I’m going to do (although I may have slightly missed the boat) is take a look at some housebuilders and real estate stocks. Workspace Group has been great - bought at 118, now sitting around 136 - 140. I also think it’s entirely possible that if/when the hurricane blows over we’ll see another drop in oil below the $110 mark, but can’t quite bring myself to trade it. Feeling very smug which is probably exactly the time to take some profits and stand aside for a while. But running it all with plenty of margin to spare and stops in place in case of any nasty bumps in the ride.
August 29th, 2008 at 6:20 am
Blimey Flash,
talk about multi-tasking. I struggle running more than 3 positions at a time, though I guess once you’ve got your stop close to break-even it’s more relaxing. Yep I was gutted to quit the Cable trade early, but I like to be in control of my trades and I wasn’t y’day with hot laptops and distracting phone calls. Also, I’d have been stopped out on the 30+ pip bounce b efore the real sell off so no big deal.
Good luck with the trades. You’re having a helluva run at the moment.
August 29th, 2008 at 6:52 am
Hi FT,
Funny how the IT gremlins never seem to work alone.
You can always spend the day at your local McDonalds and hook into their free WiFi if both your ISPs give up on you.
Much as it pains this old eco-warrior to say it, my long and bitter experience tells me that the best action with misbehaving hardware is to junk it at the first sign of trouble and buy a new PC. The cost of the new kit is nothing compared to the time, money, grief and hassle that the old one will cost you.
Onwards and upward for FTSE today, I think. Sold some Sep 5800s yesterday. Question now is when to take profits on my long position without leaving me overexposed on the calls — who’d have thought we’d be starting to think about 5800s expiring in the money.
August 29th, 2008 at 7:06 am
Hi Ken,
Hmm, I think sitting in McDonalds is too big a price to pay, but I get the point. Once I sat in the car outside the doctor’s surgery and picked up a signal, but he’s password protected now. I’m expecting a day of BT robotic mesages telling me every part of the engineer’s journey as he strolls towards the house. I guess the laptop at two years old could be ageing prematurely under the duress of 13-14 hours a day.
I’ve written 5825,75,5900 and 5925s so it could be an interesting run. I’m really not going to enjoy hedging at that level with a huge potential downside. Considering Oct 5950s if they get to 40.
Month end I guess fund managers won’t want to show too much cash on the books so I won’t stand in the way of a further move up.
August 29th, 2008 at 8:08 am
well, I’m trying to run the Flash Rabbit fund thematically - just like a micro macro hedge fund! Hence having more positions than the kama sutra which can lead to plenty of pain when the market bends the opposite way but a lot have now been running for some months/weeks so I have comfortable cushions for the volatility. I’ve had an incredible year - up 300% so far from a Feb start which is extraordinary for a complete amateur/beginner like me. So I’m trying to be cautious and not too smug. One of my problems is that I have trouble saying ‘no’ to what look like appealing trades - but I tend to only trade in very small amounts (I have an account with another provider that allows me to trade 50p/pt which suits me very well, and has enabled me to build up some of my longer running positions without having a ton of initial margin). Take note, if PP offered 50p/point I’d use the system even more…I’m sure that’s true for lots of other beginners like me as well. Demo trading is helpful - I have built up an enormous fund on my demo trading account and I’d recommend to anyone that they try out their trading approach with paper money - it’s helped me have the conviction to run my profits for longer which has been the key to my success so far.