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Hi Jonathan
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: From: Jonathan Stewart Dempster <aceit@xxxxxxxxxxxxxxx>
: To: RealTraders Discussion Group <realtraders@xxxxxxxxxxxxxx>
: Subject: Dream the Dream..!
: Date: Wednesday, June 03, 1998 9:17 PM
:
: hi, i am in the u.k. and also share the dream
: friend. I will be starting with limited capital (some say its way to
: small,) about 7,000 to 10,000 u.s. dollars and will commit 1,000 u.s.
: per month as well.
:
: I figure i should be able to support at least one trade per month.. Now
i
: have heard people say you need a minimum of say 25,000 really, but i
dont
: think that is so.... i wont be trading for the sake of trading, but
waiting
: on the sidelines for the oppurtunity which presents the least risk...(yes
: and i do know about the coin flipping theory, but the markets are not
: random,not all the time)
My view is US$7000.00 to US$10,000.00 for one contract of the slower moving
commodities or a Mid-AM may be just enough.
No trader irrespective of capital can afford to trade for the sake of
trading; to have
any chance of success, we all need to look for trades that place the odds
in our
favour. The rub is:
that assessment is one based on probabilities given that we
cannot foretell the future. No matter how careful we try to be there will
be times
when we encounter the dreaded drawdown and here's where adequate
capitalization plays its role.
: So my plan is to study charts look for extreme price levels, high and
: lows, work out trading plan, ie entry and exit points, place the order
and
: thats it.
Sounds reasonable enough.
:
: My stops... they will be placed at a significant technical point. ie
just
: below relative lows/historic lows and highs, or if this implies too much
: dollar risk then i will set a dollar risk value, (although i realise this
: might not always be the best way to go.)
Placing $ stops is tantamount to giving money to the mkt unless we're
in a strongly trending mkt with little backing and filling. You'd be
better off increasing your knowledge so that you can place technical
stops other than at historic extremes.
e.g.
Placing your stop 10%v below the start of a directional move. See
attached chart.
: As for psychology..... well i agree that the biggest problem people will
: face when trading is themselves.
: Hence my decision to establish a trading PLAN, prior to entering the
trade,
: i feel acting on intra day impulses just is'nt for me, for some i am
sure
: it does work, but i need to ensure my survival and i know my emotions
: greed, fear and panic might upset things if i day trade.
I agree that for most having a trading plan is a pre-requisite to trading
success.
As for disclosing my trading plan - that plan is an irrelevancy to anyone
except me. I say that because it's a plan that suits my trading style. Each
of
us has to find one that suits our personality. I'm sending what I consider
the essential elements of a plan directly to you.
all the best
ray
R Barros
101/25 Market Street
Sydney NSW 2000
Australia
Voice: 61 2 92673470
Fax: 61 2 92673478
E-Mail: rbarros@xxxxxxxxxxxxxxxxxx
:
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