Thank you for replying to this bunch of questions., page-6

  1. 2,271 Posts.
    I tend to agree with Eddie.

    I have not been trading for long compared with most of you guys, but the biggest mistake I have made so far is researching small caps and buying on fundamentals, when all my training was on t/a.
    I spent two years studying t/a, then time and again, I would study up a company which I believed could not fail, and was buying at the top of the market.
    I now truly believe that to buy stocks one has to buy them in a sector that is at lows and showing a definate upward trend technically.

    I ask myself "how often have I seen a great opportunity on fundamentals and raced in and bought before the mob" only to later study my charts and be trading against the trend in a sector that has seen a bubble burst. Whilst the trend on the individual stock may have looked ok, the big picture of the sector reflects more accurately the thoughs of the market. Frank Tubbs book "Stock market lessons" is an excellent read about a guy who traded this way many years ago. Although written in rather old dialogue it can be proven over and over again in today's market.

    In a bear market such as this, and with the benefit of hindsight, the charts have definatelly proven a far more reliable indicator than all the fundamental studies I have done.

    Don't get me wrong, I'm not whinging, I put all this down to apprenticeship fees and believe I am a much better trader for it. Where I believe I went wrong with stocks, is I started trading a year ago when there was a spike in mining and biotech stocks. For three months it was really hard NOT to make money and I guess I got sucked along in the flow and became complacent, forgetting the fundamentals I had been taught, seeing a substantial profit turn into a 10% loss before the light came on.

    At the same time my futures portfolio, traded soley on t/a, was fast approaching the 100% profit mark (since passed it). Now, how much did I have invested in each? I hope your sitting down, I had 25% invested in futures and 75% in stocks I couldn't seem to go wrong on.

    So there you have confessions of a guy who learned a fast and expensive lesson.

    Nice to hear other's thoughts on this thread.

    Bomber

    Pretty stupid stuff, and I have been warned by many good traders that the worst thing can happen to a new trader is enter the market at an easy stage, which I did.

    I guess my answer to your questions are "no" to all, for the above reasons.
 
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