Double To A Million - Step 18 - Market Reversal
I have made a second trade utilizing all the available funds from the DTAMP stake with a Mutual Fund that emulates two times the Russell 2000 Index.
This trade went fairly well as I basically got in at the lowest possible point before the Market turned. Trading a Mutual Fund has advantages and disadvantages. One disadvantage is that in order to get in you must place your order before 3:35pm EST to get filled and you must make the right choice the day before the Market is going to turn in your direction.
You cannot come in the next morning and get a position if you see things turning as you can with stocks etc.
Current Status:
Cash - $603.66
Penny Stocks - $51.00
------------------------
Total - $654.66
I made a trade using $603.64 , sometimes the Mutual Funds amounts do not match perfectly to what I am trying to get.
Buy:
Date: 08/15/2007
Quantity: 21.667 Shares
Price: $27.86
Amount: $603.64
Sold:
Date: 08/17/2007
Quantity: 21.667 Shares
Price: $30.35
Amount: $657.59
Profit: $53.95 +8.93745%
This trade lasted only two day but with the Markets being as volatile as they have lately, being in for any length of time can be dangerous and nerve wracking if you are trading short term.
What I am attempting to do is take smaller percentage gains and accumulate them over time. If there is a profit, when in doubt take it out.
I was looking for maybe 2 to 3% gain on the average each trade but this trade made +8.93745% which was outstanding.
Adding the +8.93745% with the previous +0.9956% gives a total so far of +9.93305% gain in 17 days.
This is far beyond what I had hoped and I am not expecting to continue on that rate of increase.
So far this trading attempt has yielded $59.90 towards the Double Your Way To a Million Stake.
Present Stake: $708.61
Motto: It is only "one" found penny.
Slogan: As Simple As Finding A Penny.
Regards,
Xinfinitum
This Doubling Blog is based upon the Doubling Plan "How to Double Your Way to a £Million in 28 Steps". It is an attempt to "Double Your Way to a Million" by going from one penny to one million dollars, starting from nothing. At the beginning you start by finding a penny and then double a penny until reaching $1,000,000.
D.T.A.M.P. - Double To A Million Plan
posted by Xinfinitum | 6:40 AM PermaLink
2 Comments:
hello.
a few thoughts and some q's.
i too have been wooed by the market and more recently "Mr. Market's" insanity (WB ref). in the process i've calculated that a 1-2% return per week would gross over 78% per year. let me verify this. brb.
ok. back. i'll show my work so that any errors can be corrected and we all benefit.
1% per week for 52 weeks would be: 1.01 raised to the 52 power ( or for those that don't like exponents, 1.01 x 1.01 x 1.01 ... listed out 52 times for the 52 weeks )
the result is: 1.67768... which would be approx 67.77% for the year.
2% per week: 1.02 raised to the 52 = 2.800 which, if i understand this is 180% for the year.
incidentally, since i couldn't remember where the 78% came from, i found that 5% per month returns 79.59% per year.
all that said, how does one guarantee they meet those objectives? it is based on "compounded interest" meaning the full amount goes fwd each and every time. if one gets stuck w/ a loss or decides to stay in to avoid a loss... it can get rather nerve wracking.
so, that said, have i actually done this? no. in fact, i let a very short term 18% fade into a "paper" loss that i'm sitting on. i will list the stock, but i'm not certain the legalities of doing such. i'm not a professional nose, i mean stock picker. i am not advising anybody to jump on board. given my history, even if everybody did and it doubled i might not sell. go figure. anyway, the stock: AMD. for anybody reading this, again i add, do your own homework, or as in my case, as it seems, use your own dart board.
yes, i did mention the stock because of a mention of INTC in the past. again, ppl, do your own homework.
ok now that that is out of the way, how do you deal with commissions? and taxes? will they be subtracted from your DTAMP stake?
other than that, there are trading tools that allow "us" to trade w/o being on the edge of our seats biting our nails. 2 that may be of some use in this context are "stop loss" and "trailing stop loss."
lastly, one thing i wish to look into is "selling covered calls." yes, it is options, but it's not as risky as one might think. first off the "covered" part means you own the underlying stock. 2ndly you're "selling" the Call meaning you are selling an option to someone else to buy your stock. they may chose to do so or they may not and the option expires. as far as i can tell (yes, reread that as WARNING! WARNING!), as long as you don't sell the stock!!!! before the option expires, the 2nd worst case scenario is that they exercise the option and the stock takes off. worst case would be for the stock to plummet, i s'pose, but you still were paid for the sale of the options so there's some benefit there. need to research this more.
happy trails. peace & 42
Hi,
Everything you said seems reasonable regarding percentages, options, stops.
Regarding the few questions:
Commissions - I am trading something witn a certain brokerage firm and there are no commissions so I do not need to worry about that. Otherwise yes I would remove them from my profits before adding anything to the stake.
Taxes - I guess if there are capital gains on any DTAMP stock trades and I have to pay taxes on it, it will need to be calculated in later. At this point I have no capital gains so I am not going to be calculating taxes in at this point.
Regarding Guarantee of meeting objectives - That is a tough one and like everything I guess it is all risk and I am not going to be able to Guarantee to myself that I will reach my goals.
But I need to take it step by step and keep moving forward until reaching that next plateau. There is the possibility, and a good one, of getting stuck in a trade and having to wait it out, or clearing it out, taking the loss and starting again.
All I can do is go with my Gut feel and listen to the inner voice. :-)
Regards,
Xinfinitum
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