Do we have hot streaks as a trader? There is some research here from the must read @jonahlehrer that suggests that the belief there are shooting streaks in basketball is not supported by the data. I asked Dr. Jonathan F. Katz of High Performance Associates and who works with traders for his thoughts (see below): Ah, the age old question, perception … Read More
Dimes for Dollars
The second reason many traders fail to “stay with the move” is the fear of giving some profits back. The overriding emotion of having to get every penny in every trade causes them to get jumpy as soon as the stock does a stutter step. That’s fine if you are willing to get right back in if the trend resumes, … Read More
Confirmation bias and the trading this week in SLV
From Ian Leslie in his blog why is reasoning really all about winning: It’s been shown again and again in studies that we have a very strong ‘confirmation bias’; once we have an idea about the world we like (Obama is un-American, my girlfriend is cheating on me, the world is or isn’t getting warmer) we pick up on evidence … Read More
Fighting for the best prices
I was standing behind a new trader, Battery Park, watching him buy a pullback in a Stock In Play. Battery Park bought 76c and hit out at 63c. He should have hit out at 69c. Then Battery Park reentered at 65c when he could have bought 58c on the bid. We talk about Reading the Tape often in this blog but … Read More
Buying a Pullback (LVS)
LVS gapped down from 45.40ish to near 40 in the premarket and then recovered some. From Bloomberg.com Las Vegas Sands Corp. (LVS), the U.S. casino company expanding in Asia, reported first-quarter sales and profit rose less than analysts’ estimates on lower winnings from table games in Nevada. The shares fell in late trading. Net income climbed to $289.3 million, or 28 … Read More
Opening Drive Play (CTSH)
CTSH gapped down from a close of 83 to 78 in the premarket. Intraday Fundamentals (From Barron”s) Shares of IT outsourcing firm Cognizant Technology Solutions (CTSH) are off $6.11, or 7.4%, at $76.10 after the company this morning despite beating Q1 estimates and forecasting the current quarter and the year above estimates. The drop is likely part of the broad-based weakness in IT … Read More
Increasing your confidence as a trader
So you see that a trader really can make it. He has stopped losing money, put up some good days, works hard, loves the work, and is bound to getting better. At this point I move to work on building his confidence. But how do you do this? The worst thing is to applaud a high P&L day. A good idea … Read More
9/11
Excerpt from One Good Trade