It’s with some trepidation that I accepted timsk’s invitation to tell you a little about myself and my trading as it has developed over the years. I hope that this will be the first of many such articles by members – so I will kick off and trust that those who follow have a much more interesting tale to tell.
Before getting into it I want to make it crystal clear that I am strictly an amateur and my trading has never been, nor is today, more than a reasonably profitable sideline. I simply haven’t the balls to even have considered doing it for a living and I doff my cap to those who do.
Here I am then, at the back end of life with nearly fourteen years of retirement under my belt after a working life in HM Customs & Excise. A thoroughly enjoyable and fulfilling career it was, too, from the early days on the ground to the latter years devoted to management. Not the cushy number that some might imagine, but it did have permanence about it and I count myself fortunate not to be working in today’s more uncertain world.
Outside work, what did I do? Wife and family; golf (badly – and not improved since); bird watching – a great relaxation for taking your mind off other worries; hill walking; and dabbling in the stock market.
Trading – the early years
I got into trading – although that was an unknown word at the time – about forty odd years ago when a friend told me about a possible takeover, which would likely be regarded as insider trading’ nowadays. That made a nice turn in about six weeks and off I went thrashing about and lost most of it over the next year or so. I called a halt before it all went and didn’t do much for a couple of years, although I retained a lively interest.
Those were the days, of course, when it was all shares, everything was on the buy side (the general public had no means of shorting), short term was within the three week account, the spreads and commissions would make your eyes water by today’s comparison and you had to draw your own charts. Point and figure charts were the easiest.
I was convinced that playing the swings was potentially the most profitable and I gradually developed a ‘trend continuation after retracement’ method that I still use to this day. The main catalyst for that development was Gann’s three bar retracement method, later refined by the approach offered by Marc Rivalland in his book ‘Marc Rivalland on Swing Trading’.
The privatizations of the early eighties were good to us and gave us the capital to do more than just play about. I say “us” because my wife is equally interested and, although active, she is more towards buy and hold. Needless to say, she generally outperformed me and my clever swings year by year and still does – too often for my liking. Makes you wonder whether all the screen time devoted to short term trading is really worth it.
The next major push forward for me was my retirement. Armed with a fine computer system as a leaving present, I started getting much more involved and shorter term in my approach. Had a go at FOREX and got killed, so decided to stick to what I know and ignore the siren songs (not easy when there are lots of interesting FOREX reads on T2W). Set up a few play accounts for a bit of index trading and tried out various other bits and pieces (T2W again!!) that I thought interesting.
So here I am today, doing pretty much what I’ve been doing for years. A lot less mechanical in approach than in those early years and much more reliant, rightly or wrongly, on my feel for the market.
The main account, then, is devoted to swing trading a flexible stable of FTSE100 equities looking for potential trend continuation after 3+ bar retracement. I use zones, rather than specific price, for entry, target and stop loss. I use daily charts for the outline planning and drop as low as M5 for final decisions when price is within the zones. The “feel” comes from finding momentum which I think is the essential element. This contribution to the Articles section on T2W back in 2005 gives a reasonable insight into my approach: Simple Swing Trading
I’m not greedy and I don’t try to wring the last penny out of a trade. I know my statistical expectation and what I need to take from a trade to keep my account ticking along. I won’t take a trade unless that potential is there in my eyes and I try to make sure I get it, so I protect that level should price come back to it before it’s reached my target. In some sense you might say I trade my account rather than the individual trade which is viewed as a complete “no-no” by many.
I’ll just stick to my last, but I will raise my FTSE/DOW pair trading to main account status having played with it quite successfully for the past couple of years. (This is the thread about it: Barjon’s Money Machine)
Tips to pass on
I can only mention three things that have served me well.
Firstly, momentum is king. Unfortunately there is no handy rev counter but, if you are into charts, a better clue comes from how a bar forms rather than what that bar looks like in the end.
Secondly, trading is a business and it’s the bottom line that counts. Each individual trade is not the be all and end all. It is only important in terms of its contribution to the overall business.
Thirdly, it is exits that move your account and they deserve much more attention than do entries.
I can’t finish without saying a little about Trade2Win. I’ve been a member for a long time, learned a lot and made many friends – in the flesh as well as in the ether – and I’m very fond of the place. It’s a very different beast from the early days, of course, when almost every thread was interesting, informative and full of lively, constructive and civil discussion. Still full of a lot of good stuff, though, and I thank the staff and moderators for their tireless efforts to keep it on track and the many members whose contributions I have enjoyed – including many who gave me so much grief during my moderating years!!
Good trading everyone.