Friday, July 11, 2008

Trading Week Recap

It's been a great week.

I've been able to apply a new strategy dealing with negatively correlated pairs and I've also been able to put together a couple of reasonably successful days by working to curb my greed and waiting for appropriate entry times based on my signals.

How successful were these last couple of days?

Yesterday I increased the NAV on my high risk account by ~5.6 percent. Today I blasted out a very nice ~7.3 percent. Holy crap! This makes two days in a row that I've taken a good portion of my earnings and transferred them into a long term low-risk carry trading account.

You may be wondering why I do that. Well, it's very likely, perhaps probable, that I'll eventually blow up my high risk account. So, when it's profitable, I move my earnings to a safe place so I can continue to risk an amount I'm comfortable with. Obviously, I want to earn and protect more than the entire NAV of my account before eventually blowing it up. Then it will be time to learn from my mistakes, re-fund the account, and try again.

So, the method to my madness is that it's a lot more fun, or exciting, to participate in high risk big return speculation. As I get better at this I am able to generate a net overall positive return -- which I then put to work in long term carry positions at very low risk. This means I get to have fun every day, mixed with some hair loss on tough days, as well as building a slowly increasing carry trade income.

In the long term, this might work out well.

1 comment:

kamel said...

good post