Homework

I remember that when I was a kid, I was never a homework fanatic.  There was always something else to do that was certainly more fun and memorable.  I can honestly say that now that I am a little bit older, I view my homework in quite a different way, especially with trading.

Homework is necessary every night and especially every day before the trading begins. When it comes to investing, who do you rely on to do your homework?  I remember that I would spend 15 minutes every year reviewing the single page summary sheet of the various Fund returns, in order to make a selection for how I would divide up my 401K account.  That was it!  Unbelievable.

Now I do my homework every night, so that I can review the trade day in the morning, set my targets and plan at the beginning of the day and then watch, modify (if necessary) and execute the plan.  It can be a fair amount of work, but it makes the execution of a trade significantly easier and a lot less stressful because if I get into a trade, I have done the work to know why I got into the trade and have waited for that specific scenario to get into a trade.  I am no longer reacting to stale pricing data, but rather acting from my plan and a position of expectation.

Trading is not hard, but it is work.  The only magic to trading is to make your current perceptions and paradigms disapear so that you can actually learn.

Doing my homework and creating a plan to trade with gave me my single largest profit day this week and two other profitable days to make three for three this week.  I am having a blast doing it.  In fact, for those who know me, they would be shocked to know that I would rather do my homework, and plan for trading and actually trade than I would rather go golfing!

P.S.  I gave my golf cart away.