No paper trading tomorrow after all, not as far along with the home projects as I wanted. So back to the charts on Monday PM or Tuesday AM. In the meantime, I’ve decided to make some trading resolutions.
I bought my first stock ever on October 10th, and I started this blog on November 1st – and have paper traded for two months. I’ve learned so much and am light years ahead of where I started out. I used to use Yahoo charts to trade with, couldn’t comprehend the concept of shorting and message boards were my primary source of research. However, my expectations of myself are out of whack (its great to set the bar high, but I should be realistic). I am a little weary, the time and effort I have put into trading, if I focused this on my consulting business, I could likely generate another $10K to $20k a year, even in this bad economy. So not only do I need at least to break even with trading (at the minimum), in some ways, I have to overcome the opportunity cost of not spending all this energy on something more productive to my career.
Of course, I love this challenge – and this is mainly why I’m doing it. Plus, there is more long-term reward if I can get any good at trading. So here’s my resolutions for 2009.
1) Relax. They say you should paper trade to learn the behavior of the market you plan to trade, not necessary how you will react. However, paper trading causes me the same amount of anxiety as when I was using real money – I’m taking it too seriously. So I’m going to relax, the consequences of losing paper money are just more lessons learned.
2) April Fools. I’m going to paper trade for the next three months and evaluate where I am at that point. I originally planned to jump in with cash in the new year, but I have more to learn.
3) Trading Hours. Most of the time I’m going to take Mondays off to focus on real life work. Then the rest of the week, I’m going to paper trade between 9:30am and 11:30am, and then between 3:00pm to 4:00pm to take advantage of the most volatile periods of trading, and give me the middle of the day to pay the rent.
4) Batting Practice and Scrimmages. As I mentioned in my last post, when I don’t have time to prep ahead of time, I’m going to use a shotgun strategy to paper trading that I’m likening being at the batting cages to work on your swing. The more at-bats you get in, the more natural you become at hitting, and you can focus on specific aspects of your form. The point is quantity of swings one after another. On days when I have time to create a watch list and look at charts ahead of the opening bell, I’m going to employ a more rule-based approach that will be more like an exhibition game.
5) Healthy Living. The first half of 2008, I had great success with eating well, exercising daily, and running 5Ks. I had a surgery in May and never got back into my routine. I need to get on track as I know reverting to couch potato state is effecting my trading, both in terms of mental alertness and overall stamina. This is so important that if I don’t get into the healthy zone, I’m going to take a break from paper trading and blogging to prioritize it. I have been off caffeine for two months now, so that’s a start.
I could create a longer list, but these goals are manageable. I hope success finds me, and anyone reading this!
