2014 08 01 Selling Europe..... and the UK.....
Here is a video of my assessment of the markets as they stand this weekend. How the markets move in general is obviously a massive influence upon the trades that I take. It doesn't make any sense for me to have lots of long positions if the markets are generally going down, for instance. Anyway, for those of you who don't have time to watch the video, my opinion is that European and UK indices are falling. Indices in the US have dropped back somewhat in recent weeks, but don't (yet) look like they are falling.
In light of the above, I have set a sell order on a stop (ie if the price drops to a certain level, the order is triggered) to open a short position in TR European Growth Trust plc (TRG).
Why am I doing this?
1. The price has dropped below the average for the year (50 weekly MA)
2. There are two lower highs in place, down from the high in January
3. Prices tend to fall faster than they climb, so I am trying to get on a trend early (but is it a trend?)
What if I'm wrong? Arrgghhh! These thoughts hold me back from pressing 'Trade' on my trading platform - Fear!
1. Setting a stop loss order above the high in January will make me exit the trade if I'm wrong, and I'll lose an amount of money that I'm okay with. Once the trade is moving into profit, I'll start moving the stop-loss downwards, and ratchet in the profit. When the price then starts to rise (which it will, eventually), my stop will be hit and I will then be out of the trade, hopefully for some profit.
TRG is an investment trust consisting of a basket of shares from continental Europe, but no UK shares.
I am also setting a sell order for Henderson Smaller Companies Investment Trust (HSL), an investment trust that buys shares in UK smaller companies.
Why?
1. Its fallen through its average for the year
2. There are lower highs and lower lows in place.
I had great difficulty setting up short positions for the UK mid and smaller companies trusts/funds/indices, one of my providers was not offering short positions in many of these instruments and my spread-bet provider wanted to have too much per point, making my risk on that single trade too great. Sometimes I have to hunt around to find an equivalent instrument to trade. Hopefully I've managed here.
If you are interested in how my currently open positions are performing, click here to watch the video. Sorry, it's about 18mins long, but may give you some more idea about how I set stop-losses and exit trades.
I am writing about what I am doing only. These are not recommendations to anybody. If in any doubt, read my disclaimer here.
Have a great week!
Andy
In light of the above, I have set a sell order on a stop (ie if the price drops to a certain level, the order is triggered) to open a short position in TR European Growth Trust plc (TRG).
Why am I doing this?
1. The price has dropped below the average for the year (50 weekly MA)
2. There are two lower highs in place, down from the high in January
3. Prices tend to fall faster than they climb, so I am trying to get on a trend early (but is it a trend?)
What if I'm wrong? Arrgghhh! These thoughts hold me back from pressing 'Trade' on my trading platform - Fear!
1. Setting a stop loss order above the high in January will make me exit the trade if I'm wrong, and I'll lose an amount of money that I'm okay with. Once the trade is moving into profit, I'll start moving the stop-loss downwards, and ratchet in the profit. When the price then starts to rise (which it will, eventually), my stop will be hit and I will then be out of the trade, hopefully for some profit.
TRG is an investment trust consisting of a basket of shares from continental Europe, but no UK shares.
I am also setting a sell order for Henderson Smaller Companies Investment Trust (HSL), an investment trust that buys shares in UK smaller companies.
Why?
1. Its fallen through its average for the year
2. There are lower highs and lower lows in place.
I had great difficulty setting up short positions for the UK mid and smaller companies trusts/funds/indices, one of my providers was not offering short positions in many of these instruments and my spread-bet provider wanted to have too much per point, making my risk on that single trade too great. Sometimes I have to hunt around to find an equivalent instrument to trade. Hopefully I've managed here.
If you are interested in how my currently open positions are performing, click here to watch the video. Sorry, it's about 18mins long, but may give you some more idea about how I set stop-losses and exit trades.
I am writing about what I am doing only. These are not recommendations to anybody. If in any doubt, read my disclaimer here.
Have a great week!
Andy
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