This is my very first post on this blog.
In fact, this
is my very first post on any blog !
My reason for
starting a blog I hear you ask?
Well, I am a wannabe ‘trade for a living’ trader. I have read
countless books on the subject and work in a trading environment in the City of
London (not as a trader) but I could honestly think of nothing worse than
working 9 – 5, or even 8.30 – 6.30 in my case, for the rest of my life so I
need to find something else to do to make enough money to live on. And, I know
a bit about trading, I find it fascinating and I think there is great potential
to succeed. I have always wanted to do my own thing, go at it alone so to
speak. Whether it is starting a company of some sort, trading for a living,
writing books or developing property - all of which are currently in
consideration – and are being stress tested !
So getting back to why I started a blog, it is down to keeping an
online journal of my trades, the successes, the failures and general ups and
downs of trying to make money from trading, and hopefully one day, to make
enough money to finally give up my day job. That’s the plan anyway – let’s see
what happens. I will post an overall PNL on all my trades at the end of each
day so you can all keep track on how I’m doing. So a bit of a background on me
(for those who care – fell free to skip ahead).
As I said (or is it as I wrote!?) previously, I work in the City
of London on a trading floor but not as a trader. Giving away more than that is
probably not wise as I shouldn’t really be blogging from work, so let’s leave
it at that. I have years of experience in working for trading institutions but
precious little trading myself. I have probably read thirty books on the
subject; have dabbled in some shares here and there, made some money, lost some
money but never enough either way to make a difference to my life. So now after
putting this off for years, I am taking the plunge. I am investing £30k of my
own money and I am going to trade. And, best of all, I am going to keep track
on this blog, of what I bought, when and for how much and we will see what
happens.
So, £30k is not much to invest, I know. To be able to stop working
and trade for a living, I would need a substantially larger fund to invest or I
would have to probably triple my capital each year which would certainly be a
feat! If that does happen and someone from a hedge fund reads this, don’t
bother contacting me, I will be sitting on a beautiful beach somewhere, writing
my next blog post and smiling to myself and to the heavens above for how lucky
I am to be working for a hedge fund or any other institution in damp, grey and
cold London!
My strategy for achieving mind blowing results you ask?
The answer - speadbetting !
Highly geared – yes.
Highly volatile – yes.
Highly risky – yes.
Huge potential – yes !
Tax – no !
I reckon with £30k at my disposal, spreadbetting is the only way
really. I could invest in equities but with only £30k, I wouldn’t really earn
enough annually to get through a month without working, never mind quitting my
job. £30k is a lot of money, don’t get me wrong, I don’t have a lot of money. This
is many, many years of saving for me but it’s just not enough to generate
profits required to live on by trading stocks. I don’t know much at all about
trading forex, futures, options or any kind of derivative so I am going to
stick with what I know (limited as it may be) and spreadbet on equities. There
might be some beginners (more so than me) that don’t know anything about
spreadbetting and in future posts I will explain what it is all about, how it
works, what costs are involved and why it’s tax free but for now I am going to
state the rules I will stick to and which spreadbets I placed yesterday – yes
the ball is already rolling – and for how much each bet is.
All trades will be made on stocks listed on the London Stock Exchange (well so long anyway, I might branch out into other markets at some stage but am keen to focus on one market in initially)
I have opened a few accounts with various spreadbetting companies
in the UK. IG Index is probably the biggest and most well known and I have also
opened an account with City Trading, Capital Spreads and Finspreads. Reason
being - to get the best spread (more on this later). And now to the rules.
A trade must:
- Have less than £1200 at risk
- Have a default stop loss of 7%
- Have a default risk/reward ratio of 1:2
Portfolio must:
- Never have more than 18 trades at once
More on all of these later.
But now, for the actual trades I have made so far...see next post…
