Long-time readers know that, every month since I’ve started, I’ve been wanting to work on my trade-rate. Well, unless May turns out to be an anomaly, I’ve finally reached a level I’m happy with. I made twice as many trades this month as last month, while maintaining a good win rate and expectancy. There were only three trading days where I could not find a trade I wanted. Check out May’s Calendar View of my trading, compared to April’s Calendar View (not to mention, lousy February…).
I’ll cite two contributing factors to my increase in trade rate (unless it turns out to be an anomaly this month, which would make the next couple paragraphs complete BS):
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I did an investigation and wound-up switching to point and figure charts as my primary trading chart (for both daily and intraday views). I took five trades this month that I consider “point-and-figure”-specific plays, but at present I’m still primarily scalping. I just spot the moves on point and figure charts, rather than another kind.
A big benefit of pnf charts (and, really, volume charts as well) is that they tend to break out more detail about the price action at the open. As such, I’ve found myself suddenly able to trade during that all-important first hour of trading. It’s been a huge help. Back when I was watching 15′ or 30′ charts, the morning hour was basically an information void that I couldn’t safely trade against.
- Hanging out on wallstreak and jaiku has been helpful, because especially on wallstreak people keep asking me what I think of stocks. I would normally never look at most of those stocks, because of how thinly they trade. But, once I pull the chart up to give my opinion, I find myself identifying trades I want to take. I’ve had some success with the thinner stocks, but I have to use limit orders to get out, which bugs me.
May also saw my 2007 profit reach 100R. Here’s hoping it reaches 200R by December! That would rule. Here’s the R-chart from 2007 so far, courtesy of StockTickr (the blue line is a 20MA of the profits):
As you may have noticed, I’ve started to review my trades from a year ago, and it’s making me curious about why I abandoned the trading ideas I used to employ. It’s early yet, but right now I think the ideas were decent, but that my execution was all over the place. So, just today, I tentatively reintroduced the “ema-reversion” idea, with some success. Maybe more will be coming. Or maybe that was the only good idea I had back then! Time will tell.
I’m too lazy to do all the tables tonight, and tomorrow I have my 30th Birthday to contend with, so we’ll just do the summary table this time, and return to the more detailed stuff at the end of June.
Overall Performance as of May 2007
| May | YTD | |
|---|---|---|
| Total P/L: | 40.94 R | 110.36 R |
| Trades Taken: | 27 | 79 |
| Winners: | 23 (85.19%) | 64 (81.01%) |
| Losses/BreakEvens: | 4 | 15 |
| Expectancy: | 1.52 R | 1.40 R |
| Biggest Winner: | 7.11 R | 9 R |
| Biggest Loser: | -0.8 R | -1.15 R |
May 31st, 2007 at 8:37 pm
Hey, Ive been reading your blog for a while now, and you’ve been an inspiration to me.. its nice reading “real people” blogs, instead of talking head blogs. anyways, its funny seeing you review your trades now, that you took then, hopefully when i look back at posts i make, ill be able to be sitting on a profit, thinking, wow, what was i thinking..
May 31st, 2007 at 8:50 pm
here’s to 200R by the end of july…great job
May 31st, 2007 at 10:31 pm
That’s some impressive stats, congratulations Richard. Keep doing what you’re doing and you’ll have no problem hitting 200R by December. Looking forward to seeing you reach that!
June 1st, 2007 at 1:39 am
Those are some impressive numbers Richard !! Are those trades all scalping ? If you don’t mind to reveal more of what you do, could you guess what your position size limitation is taking into account the markets you trade, ie: 2 times, 3 times your current size or more ?
Anyway, congratulations !!
June 1st, 2007 at 5:48 am
Boy, those 3 losing trades you had last month must have really hurt. ;-)
Great job, Richard! Very impressive.
June 1st, 2007 at 6:31 am
Thanks for raising the bar!! A paradigm shift for me to what kind of profits are possible. Congrats!
June 1st, 2007 at 8:20 am
zoomie: that’s why he allowed me to post here…it makes him look even better :-)
June 1st, 2007 at 10:05 am
Thanks, all. TCS, if you look at the reviews from the last few months, they have tables broken out by the type of trade it was. I was just too lazy this month. But, anyone can go to http://www.stocktickr.com/report/totalr/idempotent/ at any time and slice and dice the data. That’s how I pull all the reports, anyway. I believe you’ll find the majority of the profits come from scalping plays.
Most, but not all, of the stocks I trade can absorb just about any number of shares at the breakout point. To increase the leverage I use, I’d need to either put more money in my account, or move to a broker with 4:1 intraday margin (I’m on 2:1 now). But, I’ve actually been going in the other direction. As I’ve increased my profits, I’ve been decreasing my risk. Making 40R a month, if I can keep it up, would allow me to get by risking a very small percent of my account per trade. I’m pretty excited about that. Makes my equity curve smoother and smoother.