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The newsletter other trading professionals demand
I received an email last week that kind of shook me. Here's what it said: "Louise, I'm a fan, but I have a piece of advice for you that I do hope you'll follow. You're telling people too much. As an example, I know that you openly tell people how it took you 3 years to break even on the share market. You need to be aware that people don't want to hear this if they're going to follow your strategies. They need to feel they can put their faith in the things that you do, so they'll be able to trade well." Ahhh... isn't this an interesting topic? Is it wise to be so open and share so much personal stuff? (Answer: wise - no. Honest - yes.) Are people more likely to follow someone without a few bullet holes and scars? (Answer: Personally, I'm not so crazy about listening to those with the Midas touch. They're not all that interesting, relatable, or knowledgeable about the strategies you get to create when your back is to the wall. Also, when the bullets do start flying about, I'll bet that they'll be running for cover, crying "Mummy, Mummy...") So, yes - I do risk showing you my heart in these newsletters, and pointing out the things I've done wrong with trading, as well as right. However, it seems to me that the overwhelming majority of people go through life literally crippled by not wanting to appear embarrassed in front of other people. They live their lives of quiet desperation and dissatisfaction - subservient when they should take charge, quiet when they should be speaking up, dependent when they should be independent and poor when they should be rich. As I walk beside you on your trading journey, pointing out the hidden land-mines (because I have stepped on them before), just realise that I'm willing to look a bit goofy on the occasion - because I care about your trading success. I'd rather tell you what I've done wrong, so you can learn from my experiences, and you don't need to go ahead and repeat them. And besides... those initial 3 years taught me valuable lessons - so I really don't look back on them as a 'failure'. Without those first few traumatic ups and downs, I wouldn't be the person I am today. With this in mind, shout yourself a 10 minute break, grab a cuppa and read this month's free copy of the Trading Game Newsletter. This 10 minutes might be all that it takes to turn around your trading account, forever...
In this month's newsletter: - Tate on Trading - Commodities - The Big Picture
Tate on Trading - Commodities - The Big Picture Chris Tate In recent times, it has become fashionable for market forecasters to look for a macro expression of their market of choice. For example, if you were looking at banking shares you might look to the banking index and then to the broad market index such as the All Ords in an attempt to gain an understanding of what is happening with equity prices in general. Broadly, I think of this being a good thing since it implies an attempt to gain an understanding of what is happening in the world beyond the limit of the dealing desk where the myopic desire to generate buy recommendations is king. Unfortunately analysts and brokers do not understand the market well enough to take this to its logical conclusion and use it as a decision as to whether it is a good time to be long equities or not. Most market forecasters are still locked into the myth that it is time in the market not market timing that is responsible for success in the market despite there being tremendous evidence to the contrary. However, touching up equity forecasters is not the subject of this tirade. This month I want to touch up those who forecast commodity prices. Commodity forecasters have a preferred tool of choice when it comes to understanding their broader market – the Commodity Research Bureau Index. This index tracks a basket of commodities and produces a chart like the one below:
First published in 1957 the index has undergone periodic review. Originally, the index had some 28 components: 26 futures markets and 2 cash markets. The logic behind its construction was that it would provide an overview of commodity markets and the current trend in commodity prices. If you look at components such as eggs, barley and lard, you can see that the index reflected the economic activity of the time. As would be expected, such an index would have to be periodically revised and since 1961, there have been 10 revisions with the addition and deletion of commodities and a change in the mechanics of referencing futures contracts from one year down to nine months. The final revision in the index also included a change in the formal name to Reuters Jefferies CRB Index. However, the most important revision to the index was not in the alteration of its components but rather the move from being an equally weighted index to a biased index. Previously all components were equally weighted. This has changed to the index being made up of a four tiered arrangement designed to reflect the economic importance of a given group. For example, tier one is made up of WTI Crude Oil, Heating Oil and Unleaded Gas. This group makes up 33% of the weighting of the index. Whereas tier four is comprised of Nickel, Wheat, Lean Hogs, Orange Juice and Silver and makes up only 5% of the index. In fact, tiers three and four when combined only make up 25% of the index yet comprise most of the agricultural commodities. This move away from being equally weighted now invalidates the CRBs Index's role as a barometer of commodity prices and moves it towards being a lagging tracker of energy prices. The chart below shows the CRB index and WTI Crude contract side by side.
It makes no sense at all to use an index whose focus is energy prices to make any statements at all about soft commodities or even metals. To do so is as logical as measuring the weight of cods in golf balls. To gain an understanding of the dynamics of a segment of an individual commodity market you are better off either looking at the individual price of that commodity or looking at one of the ETC trackers such as those generated by UBS-Dow Jones, which is the approach we recommend to our mentor group. Unfortunately in markets the majority of people who make prognostications do not have a sufficiently deep grasp of their subject. This leads to erroneous evaluations of what is happening and even sillier advice. If you want to know what is happening in a given commodity market, fire up the old Google box and find a chart. - Chris Tate
Competition - Your Chance to Win! This month I've got some terrific news. We're launching our first ever newsletter competition. We'll be drawing it on April 1st, 2010, so make sure you're in it to win it! There are over $2,000 worth of trading resources up for grabs. No - This is NOT an April Fools Day Joke! And yes - You could be the winner! To celebrate some of the leaps forward our traders have been experiencing, I'm proud to announce a very special competition. Please let me explain... If you're especially diligent, you will have noticed that we've added an 'Update Your Details' section to our website homepage.
We're keen to make sure that we keep up to date if you change address, or alter your email address. You can help us achieve this goal, as well as grab a chance to profit from this BIG TIME. All you need to do is check that your contact details are correct, and make any necessary alterations by April 1st, 2010 and you'll be placed in the draw to win your choice of either the Introductory Pack or Intermediate Pack of trading resources. So, click here or use the Update Your Details link at www.tradinggame.com.au, and you could could score some of the best trading tools available in Australia - for FREE! You could win either:
OR
We'll announce the lucky winner's name in the next Trading Game Newsletter. So act right now! Click here and check and/or update your contact details - before it's too late, and you'll be even closer to achieving the results you deserve.
Tony Laughton Shopping online. I’ve been doing it for years now. Visit the website, add the item to the cart and put in my credit card details. Bang! Done. Move onto the next thing for the day. You can buy almost anything online. It’s easy, efficient, and somewhat satisfying. But there are still hoards of people who believe that if you buy something online, your bank accounts will be instantly cleaned out, your identity stolen and your children sent to toil in the salt mines. At the other end of the spectrum, flinging your credit card details to just any site on the net will eventually cost you more than that bottle of ‘little blue pills’ from Canada. As with most things, the truth lies somewhere between the two extremes. With a bit of commonsense and awareness of online security basics, shopping online can be safe, efficient and rewarding. Almost every business now has a virtual shopfront. Well at least those who want to stay in business – I actually find myself discriminating against enterprises that vie for my custom but then demonstrate how little they care by not having a web presence. So what should you do to stay safe when shopping online? 1. Deal with real businesses Check that the business has a registered Australian Business Number (ABN). You can look up a company by its name or ABN on www.asic.gov.au or www.business.gov.au to check if the company or business is legitimate. 2. Make sure you can get a return and refund or a replacement The site should have information regarding the return/refund and replacement policy. In Australia there are laws governing warranties and refunds. If you are buying items from overseas to be shipped back to Australia, Australian laws don’t apply, and even if there are good consumer laws in the other country, they may be hard to enforce from Australia. There is a cross-border complaint site www.econsumer.gov which you can access if you have a problem with overseas online shopping. 3. Check the site uses encrypted pages for sensitive details During the shopping process you will eventually move on to a page where you input your details and credit card number. Make sure these pages are using secure HTTP. There will be a padlock symbol in the browser’s lower right corner and the address bar URL will have https:// at the beginning. These indications show that the information transmitted via these pages is secure and cannot be viewed by any third party looking to intercept the data stream. If you’re still feeling paranoid, most businesses will allow you to use Electronic Funds Transfer (EFT) to pay directly from your bank account to theirs. Usually you just need to email a confirmation to a specified email address that you have paid using this method. You can also set up your browser to alert you when you’re entering or leaving secure pages. For example, in Firefox, click Tools->Options->Security->Warning Messages->Settings. 4. Take note of the expected delivery time If your purchase hasn’t turned up within the estimated delivery time, contact the vendor to make sure they received the order and it has been processed. The banking industry is one area where online commerce has been promoted heavily. To encourage their customers to do their banking online, banks have done everything short of putting a huge sign above the door at every branch that says “GO HOME AND DO IT ON THE INTERNET YOU FOOL!” When I actually have to occasionally venture into a Post Office to post an item I often get stuck behind some dweeb who wants to pay their rates, water bill and utilities over the counter. At this point I always have to suppress the urge to grab them by the lapels and scream into their face “GO HOME AND DO IT ON THE…” anyway, you get the drift. Get a grip people. It’s not a decline in society by stealing anyone’s job. It’s a shift in wealth from the people with their head in the sand to those with their eyes open. Online commerce is here to stay. It’s good for you and the vendor and the economy, and yes, even the environment. Follow my suggested guidelines and you’ll save heaps of time, money and get the things you need with the least fuss in complete safety. - Tony Laughton is a Melbourne-based IT consultant and private trader.
The new Mentor Program is up and running and those lucky traders involved are already reaping the rewards. Reports are flooding in every single day about how spectacularly focussed and easy to follow the program is. This is Your Best Shot! Click here to read our Frequently Asked Questions about the Mentor Program and to get a grip on what it's all about. Want proof? Visit our Rave Reviews and More Rave Reviews pages to hear from regular people who took our strategies and applied our methods to achieve phenomenal trading results.
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The Mentor Program Foundation Book Pack If you're serious about doing the Trading Game Mentor Program, then this book pack is for you. It will provide the ideal preparation required to complete the Foundation level of the program, and will give you an insight into the trading methods used by Louise Bedford and Chris Tate. You'll receive three of Chris and Louise's best-selling books, all in the one convenient pack, for an incredible 10% discount. Right now, this is the best thing that you can do to prepare for the 2010 Mentor Program. Order your pack today, save 10%, and develop the foundation required to excel in the Mentor Program and beyond!
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My biggest concern with traders is that so often, I see them spreading themselves too thin. They get their heads turned by the latest trading tool, and before you know it, they're trading options, CFDs, E-Minis, FX as well as commodities - all at once, using one minute charts - and they have no life. Plus, the results they're generating aren't any better than someone who just chose one of those instruments and focussed on it. Don't neglect the opportunities at hand - in either your trading, or your life. Find something you relate with in the markets, and be unwavering in your discipline. I can tell you now - focus is the fastest way to success in this lucrative game we call trading. So, until next month ... Happy Trading!
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| Copyright The Trading Game © 2002 - 2010 (ABN: 18 418 996 042)Trade with the Professionals. Louise Bedford, Chris Tate and Trading Game Pty Ltd are Authorised Representatives of Commodity Broking Services AFSL 280372. The information contained in this email is correct at the time of publishing. It is of a general nature and does not take into account your objectives, financial situation or needs. Before acting on any of the information you should consider its appropriateness, having regard to your own objectives, financial situation and needs. Except where stated, the information contained in this email is the copyright of The Trading Game Pty Ltd and may be not be reproduced without formal permission. |
