Honest truth...

Good morning,

Once again the force of market proves my belief right that no one can beat the market consistently. Perhaps I should say that I cannot beat the market consistently. Last night was the first night that I am totally in the red for all my positions that I am still holding, though overall I am still profitable for the week. The ISM report didn’t help my positions. Also, too much is read into Obama’s speech and traders are worried about Friday’s unemployment report. Together with the White House hinting that this figure may tick higher, the markets declined into the sea of reds and stayed there for the rest of the session.

This is the time that KUTE’s selection criteria and money management principle helps. The stocks selected by the system are all fundamentally sound companies and as always mentioned in this blog, it is the companies that I am analyzing, not the pattern of price movements. Surely news can affect prices, but if nothing changes the companies’ fundamentals, I should not worry. Also, the money allocated to active trading is only 50% of the amount I deposited with the broker; I still have ample room for the selected stocks’ price to decline before recovering into positive territory. By then I will shout to the market again that I have made money in the US markets. (smile) The honest truth is I am out of the money today.

NOV lost 2.37% to close at $42.82 last night. I bought a position at $42.99 and another at $42.80. Together with the 2 position I bought the previous night, I am now holding 4 positions in the stock. Currently this is the only stock I am holding. FRX closed 1.05% lower at $31.23, SIM gained 6.13% to close at $8.49 and CGI lost 1.12% to close at $12.39.

It’s Friday and time to drink tonight. Why worry? I have my positions’ limit placed and even if these positions’ value continue to decline, they will surely re-bounce along with the economy’s recovery.

Have a good day.

Francies Cheng
BBus MAppliedFinance