Tuesday, January 27, 2009

"Hot Stove" number

We have been reading and seeing that this market is giving us opportunities to make money.  However these opportunities are not bundled in the same way that they were in September - November 2008.

We have blogged about the following:


  • stock specific action


    • as a side note to this: we saw ESI was great to trade on Monday January 26th, but APOL/CECO/COCO were tough

  • being selective and taking what the market gives you

  • paying attention to index and stock technical levels

  • being patient:


    • trade like a cheetah  (SMB Training)

    • trade like a sniper  (Dr. Brett Steenbarger)



We discussed the concept of a "hot stove number."  I am referring to how many times a child will touch a hot stove before he realizes he should no longer touch it.  If you are trading a specific name/style/# of decisions/direction and it is not paying you...how many times will you try it in a day/week/month before you back off?  Develop a hot stove number.   

************************************************************************************************************************************************

In an unrelated side note, for those of you who saw "The Wrestler" or plan on seeing it, it is a total rip off of the documentary "Beyond the Mat."  I can not believe it has not been mentioned anywhere that I know of. 



0 comments: