trader’s journal

Hello, my name is Trader Vic and I’m a new options trader. To celebrate successfully surviving my first year and turning a profit, I started this trading journal. The primary purpose is for me to remember what I traded, why I traded it, and how the trade worked out. However, I will also include book reviews, market commentary, thoughts on trading platforms, and other items I feel like writing about.

in the beginning

Sometime in 2007 I noticed Sharebuilder was offering options trading. Not knowing anything about options, I assumed they were a scam dreamed up by Wall Street to lighten my wallet, so I ignored the advertisements.

Around mid-summer, Casey Serin made the front page of MSN as the world’s most hated blogger. Through the same article, I stumbled across Housing Panic, where the author mentioned he was short Countrywide (CFC) using puts.

Having discovered what options were good for, I read the disclosures and was approved for level two options trading at Sharebuilder. With only the knowledge that options were volatile and 90 percent expired worthless, I promptly began speculating.

At the time, the now infamous sub-prime crisis began to hit the mainstream media. I focused my speculation on firms that wrote sub-prime mortgages and liar’s loans, as well as banks and brokers with large amounts of level three (i.e. marked to myth) assets. Trader’s Journal will ignore this period, because while I did well, I attribute it mostly to luck, with a minor dash of skill.

moving forward

In the fall of 2007 I had outgrown Sharebuilder’s limited options trading capability and went looking for a better platform. After reading several reviews of trading platforms, I settled on Optionsxpress. This is the point where Trader’s Journal starts.

Using the educational tools provided by Optionsxpress, I learned a bit more about options. I also read a few books, some of which were useful and some not so much. Along the way, I also discovered some amazingly useful web sites. However, I think the best way to learn is to trade with a limited stake (i.e. an amount one can afford to lose) of real money.

disclaimers

All journal entries are posted after I have closed out the positions. As this web log is a hobby, the amount of time between closing a position and the subsequent journal entry is variable and can be quite long.

This site is intended for entertainment purposes only. No content on this site should be construed as a recommendation to buy, hold, or sell any security, future, or derivative. At any given time, authors may or may not hold a position in securities discussed on this site and are not required to disclose such positions.

For privacy purposes, position sizes and amounts will be reported in percentage terms.

This entry was posted on Sunday, October 26th, 2008 at 5:38 pm and is filed under FAQs. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.