Pailin's Trading Corner

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stevy
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thanks pailin

thanks pailin - i was hoping you would make your own thread

sp001
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whr the hell is atlee   old

whr the hell is atlee

old sp, now sp001

anyways anyone still playing equities game? shorts, r u hiding, i continue to short it and go long gold. i honestly don't have the guts or trading experience to mess with paper silver right now. it's too nuts for me lately!

btw nothing wrong with being  a "cheap bastard" but it is the wrong description in my opinion. people who are "cheap" r simply those who value their time more than working as a slave to pay off a luxury good! that being said 50% savings is damn impressive! i only have 55% after taxes are all paid!  

pailin
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who are you doing this for?

Dr G wrote:

As an aside, who are you doing this for then?

Me and the missus.

When I was laid off last October, I didn't bat an eye. It's not the first time it's happened to me. Being in financial services, it's been a cycle every 6-8 yrs that I've "enjoyed". So I've been preparing accordingly for a long time. I'm debt free and rent. The salary was just funding further savings anyway, and too much of it was a donation to Uncle Sam. I won't miss giving at the office :)

My monthly cost of living is 1/10th of 1% of my net worth. I'm actually actively working at all times to reduce my COI footprint even further. Since nearly all my savings is inflation-hedged, I'm -in broad terms- good to go for the next 90 yrs w/o being productive.
Except I'm too young to sit around doing nothing. I also miss the office interaction, though not the politics. My plan was always to be able to walk away at any time the BS wasn't worth the paycheck. TPTB just beat me to the decision, that's all :)

Right now, their plan is that I'm supposed to be up to my ears in debt and all vulnerable to swapping the last bit of integrity and self-respect (not to mention freedeom) I have to vote in the next group of connected politicians and their dripping tit of handouts.

Too bad I stepped outside their plan.

So I'm here trading and building my own side business. Both are modest endeavors that tend to support paying the bills vs. upgrading my economic caste. Both are also in service of transitioning out of NE to TX. Better place to be (for me), whether things just get really bad or go Mad Max. I lack self-sufficiency in the lead and land dept.

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To the intelligent man or woman, life appears infinitely mysterious, but the stupid have an answer for everything. -Edward Abbey

freeboundary
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Can't be more grateful for your insights

Hi Pailin, I have been avid follower of your trading ideas, and lately your postings have been my main reason of visiting Turd's blog :-).  Look forward to learn from your brilliant insights, and am hoping to build up trading strategies utilizing your ideas.. Thanks a million again and please keep up the good work and guild us to survive in this tough trading arena:) 

JoeKa
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Nice thread Pailin

Good going Pailin. Interesting to learn more about you...thanks for being open.

I'm also thinkin of starting my own 'thread' called: "Nightshift with JoeKa"

Not sure if i'll be talking to myself...which happens quite a lot on the deep late show.

z28
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Thanks

Your posts are a great help .Thank you

pailin
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freeboundary & Pailin's Rules

Thanks for the appreciation. Now is a good time to mention a few basic Pailin "rules".

1. All things in moderation (don't overleverage, never go "all in" - EVER).

2. My economic circumstances and trading goals are likely very different from everybody else's. Keep this in mind if you track my trades with your own money, as opposed to watching from the sidelines and laughing when I lose :)

3. Cover your backside. Watch your risk, losing less is more important than "maybe" making a whole lotta. You never know when your supply line to easy fiat (jobs, bank loans, friends to borrow from, etc.) will dry up.  If you've traded away all your fiat to losses and don't have any physical or other net assets, you're now vulnerable to the dripping tit. You don't want that! A lot of my strategy pre-supposes a long core of physical or PSLV-type equity and double-longing it with paper in a bull trend or shorting paper to hedge that core in a bear trend. Resistance points and use of stops are an essential part of my trades.

4. If there's no obvious trend, there's no obvious trade. Good time to step away and pretend to do your job (if you have one) so you'll get a bonus year-end, or go outside and live a little (cheaply, of course!) You should already have physical, so you're never out of the trade...you're LONG.

5. Short charts are great for short term trades, never forget to watch the longer charts too. Right now, I'd rather get caught buying poorly at 33 than 37. Why? Risk vs. Reward. Risk? 30-32. Reward? 35-37. Look at the 4hr and 8hr Bollinger bands, recent resistance and those two prices...see what I mean?

I'm sure I'll think of more, but the above is a start. When I post trades, I'll try hard to provide relative context for the upside, downside, and size of trade I'm attempting. I don't enter these things to lose fiat, but sometimes I have a different goal in mind too (like shorting to hedge off-market physical long).

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To the intelligent man or woman, life appears infinitely mysterious, but the stupid have an answer for everything. -Edward Abbey

Devise
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I will give those cold

I will give those cold showers a try. Wife can't be convinced though.

Silver, gold and oil rolling down. Choppy action today. 

pailin
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cold showers

Devise, if wifey is working and bringing home more than the cost of those hot showers...you're net positive. Her happiness is an acceptable cost of doing business, an investment that yields returns. Another Pailin rule - keep the workers working, even if it means you have to pay them a little more :)

Now, if she's not earning just consuming... Just kidding!

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sp001
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mind me asking how you are

mind me asking how you are allocated asset-wise in broad terms?

my savings are going more and more into cash. ultimately (within next 5 yrs) i will prob take out alot of the money to open my own business.

but i literally started saving 3 years ago when i first got a real job (before was still in post-grad education mode)...since then i keep accumulating cash. i'm in 30% short-term bonds/TIPS (which is 100% of my solo 401k which i manage), but don't feel comfortable putting much into equities (think they are too expensive), or more than 20% in PM (including physical and paper combined). this typically leaves me with 50-60% cash at all times which drives me crazy! i'm still renting but will not buy b/c valuations whr i live are too much.

anyways point is pailin, u seemed to have saved a good deal and i'm interested in how u got to this point! any help is appreciated...at the end of the day, i don't expect trading to really do much to make me money but investing, on the other hand, could make a major difference. i'd be ecstatic with 10% annualized over a decade!

freeboundary
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Thanks

Thanks for detailed guide line, Pailin. Apologies for my bad manner. I have also been in financial service industry for years and middle aged. I can’t be more envious of you to be self-employed. Unfortunately, I am not yet laid-off and I just can’t just walk away from my job until I build full confidence in my trading skill. I  have no debt, living with wife with no children and accumulated saving enough to survive years.  Alright, enough of humble background and here is what I am doing now with silver:

Done some statistical analysis based on you idea and history tells that best strategy with silver right now is perhaps shorting silver during NYSE hours: going short around 9-10AM and covering around 4PM. Been experimenting this since yesterday with very small stake: barely flat yesterday as I closed the position at 7:30 this morning and having good start today. Went  short silver@35.5 and gold@1527.  

islandhopper
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35?

What do y'all think - does this downdraft have enough steam to push us through 35 or are we bouncing?

At the rate it's moving, I think we'll have our answer soon enough..

If we do break 35, bounce off 34.4 would be my best guess - though I see a bounce off 35.

rishi
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JoeKa

Joe

it would be a great idea if you set up a similar thread yourself - JoeKa's Trading Corner.

We can stay updated on what positions you and pailin are taking.

Btw there is descending trendline resistance + significant fib resistance at $36 ; posting late about it but looked

like a good shorting zone

Kiwi
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Trading Corner

@ JoeKa

Good to see you still around....what a big annoyed looking face!

Yeah, I think a JoeKa trading corner/nightshift thread would be cool, but never, never a Kiwi Trading Corner, it would read as a comedy (or a tragedy)

My latest adventure in losing money was buying into the Pandora IPO, I set my stops too low (to avoid being taken out by downward spikes, I told myself) and ended up with a few tears and a big chunk of change gone.....ugh.

But as they say, "the only real loss is when you don't learn", from now on it's tight stops and don't sweat the "lost potential profit".....lost potential profit hurts a lot less than real $ loss.

Sigh.

pailin
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asset allocations

You're correct, I have saved a lot. But know too that I've been saving at least moderately for 20 yrs and heavily for 15. Also, know that I've foregone many pleasures that my friends and peers have not. Including the "pleasure" of being in an upside-down mortgage that REQUIRES two full-time incomes to maintain.  No thanks :)

I've taken a lot of sh!t from everybody in my life for many years for my frugality, non-traditional investments, and cautious nature. Only the present missus (and likely final one) "gets" it, though I get the raised eyebrow even from her at times. She's a keeper. When I refer to myself as a "cheap b@stard", I take great pride in it. I'm old enough to know myself now, and know that I'm not going to change much either. Improve yes, change no.

At present, I'm 5% short term bonds, 15% cash, 10% physical/PSLV, 70% art. I'm slowly rebalancing from art which has some liquidity, valuation and storage concerns vs. cash and physical. I'm ok on silver, need more gold - physical and PHYS (for captive retirement funds). It's always a process.

Accumulation is your greater strength. But what to do with it? Cash is very dangerous. The only reason my allocation is currently so high is because I don't have income (unemployed) and I'm open to another 2008 deflation in everything w/o QE3. This is cash in hand. I do not know how far The Bernank (and good buddy Timmuh) will let things go. Not keeping any cash in the banks, too bad for them they won't be able to fractionally reserve against me :)

I deposit cash as need to pay specific bills online and otherwise maintain $10 balance to keep the no-fees acct open.

If I was not worried about deflation in near-term and had salary, I would be no more than 3% cash myself. DYODD on that.

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pailin
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JoeKa

I'd love to see an overnight action corner. Reading JoeKa's on-the-ground insight (read as catchup during "my" ET am hours) was always part of my daily strategy planning on the old site.

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To the intelligent man or woman, life appears infinitely mysterious, but the stupid have an answer for everything. -Edward Abbey

pailin
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35+ area

For the record, I've got no feeling on 35/36, totally neutral.

34s, I pay attention for a waterfall to blow some stop/losses out. 37s, I "might" put on a short. But I'd be iffy on it.

Right now, I'm gearing up to start putting on some longs in the low 30s. Not necessarily day trades, more of building a line that I'll have a generous trailing stop on when it goes green. A line I'd ride into the 40s. Not yet though, still too early in season..think July-August.

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To the intelligent man or woman, life appears infinitely mysterious, but the stupid have an answer for everything. -Edward Abbey

zopilote
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Thanks for Pailin's Trading Corner

I've been lurking since March.  Got burned by AGQ in May and have had to step back and learn.  That's why I'm here - thanks for your generous spirit in sharing your trading knowledge.  After 30 years of investing, I have given up and am learning to trade.  I believe investing is dead because it's all rigged, and the declining dollar means that sitting still with dollars is actually going backwards.  Gotta be flexible in these changing times, and that means helping each other.  Right now I definitely need to learn how to make this work, so thanks to all who contribute to and support this board (best one I've ever been to).

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Patience my a$$...gonna sell something.

pailin
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self-employed

freeboundary wrote:

I can’t be more envious of you to be self-employed.

Well, let's not get ahead of ourselves here :)

The way it worked is I started a small "play" business three yrs ago with the intention of trying it out and (possibly) growing it enough to replace my corporate salary. It's grown all right, but only to 1/3 of that corporate salary. Ideally, I would have kept the salary until target was hit before transitioning. My hand was forced against my will.

Just don't want anybody to get the idea I've got it all figured out. I don't. I'm learning here (and other places) everyday too. I'm reading a lot of books, things I should have read years ago too. Intuitively I've been doing the right things, but until reading Henry Hazlitt, Livermore, Mises.org folks, Daily Reckoning, JSMineset, Trader Dan et al, I didn't know "why"? Now I'm figuring that out and tightening up my operation. Miss that salary though :)

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To the intelligent man or woman, life appears infinitely mysterious, but the stupid have an answer for everything. -Edward Abbey

freeboundary
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  Whenever you miss the

Whenever you miss the salary then think how much time you had to spend in covering yourself up or dealing with politics at your old job :-)

Here is a quote by Marty Schwarz at Market wizard along this line. (Marty has been trader on his own account for most of his career. So he meant “trader” below by an independent one instead of a trader working for someone else. )

“The great thing about being a trader is that you can always do a much better job. No matter how successful you are, you know how many times you screw up. Most people, in most careers, are busy trying to cover up their mistakes. As a trader, you are forced to confront your mistakes because the numbers don't lie.”

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