First posted 08/12/09
LINKS NOT WORKING. HAVE TO GO FOR A DRINK NOW BUT WILL FIX TOMORROW.
I have placed my first trades, in Feb 2010 Gold (for those new to all this, this means I have effectively bet on the price of a future, one that you buy today in order to have your gold delivered in Feb 2010).
The first was a proper trade: I have risked 1% of trading capital, and plan to hold the trade for days or weeks. Details are here.
The second was an experiment. It was a small trade designed to make a profit in a few minutes. I risked a few hundredths of 1% of trading capital and made £102 in just over 10 minutes. I am planning to experiment with this type of trade a bit more, but very cautiously. Day trading, as it is called, is a difficult business and one at which few people make any money in the long run. Details are here.
Most people dislike cutting losses — they wait for the trade to come back into profit. This is a mistake, because it might be that it will never do so. I have found in the past that I have a strong desire to cut losses quickly, and I had it again today. This is encouraging because it means I am less likely to make the classic error of holding too long, but I need to keep it under control — I lost a few hundred pounds on the larger gold trade and was thinking about cutting. I was also encouraged that I acted very quickly to get into the smaller trade, and took profits in a disciplined way after the price had run through my target.