The JSE and finance forum for South Africa
General Category => Shares => Topic started by: Mr_Dividend on January 14, 2017, 03:17:44 pm
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https://vantagepointtrading.com/wp-content/uploads/2010/05/How-I-Made-2000000-in-the-Stock-Market.pdf
This book is frequently on the must read list of traders - well worth the read. Short book - takes a couple of hours to read at most.
What I found interesting:
How he did well when travelling, but not well when he had information overload
How he entered shares even after they had run pretty hard.
His very small stops - advantage of trend following?
Pretty much going all in on trades - 2-3 shares it seems.
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Really enjoyed reading that ;)
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When is part 2 coming out? How I lost the 2 million in the stock market, lol.
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Interesting. Thanks for that.
How much of it do you think was because he was in the middle of a bull market? I guess it got him out when the markets turned so you've got to give him some credit.
He didn't diversify much and often had over 30% in 1 share, sometimes even 100%, so it could easily have gone the other way.
Looks like he used quite a bit more Technical Analysis than Fundamental Analysis in making his decisions, I like that since I don't know how to read much into company reports/etc :)
Some software even includes a Darvas Box Indicator...
https://www.linnsoft.com/techind/darvas-box-dbox (https://www.linnsoft.com/techind/darvas-box-dbox)
This summarises his approach pretty well for me:
I shall not follow advisory services.
I shall be cautious of broker advice.
I shall ignore Wall Street sayings or truisms, no matter how ancient or revered.
I shall only trade stocks on major exchanges with adequate volume.
I shall not listen to (or trade off of) rumors or tips, no matter how well researched they may sound.
I will use a sound strategy instead of gamble…I must study this strategy (originally this approach was fundamental analysis, which didn’t work for him, so he developed his Darvas Box trading method).
I will hold one position for longer, as opposed to juggling a bunch of positions for a short period of time.
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Thanks Mr Dividend, good read.
The plain fact was that I was reading too much, trying to do too much.
That is why I rapidly reached the stage where I could read the
figures on the stock market quotations but they no longer told me
anything.
When I was abroad, I visited no boardrooms, talked to no one, received no telephone calls,
watched no ticker.
At 7 P.M. I start to work studying my daily telegram and deciding
what my future dealings will be.
It began to be a strange life. I sat in the Plaza every evening, reading my
telegram and filing it. There was nothing further I could do. I felt elated
and restless, but powerless. I was like a scientist who, after years of
work and research, has successfully launched a rocket to the moon, and
now as he tracks it climbing higher and higher he has a tremendous
sense of achievement and also a strange let down feeling of inactivity.
The answer this time was easy. It was the old tried and trusted answer: I
did not have any reason to sell a rising stock. I would just continue to
jog along with the trend, trailing my stop-loss behind me. As the trend
increased, I would buy more. If the trend reversed? I would, as ever,
flee like a disturbed burglar.
I was working while Wall Street slept.
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Doing his Block method - see if it works
NPN - 220000 / 210000
ANH - 150000 / 140000
PPC - 700 / 650
BIL - 25000 / 22500
ACL - 1600 / 1400
:laugh:
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Which brokers offer stop loss selling?
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No idea, some1 else will have to answer. I go thru broker, but it is self managed.