Yes, that's correct.Originally Posted by hgsfan
Billy
Yes, that's correct.
Billy
Again, in the for what it is worth department.
Resistance at DR2
Most important for the trading plan is the easy passing at the first speed bump, weekly pivot (73.28). We now have gained one more support and can relax as long as it holds.
Billy
I spent a pretty good sum on TVIX insurance, but it has made the ride more relaxing. Nothing like watching the market move in your favor.
Hi Nickola,
May I ask why you hedge trades ? I don't see the benifit of hedging for individual traders like us. My understanding of hedging is it's something funds do because they can't get in or out of positions as easy as we do. I find that if a trade is position sized objectivly then the trade is as relaxing as possible without the need for adding complexity by hedging.
Hi Rembert,
With the high violatility of late, I have found that hedging eases the pain of down days, hours, minutes. Call this a response to the human factor in robotic and discretionary trading or insurance.
I concluded from this experience that when the market demands it, I will trade against my core positions.
Please correct me if I'm wrong, but such thinking is at the heart of options trading. Covered calls, verticals, and complex delta neutral strategies are all hedged. Thus, individual traders hedge their positions with regularity.
Best,
Last edited by nickola.pazderic; 11-16-2011 at 09:29 AM.
Putting on short term discretionary hedges would make sense to me if they are good trade setups on their own, (perhaps on a smaller timeframe compared to the main trade) not just as a hedge for insurance reasons. I'm also hedged from time to time but as a result of different systems/trade setups taking an opposite direction at some point in time, not for insurance.
True about the option traders. I don't trade options tough. I like to keep things as simple as possible. My goal is to make trading as relax as possible. That's also why I try to avoid looking at the market while it's open as much as possible.
Rembert,
You sound mature enough to know your strengths and weaknesses.
One year in, I remain an explorer. It is not what I'm trained to do. And I've considered the possibility of taking robot positions and carrying on with some research projects that interest me. But, I remind myself one thing: I started with this investment trek when I came to the conclusion that I could not trust mutual funds or other professionals with our hard-earned money. So, I continue to babysit. And as I watch, I experiment and learn. I find this enjoyable.
I post some findings for entertainment and pedigogical purposes only.
My hedges over night look good this morning: TVIX, TZA, and ZSL.
Best
Last edited by nickola.pazderic; 11-16-2011 at 10:24 AM.
Hedging is really a function of your trading style and of what the market offers you at a specific point in time. I am a swing trader with a trading/investment horizon of several weeks or more. Given that I am generally bullish ( which is not the prevalent "opinion" in this forum currently), from time to time, as a swing trader, I need to hedge my income producing and more speculative long positions with double beta inverse positions in order to preserve the hard earned profits from these long positions on downswings. Generally if and when I calculate the right hedge proportion required to protect and enhance my portfolio I actually generate a nice excess profit on the downswing as well.
Pierre Brodeur
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