Finance Trends Letter

7 Keys to Trading in the Zone , from author Mark Douglas . "I am a consistent winner because: 1 . I objectively define my edges. 2 . I predefine the risk of every trade. 3 . I completely accept the risk or I am willing to let go of the trade. 4 . I act on my edges without reservation or hesitation. 5 . I pay myself as the market makes money available to me. 6 . I continually monitor my susceptibility for making errors. 7 . I understand the absolute necessity of these principles of consistent success and, therefore, I never violate them." This post was originally shared on Twitter (and retweeted by StockTwits to a wider audience) in September 2015. Mark Douglas on Trading in the Zone ( #quotes via @goodreads ). pic.twitter.com/q6qyk6TQhA — Finance Trends (@FinanceTrends) September 15, 2015 Check out the related posts below for more winning trading psychology from Mark Douglas and friends. You will profit from these insights , if you apply the...

When I scan the US stock market lately, it seems like nearly every stock or ETF is undergoing a sharp correction or in the process of topping out. And that's leaving aside the groups, like mining and oil and gas stocks, that have been sinking like a stone for over a year or more. So it really shouldn't come as much surprise that the few stocks holding up in this volatile, declining market are the defensive names. Cigarette makers and electric utilities, for example. Stocks like Philip Morris ( PM ), Altria ( MO ), American Electric Power ( AEP ), Southern Company ( SO ), and Consolidated Edison ( ED ). Among the stocks holding up well in this decline: cigarettes and utilities. $RAI $MO $SO $XEL $CMS $ED — Finance Trends (@FinanceTrends) January 19, 2016 Some charts to go w/ that last tweet. Cigarettes + utilities bucking the market's weak trend. $MO $SO $ED pic.twitter.com/w1AWudxTGB — Finance Trends (@FinanceTrends) January 19, 2016   There...

Greetings, friends and readers from across the globe! The New Year is well underway and with it, a pronounced sell-off in global share markets.  So what can we do to protect our mental capital and our financial capital in fast declining markets like these? Let's take a quick look around the world's markets and then I'll share some thoughts on the importance of playing defense in this environment. We began 2016 with one of the worst starts on record for the US stock market. The S&P 500's market valuation plunged by over $1 trillion , erasing the combined equivalent value of tech giants Google ( GOOGL ), Facebook ( FB ), Intel ( INTC ), Netflix ( NFLX ), and Yahoo ( YHOO ). Meanwhile, the Financial Times reported that $2.3 trillion in value had been "sliced from companies across the globe" in the first trading week of the year. The damage was widespread: "...An analysis of more than 6,000 global stocks by the Financial Times showed more ...

Michael Lewis talks his (then new) book, The Big Short on C-Span back in 2010: "If I explain this to people, they're going to be outraged.". Watch it here. Having recently seen the film version of The Big Short in the theater, I've been going back to some of the interviews and source materials from Lewis' book. For those who don't remember (or are too young to recall), Lewis' book examines the real estate bubble and subprime mortgage debacle, which kick-started the 2007-2008 financial crisis and pushed our economy to the brink of collapse.  The book zeroes in on some of the investors and hedge funds that profited greatly from buying credit default swaps (CDS) on subprime bonds, and the banks who took the other side of that bet and crashed. A few years and a few trillion dollars in bailout money later, we're into a major motion picture starring Christian Bale and Steve Carell as said hedge fund managers, but that's a story for next time. T...

As we head into a new year and prepare to leave the old one behind, it's natural to reflect on the challenges and opportunities we'll encounter on the road ahead. Looking back on 2015, it was a tough year in the stock market for retail and professional investors. In fact, hedge fund returns were so poor that many funds have simply shut down or converted to family offices . So who did well in this challenging market environment? As the Journal points out, " A Bold Few Traders Earned Billions Flouting Rivals ", and conventional wisdom. By steering clear of consensus bets on oil, energy stocks, junk bonds, Apple shares, and currencies, a few skilled hedge fund managers were able to structure their own winning trades and prosper as their rivals faltered.  Which brings us to our lesson on trading and the ever-changing nature of capital markets. Here's what S&P futures trader and "Market Wizard", Marty Schwartz told aspiring traders at Amherst Colle...

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It's really easy to get bogged down in the filthy muck of everyday life. Believe me , I know. Plus, the holiday season can be an especially stressful time for anyone . Sometimes we are so focused on being down and out that it takes a great deal of effort just to look up and smile. So as we get ready to celebrate the Thanksgiving holiday in America, I wanted to share some positive thoughts with you.  Thankfulness, via Open Doors . These 21 quotes on gratitude, sharing, and thankfulness are among the best I've found. They are gathered here for you. Enjoy the quotes and the lessons in their timeless wisdom. "If you are really thankful, what do you do? You share." - W. Clement Stone "I am grateful for what I am and have. My thanksgiving is perpetual. It is surprising how contented one can be with nothing definite - only a sense of existence." - Henry David Thoreau "To give thanks in solitude is enough. Thanksgiving has wings and...