Planning Your Dive and Diving Your Plan ? Trading!

A colleague of mine just returned from a scuba diving trip in Cozumel, which just happens to be one of my favorite places to dive. Anyway, she was telling me about an unexpected difficulty she encountered while swimming around the corral reef down about 85 feet. It wasn't anything serious but her story reminded me of something my scuba instructor used to say over and over again. "Plan your dive, and dive your plan".

When you're down about 90 or 100 feet the nitrogen acts on your body in a way that's not too dissimilar to having one dry martini on an empty stomach. It's called Nitrogen Narcosis, Rapture of the Depths, or Martini's Law. So the thing to do is get your planning done while you have a clear head, (i.e. on the surface). And then when you're deep into it, and you're feeling a bit euphoric, or nervous, you don't have to make any decisions about 'what' to do. You just follow your plan.

This holds true for trading as well. When you're feeling the euphoria or nervousness set in, remember to follow your plan. And, uhm yeah,, also have a plan to follow. Clear heads will prevail.

Years ago I had the good fortune of talking with a trading guru for several hours. This individual is world renowned for his trading saavy and skill. What he elaborated in that conversation had a tremendous impact on me. HE said that when he learned how to trade that his family enforced only one rule that he had to follow. KNOW WHERE YOU ARE GOING TO GET OUT BEFORE YOU GET IN. He felt that the problem that most traders had was that they felt that this simplicity did not apply to them. I remember sitting and speaking with him and thinking about my own mistakes, primarily letting hope take over in my decision making.

Many traders think that crying "UNCLE" on a trade and taking a loss is unacceptable. Since that conversation I have taken numerous losses on trades but it's funny how they don't have the STING that they used to because I PLAN MY DIVE and DIVED MY PLAN.

This is really simple and incredibly workable. Apply it to your own trading and investing.

-Downjonesfully,

Harald Anderson
http://www.eOptionsTrader.com

Harald Anderson is the founder and Chief Analyst of eOptionsTrader.com a leading online resource of Options Trading Information. He writes regularly for financial publications on Risk Management and Trading Strategies. His goal in life is to become the kind of person that his dog already thinks he is. http://www.eOptionsTrader.com.

In The News:

This RSS feed URL is deprecated, please update. New URLs can be found in the footers at https://news.google.com/news

New York Times

Three Funds Find Routes to Top Performance in a Rough Market
New York Times
In the first quarter, as the S.&P. 500 sputtered to a 1.2 percent loss and many sectors sagged, the managers of three of the top-performing mutual funds scooted ahead by betting on growth stocks and Latin America. Christopher J. Bonavico, of the ...


Reuters.com

Consumer staples stocks face headwinds, says Shawn Cruz
Reuters.com
Reuters is the news and media division of Thomson Reuters. Thomson Reuters is the world's largest international multimedia news agency, providing investing news, world news, business news, technology news, headline news, small business news, news ...


CNBC

Indians are starting to ditch gold and property investments for stocks and mutual funds, survey shows
CNBC
Indians hold a relatively low percentage of their total wealth in financial assets but that trend might be changing, according to a recent Credit Suisse survey. The investment bank has released its latest version of a Emerging Consumer Survey that ...

and more »

Here's why small-cap stocks could be vulnerable to ETF outflows
MarketWatch
Exchange-traded funds are among the most popular ways for investors to get exposure to nearly any asset class, region, or strategy in global financial markets. However, rather than providing safety in numbers, this could become a risk factor for some ...

and more »

Investor's Business Daily

Trade-War Olive Branch Fuels Rise By Stocks In 'Best Mutual Funds'
Investor's Business Daily
Many individual investors and top stock mutual funds benefited. Take AB Large Cap Growth Fund (APGAX), a 2018 IBD Best Mutual Funds Award winner. The fund tacked on 0.35% on Monday as the S&P 500 gained 0.36%. All but one of the fund's 47 stocks were ...


Investorplace.com

Alibaba Group Holding Ltd Seems Like High-Risk Mutual Fund
Investorplace.com
Alibaba Group Holding Ltd (NYSE:BABA) stock has paused in recent months. A rise in geopolitical risk and a selloff in tech have lead investors to close positions in Alibaba stock. A low multiple and the company's high growth could attract many buyers ...
BABA Stock Quote and Analysis of Alibaba Group Holding Ltd - InvestorPlaceInvestorPlace
Alibaba Group Holding Limited - BABA - Stock Price Today - ZacksZacks
Free Report for BABA - Zacks.comZacks

all 176 news articles »

Investopedia (blog)

Introduction To Money Market Mutual Funds
Investopedia (blog)
You can purchase shares in money market mutual funds directly from brokerage companies or mutual fund firms, just as you would purchase shares in a stock or equity mutual fund. As investment advisors, some banks also sell money market funds and some ...


TheStreet.com

Mutual Fund Managers Love These Stocks and You Should Too
TheStreet.com
As the stock market continues in its ninth year of an impressive bull run, mutual funds have enjoyed stellar gains. In 2017, U.S. diversified stock mutual funds averaged a gain of 18.26%, just off the heels of the S&P 500's 22% gain last year. While ...
This unique mutual fund charges less than an index fund if it underperformsMarketWatch
Is Laudus US Large Cap Growth (LGILX) a Strong Mutual Fund Pick Right Now?Zacks.com

all 17 news articles »

Investopedia (blog)

Four Strategies For Managing A Portfolio Of Mutual Funds
Investopedia (blog)
This is the most commonly seen mutual-fund strategy. How does it work? Basically, if your portfolio does not boast a plan or structure, then it is likely that you are employing a wing-it strategy. If you are adding money to your portfolio today, how do ...


This week's Mutual Funds and ETF stories
MarketWatch
What if not everything, but the most important things, to know about a stock-market crash fit on a simple, single 3”x5” note card? Would this knowledge change how you invest? Some of us find that our fears dissolve when shown the facts, while others ...

and more »
Google News

Stock Investment Advice

Stock investment advice is easy to find. Do you get... Read More

Understanding Stock Market Indexes

A stock market index is a statistical measure of changes... Read More

Performance Funds

Mutual funds are doing more and more to discourage investors... Read More

Learn to Calculate a Stock?s Pivot Point

Stocks breakout from properly formed bases everyday but many investors... Read More

Getting Even

I know there are a lot of you out there... Read More

Valuation

Every day I hear from the "experts" on CNBC-TV and... Read More

Diversification

Wall Street's watchword has always been diversification, but what does... Read More

The Inside Scoop on Mutual Fund Rip Offs

The bear market that showed up at the end of... Read More

Good News?

As the man said, "I've got some good news and... Read More

An Old Proverb for Investing

"If you don't know where you are going, any road... Read More

Robert Rodriguez Weathers the Stock Market

Robert Rodriguez likes to buy stocks at their lows. When... Read More

Investment Research - The Dalbar Study

Very few people, even professionals, have heard of the Dalbar... Read More

Cash

How many people went to a cash position this week?... Read More

Play another Day

Money management starts with protecting your capital, realizing profits and... Read More

The Shadow

The Shadow knows. There used to be a radio program... Read More

What To Buy?

Now that you have some money burning a hole in... Read More

Rebalance And Diversify

The stock market has not been very kind to your... Read More

Trade Stocks for Real

I read a comment by a forum member on another... Read More

One Way Street

Ever turn down a street, get half way and suddenly... Read More

China Syndrome

There has been great condemnation recently because China has been... Read More

Again With the Bubbles?

A few years back ? it seems like an eternity... Read More

Eternal Sunshine

There is a current movie entitled "Eternal Sunshine of the... Read More

Financial Crime

Congress recently passed another new law that is supposed to... Read More

Why Technical Indicators

The fight continues to rage among traders who use technical... Read More

Hedge Funds

You read and hear a lot about hedge funds. Unfortunately,... Read More