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Author:Investa
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Trading is a time-consuming job that demands having to check the market for good entries and exits. Unfortunately, not all of us have the luxury of time. Some of us may be preoccupied with other things, such as day jobs, school work, chores, etc. The easy answer here is to go for the long term and to invest instead of trade. However, trading can still be feasible even with a busy schedule as long as you keep the following habits in mind.
Know your own time
As a first step, it’s important to know your own time, when you’re at your busiest, and when your free times are. This entails for you to plot when should you plan for the week’s investments and possibly analyze the market for the time being.
For example, weekdays are busy days and often are non-negotiable, however, weekends are free. Then you should allow a few hours of your day and look into the market!
Create a Plan
Now that you’ve set a time, create a plan. This includes analyzing and predicting your market. Given that you barely have the time, it’s important to already anticipate both the best and worst-case scenarios. Knowing at what price your entry and exit points are, as well as your cut loss, and scheduling it beforehand through your online broker is an easy way to do this.
Plotting all these in your notes or better yet, in an excel sheet could keep these organized and give you easy access to the plan you’ve made.
Download Apps (like Investa)
Lastly, maximize all the resources available to you and use an app to monitor your stocks! Investa has a watcher feature that could give you alerts every time a significant indicator is triggered or a certain price level is hit. This lessens the amount of time you constantly have to allot to trading while still getting its perks.
Time is indeed a trade-off, however, a few simple habits and techniques are the key to including trading in your schedules. After all, allotting just a few hours of your day and getting the returns that you expected are what make all the difference.
Despite the PSE visiting Chinatown last week, The Data Scientist was still an active and helpful member of the Investa community. The bears weren’t strong enough to pull The Data Scientist down as he is continuing to uplift members of the community, especially those who have red portfolios.
The Data Scientist supplements his uplifting attitude by sharing his insightful observations to the community. The Data Scientist is very proficient at identifying key support levels using Fibonacci Extensions, spotting potential price corrections, tracking oscillator movements, and extracting crucial information from indicators.
What sets The Data Scientist apart from other members is that his observations are newbie friendly, incorporating terminology lessons on every observation post. The Data Scientist also helped out @mattdoesntstop ‘s Sagip Trader Program by sharing his free lessons on his timeline. The program was held last weekend, aimed to aid those who have been caught in the dip last week by giving out free lessons on his discord channel.
The Data Scientist’s quick lessons about terminologies such as Book Value vs Market Value, and Cash Dividends and Stock Dividends, really help the members of the community eliminate confusion and be better traders. All of these help the community to stay optimistic and continue trading their way out of the rat race.
Stay strong to those who have been caught in the dip, and kudos to The Data Scientist a.k.a @datascience for sharing his observations, informative lessons, and motivational quotes. Your FREE 1-Month InvestaPRO is on its way!
People with a stable and good internet connection tends to work from home rather than working from the office. These are some people who want to work for some side hustle so that they will achieve their financial goals anytime in the future.
One thing they have discovered is that in the stock market, there are the living “Day Traders” where they trade in the market for a day from the opening of the market until the market closed. With the right amount of capital and side hustle scheduled, they can already trade in the market. But the real question is, are they really ready?
It is not easy to day trade without any system and discipline on yourself. With that let’s take a look with the 5 tips to become a successful Day Trader.
Risk Management
Risk comes from not knowing what you’re doing – Warren Buffet
In trading, we all know that you can’t control the market and you can’t control the number of participants who will participate in the market every day. You can’t even control the volatility that will happen on the market. To avoid being whipsawed by the market, you must control your risk in every trade. You must set for yourself a risk appetite that you are willing to risk per trade.
Control your psychological state so that when the market goes against you, you won’t be emotional because the market is just being abusive to you. Know your timing of entry and exit before trading the market so that you won’t get stopped out easily. When it comes to the risk reward ratio, always get a good risk reward ratio that will help you to be profitable in the long run. Always and always put a stop loss and follow that stop loss plan so that you won’t be dragged by the market.
Cut your emotions
When you get your profits, avoid being too happy and when you take your losses, avoid being too sad that will force you to quit trading. A good trader will always be a robot because they trade without the emotions and stay neutral as long as they are in the zone of trading the market. The only rule in emotions is to control it and think properly while trading the market.
It is not about the gains
In the market, it is not always about gains, it is about being consistent in your trading plan that will help you to survive in the market. Once you are in the mindset of focusing on the money not the trading plan. I imagine that you will be affected by the greed that will lead you to terrible decisions when trading. That is why always focus on your trading strategy, stick to it and follow it no matter what because you created it.
Follow your Plan
“He who fails to plan is planning to fail” -Winston Churchill
Now that you have a trading system then always follow it. All you need to do is to follow your plan and nothing else. Always have an entry and exit, control your psychological state and know your risk management techniques. This will help you to survive in the market as a day trader in the long run. In the end, if you follow your trading plan, you will be a profitable trader in the future.
Stay Disciplined
When you wake up in the morning what do you always do? Open your phone? Take a bath? Eat? Meditate? Or sleep again? The next action will help you to stay focused on the course for the entire day OR will make you do nothing for the whole day. Choose your decision well and stay disciplined on your routine. This also applies in the stock market.
Do you follow your trading plan consistently or do you break your rules when the market goes against you? It is your choice if you will stay consistent with your plan and become a successful person one day or trade and trade and trade like a machine gun without stop loss until your capital will become 0. Again, choose your decision well.
When we want to do things for a prolonged period of time, it is necessary that we take the appropriate amount of breaks at the appropriate times. But how exactly would a trader determine when to take a break when the markets trade for 5 days a week? Before we move on to the “when”, let us first discuss the “why”.
For starters, taking trading breaks is necessary for the long term sustainability of your trading. Let’s say that you are on a losing streak and you are trying to decide whether to take a break or not. On the one hand, taking a break for one week will let you evaluate your system.
On the other hand, continuing to trade despite your losing streak might be what you need in order to end the streak. Although continuing to trade might sound like a compelling option, there is a possibility that you’ll end up with more losses thereby by lowering your spirits which eventually leads to the end of your trading journey.
Journaling
Now that we have established the importance of taking breaks, let us discuss exactly when you should take breaks. It is worth noting that these tips are only possible through journaling or the act of recording your trades. You can use anything from Investajournal to simply using a notebook to record your trades as long as the journal contains your entry and exit prices as well as your entry and exit reasons. Now that we have our journal, we must discuss two important metrics: VAR (Value at Risk) and Exit Notes.
Value at Risk
Value at Risk (VAR) is actually a statistical measure used by financial institutions in order to determine the risk involved in a certain portfolio. However, in the context of retail trading, VAR pertains to the amount that you are risking relative to the size of our portfolio. So lets say that you have PHP 100,000 in your portfolio, 1 VAR is equal to PHP 1000. This means that if a trade involves the risk of losing PHP 1000, then you are risking 1 VAR.
So how can we use VAR to determine when to take a break? Well, it can be as easy as taking a break when you are down 10 VAR. This means that if your initial capital of PHP 100,000 has turned to PHP 90,000. This is the perfect time to take a break because it shows us that there is something wrong with our system. Losing 10% of your portfolio is not something that you should take lightly. This requires an evaluation of your system that usually entails virtual trading and continuous learning.
Another metric that you can use is if you lose 5 VAR in consecutive trades. So if your capital is PHP 100,000 and you raise it to PHP 120,000 but lost PHP 5000 in consecutive trades (net PHP 115,000), then maybe there’s something happening to the market that requires you to adjust your system. In summary, you can either take a break when you’re down a certain number of VAR from your capital (regardless of win/loss ratio) or you can take a break when you lose a certain number of VAR to consecutive trades.
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Exit Notes
Aside from the amount that we gain/lose, we also have to look at WHY we lost/gained money. Basically, if you are losing for the same reasons (e.g. failed breakout, whipsaw) then maybe you need to adjust your system in relation to that.
An example is adding Average True Range (ATR) to your system to avoid further whipsaws. It’s easy to say that you don’t need to take a break to adjust your system but in reality, you cannot be objective with your trading setup if you have open positions.
Conclusion
It does not matter if you are a beginner or an experienced trader, everyone goes through losing streaks. In the end, we have to remember that bouncing back from losing builds character which is the primary tool that we need in order to find success. However, you do not need (nor should you) bounce back right away. Oftentimes, a break is necessary in order in order to avoid making the same mistakes that brought us to our downfall in the first place.
It is indeed a Happy New Year for Sherlon who showed position entry masterclass with his $ACEN forecast 29 days ago. Sherlon caught an entry in the support levels at 6 pesos and eyed $ACEN’s bull run to its all time high at 10 pesos.
This is no lucky feat as Sherlon caught a retracement 5 days after his forecast, entering another position at 6.15. Sherlon hit his target earlier than expected, initially predicting that $ACEN will reach the 10 peso levels by mid January.
Sherlon’s mastery of the Fibonacci Retracement tool makes him a very lethal position trader and helpful contributor to the Investa community. He further demonstrates his mastery with his trades in $DITO and $MM, entering $DITO initially at 6.2 and buying additional stocks at 6.31 after waiting for its retracement from 6.48. Currently, $DITO is at 13.12, earning him roughly 111% gain in 1 month from a single trade.
For $MM, Sherlon was able to catch a lower wick at 5.33 before the stock shot up to 6.25 where he intended to take profit. Sherlon really has an eye for entries, going into trades with extreme precision and always hitting the bottom of dips.
The nice thing about Sherlon’s trading style is that he always enters the bottom of the dip, levels where the price is unlikely to go further downwards. Of course, for the purpose of protecting against bear runs, Sherlon sets his stop loss right below the support level or fibonacci retracement level that he entered. This is why Sherlon rarely gets his stop loss triggered.
Sherlon is a patient trader, always waiting for the next entry in his charts. He is an excellent model trader especially for beginners, focusing on foundations of risk management and positioning. Besides the Fibonacci Retracement, Sherlon is also adept at using EMA 20, 50, and 200.
Using the EMA 200 as long term support and an indicator for a potential entry. There is not much to say about his trading style as he is a straightforward trader who likes to keep it simple, buy the dip and sell the rip.
Congratulations to those who were able to profit from breakouts of $ACEN, $DITO, and $MM, it’s a nice way to start your year. Kudos to Sherlon a.k.a Sherlo2075 for sharing his analysis. Your FREE 1-Month InvestaPRO is on its way.
LEARN ABOUT PROFITABLE TRADING STRATEGIES STRAIGHT FROM TOP TRADERS OF THE COUNTRY.
We have been there, staring at our credit card bill and being overwhelmed by the sums of debt we have accumulated, the interest that comes along with it, and the credit terms pressuring you to pay by a specific date as if you have not enough deadlines in your life.
The worst part about debt is that it keeps us from reaching our goals, the more of it that we have, the farther away we are from our dreams and our financial freedom. D2ealing with debt is exhausting and stressful, but it does not have to take forever to pay off.
CONTENT:
What is debt
How debt keeps you from reaching your goals
Stigma of debt
Debt as a prison
TL;DR
Mind the gap (fix budget)
○ Increasing Revenues
○ Decreasing Expenses
Avoid Credit Card spending
○ Deleting Cards from Online Stores
Reward yourself (with cash you have!)
Methods
Avalanche Method
Snowball Method
Conclusion
What method do we recommend?
Recap on the tips
The first thing we have to do to pay off our debt is to mind the gap. This is the gap between your monthly income to your monthly spending. Having a tighter gap leaves you less room for financial flexibility, that is why there must always be a significant gap between your income and expenses. There are two ways to increase the gap, either you increase your income or you decrease your expenses. Managing to do both would be the best thing you can do.
By making the gap bigger, you can make enough room to pay for your debt in a shorter period. Try to think of anything that can help increase your gap, brew your coffee at home, prepare your own meals, eat out less, or maybe sell those old guitars you do not use anymore, anything would make a big impact.
Next, we have to avoid credit card spending at all costs. It would not help acquiring more debt if you cannot pay off your current ones. Delete your credit card information from your favorite online stores, remove it from your internet browser, delete Shopee and Lazada from your phone, or even go as far as cutting your credit card.
It may seem like a punishment to you, but being free from debt is better than being stuck in a loop of acquiring debt and draining yourself to pay them off. Once we have established your gap and preventing further debts, we can now move on to strategies that we can use to be finally free of debt.
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The Avalanche approach is the quickest and cheapest way of paying off your debt. You simply have to list down your debts from the greatest amount to the least, and pay the biggest debt first. This makes it so that you minimize the interest you have to pay by eliminating the biggest amount as quickly as possible, and after paying off the greatest amount, you can use the additional cash flow from paying off that debt to easily pay off the following amount, and so on. As simple as it may sound, the Avalanche approach is easier said than done.
This method makes it hard to start since you are dealing with the greatest amount first. Moreover, it is usually demotivating for you since you do not see results immediately. As humans, we love to see results quickly and not being able to get the results we want can be overwhelming. That is why in the next approach, we will be using human psychology to our advantage!
The Snowball approach is perhaps the more effective method of paying off your debt. It is the opposite of the Avalanche approach, wherein we pay off the smallest amount first. This makes sure that we feel motivated everytime we scratch debt off our credit card bill. Even though this is not the cheapest method of paying off that debt, allowing the bank to squeeze a little extra interest from us, this method is more likely to keep you in track to your debt free life which, after all, is our goal.
In sum, we recommend that you start off small and pay the smallest debt using the snowball approach. Always remember to mind your gap, the greater the gap, the faster you’ll be able to be debt free. Avoid acquiring additional debt from the ones that you already have and finally, make sure that you are always on track. Do not forget to reward yourself every now and then, you deserve it. Paying off debt is not an easy thing to do.
If you are reading this article chances are you think you are too young to invest. You also probably think that you do not have enough money and that you lack the necessary business skills needed for investing. The truth is, most people need investing as a way to safeguard their future.
For those of who are still on the fence, it is important to remember that your investing journey does not start with your first deposit, it starts with your first initiative to learn about investing. But why exactly do we need to invest and if ever, how can we start?
First Reason to Invest: Compounding Interest
There are two main reasons to invest at a young age. The first one is compounding interest. The earlier you start investing the more your funds accumulate. Investing is all about making your money work for you and the sooner your money works, the sooner it multiplies to create more money which will in turn create money thereby creating an endless cycle of wealth creation.
For example, If we assume a starting capital of PHP 10,000 and a compounding interest rate of 4% per annum and let’s assume that you start at age 25, by age 70 your investment will be worth PHP 58,412 amount. However if you keep the interest rate and the starting capital constant but instead start at age 15 your investment will be worth PHP 86,464 once you reach 70. Of course this is an oversimplification and you probably won’t have the same funds when you are 15 and when you are 25 years old but try it out for yourself with values that you think are realistic.
Second Reason to Invest: Risk
The second reason is your ability to take risks. Adults typically don’t have the appetite for risky investments the same way young people do because adults have responsibilities to their family. Therefore, by the time someone starts a family, a person’s investment philosophy should be about safeguarding the future and capital protection as opposed to significantly multiplying their net worth.
On the other hand, you being young, can take on more opportunities with your desired amount of risk with minimal downside. With this, you are more likely to learn from your mistakes earlier and start being profitable earlier.
How to Start Investing
So how exactly can you start investing? You don’t have to go to Business School, you don’t even need to go to college to invest. In the digital age all it takes is 20 seconds. All it takes is 20 seconds to follow people in the finance world on Facebook, Twitter and on YouTube. This seems like a small thing but when you see finance on your timeline, it encourages you to learn more about finance and investing. In a way, you’re planting these small ideas into your mind which will eventually turn into your drive; into your passion for investing.
But let’s say you want something more actionable, what can you do? One of the most practical things that someone can do is to allot a certain amount of time to learn about investing. This can be done an hour per week or an hour per day; it depends on your schedule and how quickly you want to learn about investing. All you need to do is to look up basic terms like “interest rates”, “investing”, “capital”, and “compounding interest” and eventually, you will never run out of things to look up.
However it is important to have savings before applying your learnings on investing. Being young does not give you an excuse to be reckless. You still have to employ risk management strategies as well as to have a “cushion” just in case your investment doesn’t go as planned.
if you still don’t know where to start you can head on to InvestaUniversity, a free stock market program filled with activities, a welcoming community, and instructional videos all geared towards helping you make that first investment and eventually, financial freedom.
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