This post is another in my series of “no frills” explanations. In each post I try to explain, in simple term, basic concepts that I think are useful to know about for trading and investing. You may have heard the term Yield Curve Control used recently as one of central banks’ tools in their arsenal. If you haven’t read my post on money printing / quantitative easing then I suggest you do, as it is closely related to Yield Curve Control. Last week saw bond yields go into overdrive. In particular the 10-Year Treasuries closed at over 1.5% – their highest since before the COVID-19 crisis. The imp ..read more

This market roundup briefly summarises my own views on the key takeaways from the prior month. Below is a table detailing some of the key instruments and macro indicators that I track. At the end of the post I’ve included a high-level overview of my key portfolio allocation changes. None of this should be construed as advice or a recommendation. This is my first post of this sort and considering making it a regular update, so would be grateful for any feedback! Monthly market roundup Key points: The bond market took a hammering with 10-year treasury yields rising to over 1.5% – their highest ..read more

I’ve seen a lot of discussion recently on Twitter about how people are planning on trading the US Election, come 3 Nov. I wanted to draft a short post to discuss my own approach, as I think there are serious risks of getting this wrong. I’ll also take this opportunity to lay out some of my other thoughts about how I will approach longer term investing positions. As ever, this is not advice or a recommendation. I’m just describing my approach to this. Whatever you choose to do is up to you and you alone. So, how am I planning on trading the US election? In short… I’m not. Trading positions – I ..read more

This post is intended to lay out, at at high level, the core elements that I believe are required for a high performing trading system. This article is effectively a “meta-post”. I will cover some key points off at a high-level, but the intention is to link to detailed articles, many that are not yet written, in order to elaborate further on each element over time. Importantly, each of these elements should have a “standard” which is written down. Often this is referred to as a trading plan. Effectively a set of rules on how you should enter, manage and exit your trades. If you don’t have a st ..read more

In the early days of trading people can get a little obsessed by the risk to reward ratio for their trades. I know from personal experience. The argument, quite seductively, goes something along the lines of this: “I only win about 30% of my trades. However, because I target a risk to reward ratio of 1:5 I can still lose 7 times out of 10 and still come out profitable”. In other words, if I risk $100 on each trade, over 10 trades: I would lose $100 x 7 trades = $700 But I would make $100 x 5 x 3 trades = $1,500 Total profit = $800 Easy money! Whilst the above example is technically fine, and ..read more

If you speak to many experienced traders, they will typically all agree on the importance of keeping a trading journal. And it’s something, by the way, I agree is super important too. However, in my experience, people tend to seriously over-engineer trading journals, to their detriment. I think it was Dr. Elder who said “Show me a trader with good records and I’ll show you a good trader”. Whilst this is true to a degree, I think many take this to an extreme. We’ll explore what I believe are some of the critical elements of a trading journal and how deconstructing yours can save time and lead t ..read more

This post is the first in a series of “no frills” explanations. In each post of this series I will try to explain, in simple term, basic concepts that I think are useful to know about for trading and investing. I will start with money printing as it is frequently talked about, particularly at the moment. So, what is “money printing” all about? What Money Printing is NOT Despite the name, “money printing” these days does not refer to the physical creating notes and coins. Actually, most of the money supply is not physical cash but is electronic (e.g. your bank account balance). “Money printing ..read more

A common question I get asked by other traders is “what time frame do you trade?”. Actually, I was asked this question by someone earlier today, which inspired me to write this post. In my early days of trading, I’m not sure I could have answered this question accurately. Reason being, I used to flip seemingly randomly between time frames until I found an entry that “looked good”. Inevitably, as you would probably guess, this was a road to disaster as I was unable to develop a repeatable approach. It was effectively another factor inhibiting standardisation of my system. The time frame you ult ..read more

We have witnessed a truly breathtaking rally over the last few weeks. I’m not sure there has ever, in recent times, been such a disconnect between the stock market and the real economy. Certainly not in my lifetime. Although technically you can argue we are in a new “bull market”, I’ve seen nothing to convince me that we are not in a bear market rally. Albeit an incredibly powerful one. This week we saw a sharp correction to the recent bull run. The S&P 500 dropped 6% on Thursday (11 June 2020). And that was on the day the Fed consensus showed they believed that rates would stay near zero ..read more

All traders want to ensure they have the best system at their disposal to give them a long term “edge”. For the most part, when you have a proven system that gives you an edge, you want to leave it alone to do the hard work for you. However, markets are constantly evolving and no system is perfect. Therefore, keeping your system the same for ever and a day is not really an option. A proportion of your time should be spent working on improving your trading system (or systems). However, the way you go about making changes to your trading system can have pretty dire consequences, if not executed ..read more