≈ That’s the beauty of the financial markets. ≈
“The most terrifying fact about the universe is not that it is hostile but that it is indifferent; but if we can come to terms with this indifference and accept the challenges of life within the boundaries of death […] our existence as a species can have genuine meaning and fulfillment. However vast the darkness, we must supply our own light.”Stanley Kubrick for Playboy Magazine (September 1968) —
How successful traders and investors are born? This is the million-dollar question we are humbly trying to answer with the 3-part series “The Holy Trinity of Trading”, published in the Trading Justice newsletter.
The first step in becoming successful is mastering Portfolio Design—covered in the February edition. The second step is mastering Position Sizing (Money Management).
Above all, Position Sizing is an exercise of humility.
- We don’t move the markets, we follow them.
- They are indifferent to us and can be very hostile.
- They are not simple, but utterly complex.
- We don’t know the future.
- Uncertainty lurks.
- Fat tail events await.
To some extent, we must love the fact that we can only lose –100% and acknowledge that Position Sizing will be there for us when all else fails.
This is what the March edition of the Trading Justice newsletter is all about. This month, we are taking you for a ride in the unfathomable universe of Money Management. A universe where the most you can lose is –100%.
Chart of the Day
The Boeing Company
In the March edition of the Trading Justice newsletter, we talk about Creatures from the Abyss & Meteorites from the sky. We can’t predict when they are coming for us, but they are, inevitably. A deadly crash in Ethiopia last Sunday killed 157 people. From its highs on March 1st to the bottom yesterday (March 11th), Boeing shares experienced a –18% drop. Only position sizing will be there when all else fails.
Video of the day
Coach Noah Davidson explains the importance of defining risk before placing any orders, even more during high volatile markets.
Today’s line up
Tales of a Technician
How I Traded the Boeing Gap
Boeing’s textbook bull retracement pattern made it a top contender on our weekend Scouting Reports. But Sunday’s plane crash changed everything. Google it if you haven’t read the details. I want to focus on how we might have traded this morning’s down gap. Specifically, I’m going to illustrate how I scaled-in to bull puts and successfully turned a large loser into a scratch.
Traders Lounge 11PM EST
Join the coaches in this live lounge, ask questions, discuss ideas or just sit back and listen to veteran traders discuss market conditions.
The Coaches Show 8:30PM EST
This is our weekly MasterMind group. Join the coaches tonight, 8:30pm EST to discuss the markets and help you prepare for the week.
Halftime Report 12:30PM EST
The Halftime Report starts at 12:30 EST and covers what news is driving the market, chart analysis from the movers and shakers of the day and fun in a way that only Matt and Tim can deliver.
The Market Recap is designed to give you a quick overview of the day that was. While brief, this report is designed to cover all of the major events that drove the markets that day and help you plan for the trading day ahead.