Friday, December 14, 2007

Weekly Positions Update - 12/16/07

Yesterday I pounded through a great read, Winner Take All: A Top Commodity Trader Tells It Like It Is, by William R. Gallacher. I'll gather my thoughts and post what I took away shortly.

Overall on the portfolio side, I'm sure you notice some major changes from about a month ago (when things were running quite reckless and out of control). I am doing my best to reform my old ways - here's how I'm currently approaching things:
  1. Since we're in a flat out bull market for commodities, I'm buying anything that hits a 20-day high. Anything. Could be crude oil, feeder cattle, or sugar - doesn't matter. Everything goes higher in a bull market, so I'm letting the market sift these out rather than me buying and holding something - which I have been doing.
  2. If a current position hits a 20-day low, I sell. Again, no questions asked. I'll re-enter the position on a new 20-day high. Easy - automates the exiting process.
  3. Not have more than 25-30% of the portfolio "at-risk" at any given moment. In other words, if the world went to hell in a handbasket in 0.001 seconds flat, here's what I would lose.
    1. I'm working on a spreadsheet to calculate this, which I am still tinkering with. I'll share when finished. Basically the idea is that I have trailing stops at the 20-day low of each position. The difference between the current price and the stop (times the amount of leverage) equals how much I can lose on that position.
  4. The new return goal is 2% per week. If I break this, great. The idea is to try not to lose money in a given week. I figure if I can hit this # approximately, the returns will be great. Helps me to focus on the weekly # rather than trying to triple my portfolio in a year (which is what 2% will do over 52 weeks)
This week in the market, we've seen a big rally in the softs and the grains. My entry method put me into corn and soybeans a couple of weeks ago, and I am thankful for it this week. How about that to instill some confidence! Sugar is also showing some life - nice to have you back, sugar!

Date Position Qty Month/Yr Contract Strike Call/Put Entry Price Last Price Profit/Loss
12/07/07 Long 1 MAR 08 Corn 415 438 1/4 $1,162.50
12/14/07 Long 1 MAR 08 Corn 439 438 1/4 ($37.50)
11/09/07 Long 1 MAR 08 Coffee 'C' 126.05 133.80 $2,906.25
11/28/07 Long 1 JAN 08 Rough Rice 13.080 13.125 $90.00
11/28/07 Long 1 MAR 08 Soybeans 1108 1175 $3,350.00
06/04/07 Long 2 JUL 08 Sugar #11 10.05 10.84 $1,769.60
08/01/07 Long 1 JUL 08 Sugar #11 10.48 10.84 $403.20
10/18/06 Long 1 JUL 08 Sugar #11 12.08 10.84 ($1,388.80)
Net Profit/Loss On Open Positions: $8,255.25

Current Cash Balance $58,796.45
Open Trade Equity $8,255.25
Total Equity $67,051.70
Long Option Value $0.00
Short Option Value $0.00
Net Liquidating Value $67,051.70

Cashed out: $5,000.00
Total value: $72,051.70

Weekly return: 12.75%

1 comment:

Peehu Sharma said...

India cannot put the entire blame on the global environment for its poor export performance, according to a Crisil study.
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