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	Flashback: My Very First Trade I will never forget the first trade I ever made. It was March 7th '05 and I was exploding with excitement that my $2,000 had just become available in my newly opened Scottrade account. I saw dollar $igns everywhere I looked and was absorbing information about the market like a sponge. After reading a few books, scanning every page of Investopedia.com and asking some experienced investors for some hot stock tips, I was anxious to pull the trigger. That morning I was up at 6 am ready to dive into the market full steam ahead. Through fundamental and technical analysis I determined that INTC was the symbol that would transform me from a boy in West Hills, into a Wall Street hot shot. I remember spending extra time analyzing Intel because if the first stock I bought didn't go up, my investing career would be doomed from the beginning. I knew that I needed to be diversified, so I allocated 25% of my portfolio to the trade and waited for the perfect entry point. Symbol "INTC" | Market Side "Buy" | Quantity "20" | Type "Market Order" I patiently anxiously with my mouse pointer on the "Send Order" button. My heart was pounding out of my chest, this is it, I think INTC is about to break out... CLICK! AHH popup windown... You've entered a Market Order to Buy 20 shares of INTC. Is this correct? CLICK! 10:25:36 You bought 20 shares of INTC at $25.36 Success!!! I remember just watching the chart all day. INTC's price didn't fluctuate as much as some of the other stocks on my list but I didn't care. I felt like this was the first day of the rest of my life. The next day I bought TIVO and NAPS(Napster), both super exciting, but nothing like my first trade. It wasn't for about 6 months that I learned the exciting heart pounding excitement I was getting from trading was the primary reason most investors lose their shirts in the stock market. When trading stocks, "You must control your emotions, never let your emotions control you". After following INTC for the next couple days, I realized that the homework I had done about analyzing the fundamental and technicals of individual stocks was no help for the awkward situation I found myself in. After two days the stock had fluctuated no more than $1 up and down which amounted to only a $20 fluctuation in my portfolio. When you calculated in the fact that I was paying $7 a trade, if INTC was up a full $1 that would ammount to me making a whopping $6! I calculated that in order for me to make $100 off this trade INTC wold need to go over $30! That could take a year at this rate! (INTC still hasn't hit $30 in the last 3 years) I ended up selling INTC just four days later at an $18 loss. I didn't care because I had learned what I believed to be some valuable lessons: 1) If I wanted to get rich, I needed to buy cheap stocks. If the stock price is low, I can buy way more shares! 2) Figure out how much you want to make off a trade first, then find a stock that will get you there. That first rule helped me lose about $2,500 my first 18 months of trading. The second rule turned out to be a good one that I still use today. 13 May 2008

	The Flashback Series It was three years ago this month when I opened my first brokerage account and started trading. Looking back I can't help but notice how my investment strategies have changed. The reason I started this blog in the first place was so that I could keep track of my trades and trading strategies. What works? What doesn't? How could I have done better? What did this trade teach me? While I have learned a lot about investing by reading books and articles by other people, there is far more to learn by analyzing your own investing experiences. Unfortunately I didn't start blogging about my trading experiences until Jan '07, but I remember my first trades like they were yesterday. I spent some time tonight looking back on some of my early trading records and it brought back some of the most memorable, exciting experience I have had in the market. In "The Flashback Series" I will highlight some of my most memorable trades as well as the most valuable lessons I have learned so far. Hopefully my experiences will help someone else out there avoid some of the gut wrenching losses I have had, or maybe I can help them make 150% in 3 days like I did in July of '05 =) 13 May 2008

	AMZN Trade Update & Plan Almost every stock in my portfolio has been following their plan. AAPL, FMCN, LOCM & GLW have all been up nice. UA, which I am short, has been going down for some time now. The only stock which was actin up has been AMZN, until this week. I sold AMZN short on April 10th at $73.02 when I built out my portfolio. I sold ahead of earnings with a long term outlook based on my theory that the market is in pretty bad shape. What I hadn't expected was the all mighty Google having an unbelievable quarter and sending every stock with a website up 10%. After AMZN's "ok" earnings the stock took a small hit and has been trickling downward ever since. While I was looking like I was in pretty bad shape for a couple weeks while AMZN was hanging out at the $80 level, the trade has gone into the black and I think it will turn out to be a pretty profitable investment. Like most of my trades, I have a fundamental as well as technical reasons for the trade. On the fundamental side, I feel like the economy is in pretty bad shape and just about anything you buy on Amazon.com is more of a "want" than a "need". For the most part, people are going to be leaving a lot of their "wants" in their wishlist for the next couple months as appose to placing orders. Amazon's web services look promising, but are not at the point where they can make any significant difference. The Kindle, I think it is way too early to tell what will happen with that. I say Apple comes out with one and for absolutely no reason other than the fact that they are Apple, steals the market and starts selling books and magazines on iTunes. The technical analysis of this chart looks pretty promising. AMZN made an unbelievable run up 150% last year on good earnings and good outlook. Since then, the speculation has gotten out of control and analysts are setting the bar too high for AMZN to have a chance. Back in March the 50 day simple moving average dipped down below the 200 setting off a pretty bearish signal on all the trend followers systems. When the averages crossed the stock turned around and trekked back up towards the 200 day SMA. The big GOOG quarter sent AMZN soaring up to the 200 day SMA where it couldnt break into the $80+ trading range. What you see in the chart below was AMZN unsuccessfully breaking through the 200 day SMA and then getting punished for it. As of today, AMZN has broken through the 50 day SMA and should continue its downward journey as the economy worsens. I plan on hanging on to my short position in AMZN for some time. My target price is down between roughly $55-60. This I plan on making this more of a "log term" trade, I am looking at the long term support and resistance levels. My target price is just between the high in Sept. '03 and the high set in Jan '06. This level also just so happens to lie directly in the center of the monster jump AMZN made in May '07. If you look at a 2 year chart, AMZN has been as low as $26-27 so you never know =) 09 May 2008

	Wimax, The Speculation Starts Here I remember talking about WiMax like 4 years ago, "It is like giant wireless routers setup like cell towers all over the city". I know this sounds crazy, but that is basically what WiMax is. I have no idea what has taken so long for this technology to get rolled out, Intel has apparently been finished developing it for years. Intel even assisted the FCC and FEMA by rolling our WiMax in New Orleans after Hurricane Katrina. The lagging issue aside, it looks like WiMax is finally getting the funding it needs for the big national rollout. On May 6 Intel ($1 bil), Time Warner($550 mil), Comcast ($1 bil) and Google ($500 mil) announced that they will invest more than $3 Billion in ClearWire(CLWR), an up and coming Wimax provider. Sprint announced a couple years ago that they were going to build out a giant WiMax infrastructure to try and corner the market. Now that WiMax is finally getting the press it deserves, I saw we start speculating. But first, lets answer the one question everyone is asking, "Who is Clearwire?". ClearWire was started by a telecommunications industry pioneer by the name of Craig O. McCaw. McCaw outsmarted the giant telco giants back during the babybell days by purchasing up millions of local FCC licenses that the telcos didn't know they would eventually need. He later sold his company to AT&T for $11.5 billion and now he's at it again. This guy sees the potential in WiMax that he once saw in these FCC licenses. He knows the telco industry like the back of his hand and now he has Intel, Google and major cable operators giving him billions of dollars. While he has convinced the tech heavyweights, he has yet to convince investors. Shares of ClearWire had a monster IPO back in March of '07 and have been sliding ever since. The nice pop CLWR got this week from the big funding announcement got shredded 10% today by a Citi analyst who downgraded the stock from "hold" to "sell". Sounds fishy too me. Lets see, Google, Intel, Time Warner, Comcast and this McCaw guy believe in WiMax so much that they invest billions, some Citi analyst on the other hand hates it. Who do you believe. If you are like me, you believe the tech heavyweights of the world over the Citi guy. I see ClearWire as a great way to play the future of the internet. Let's go ahead and speculate, you know... the fun stuff: 1) Lets start by saying that WiMax technology is 5, or even 10X faster than anything currently available by AT&T & Verizon as far as wireless connectivity (I have actually heard that this is true). 2) Then let's go ahead and say that part of the reason Apple switched to Intel chips a few years ago had something to do with knowing all about WiMax. Wasn't this about the time that Mr. Jobs started working on his first iPhone? 3) Of course Google is investing $500 million in this company right about the same time they are releasing their new android platform. But Google invests in everything, and didn't they spend twice that for youtube? 4) McCaw has already convinced AT&T to buy one of his companies back in the day. If this gains traction, I could see that happening again. 5) Comcast and Time Warner want in this deal in a big way hu? My home phone, tv, and internet is already provided by Time Warner, why not my cell phone too? There are only two pure plays if you want to try and invest in WiMax. The first and most obvious is ClearWire. The stock is down big and I think this is a good place to start building a position. The next is a little known penny stock that recently hit the radar, AIRN. Apparently they make the WiMax hardware needed to roll out these big ol networks. Intel, Google, Time Warner & Comcast are all too big for any change in the WiMax area to make any real difference in their stock price. But this doesn't stop us from speculating. Internet EVERYWHERE has been a long time in the making, is it finally here? What else will come along with it? There is surely a ton more room to speculate in the comments =) 08 May 2008

	Hogs Get Slaughtered Unfortunately I think it is time to start scaling back on some of these winning positions. I have not researched any other stocks to put the money in, so I will leave it as cash for the time being. Better to act first, ask questions later. I started this morning by selling my Apple position. Trade record as follows: Bought AAPL @ $154.24 on 4/10/08 Sold AAPL @ 186.08 on 5/6/08 Gained 20.64% June 1 is Apple's big iPhone announcement. They will be launching their application platform and rumors are swirling about a new 3G iphone. I have always been a big fan of buy the rumor, sell the news and this is a perfect example. The sell could be a little premature but 20% is a serious gain. Bulls make money, bears make money, hogs get slaughtered. 06 May 2008

	Microhoo Looks Like A No Go How could this week be complete without a Microsoft Yahoo post? I haven't posted about this yet but it seems pretty obvious. Microsoft had offered $47.5 billion to buy Yahoo Inc., but scrapped the bid late Saturday after they could not agree on a sale price. Yahoo!'s stock popped pretty big the last couple weeks as investors anticipated the deal would go through. Unfortunately Yahoo! fought off the bid, Microsoft backed out, and the stock tanked 15% today. The news broke Sunday and bloggers were going cRazy. At one point @Scobleizer noticed that the ENTIRE TechMeme was nothing but Microsoft/Yahoo Articles. The best coverage by far has been over at TechCrunch. So if you are interested in more details on this event, go here. 05 May 2008

	My Five Rules For Building A Portfolio Ever since I decided to "Rock A Full Portfolio" I have been having one my my best months to date. I attribute this to five different decisions I made when I decided to start testing out this trading strategy. 1) If the stock doesn't act as expected, dump it. 2) Hold short as well as long positions simultaneously. 3) Keep some cash on the sidelines just in case an opportunity presents itself. 4) Don't let the daily fluctuations force me to make quick unplanned decisions. 5) Pick stocks which have near term catalysts or look to be at a bottom. --If the stock doesn't act as expected, dump it-- Each stock I picked I did so because I had expectations for it, usually to go in the direction that I had anticipated. Of the five stocks that I chose two decided to act unexpectedly. The first, STP, seemed to be in a nice position to take advantage of rising oil costs. It was a solar play that had been lagging behind the other stocks in it's sector. I bought in at $47.62 just before oil started making its treck up to $120 a barrel. It started to trend between $45-48 and wasn't able to break out of the range. With oil hitting all time highs STP should have been breaking out so I decided to sell at a loss at $45.10. It is better to take the small loss and put the money elsewhere than hang in there with a sock that going against your research. The only other pick that acted unexpectedly is Amazon. I sold short going into earnings because I expected them to guide down for the rest of the year and potentially have just an OK quarter. Both of these predictions did become true, and the stock did go down after earnings. What I hadn't anticipated was the market wide rally that happened just days before due to the amazing Google numbers. Google managed to carry every tech stock up 5-10% which prove to be awesome for my Apple pick, not so good for my short position in AMZN. I have decided to hold onto AMZN because I still feel it will go lower. It has backed off of its recent high and is now trending downward, back to where it was before the Google earnings. I still expect to make money off of this short position. --Hold short as well as long positions simultaneously-- This rule is one of the primary reasons I have been in the green almost every day since picking this basket of stocks. During these turbulent times the market has seen some nice green days, as well as some ugly red ones. When the market is down, my short positions have kept my portfolio from seeing big losses. During the green days, a lot of the time my short positions have still been down because they are not good stocks. Having both short and long positions has really helped keep the equilibrium in place and I cant imagine ever being only one sided. --Keep some cash on the sidelines just in case an opportunity presents itself-- You never know when a situation might come up where you need cash to pick up some stock. This happened on 4/28 when I was confident GLW would have a great quarter and I wanted to get in before earnings. They were showing some super bullish signs and It just seemed like a no brainer. If I hadn't had some cash around to buy GLW I would have had to sell another winning position to get some. Selling one winning stock to buy another doesn't change anything, but taking some cash and putting it to work does and I am glad I had the money ready to go. --Don't let the daily fluctuations force me to make quick unplanned decisions-- This rule has proved itself time and time again. So much that it deserved it's own post back on 4/22. The best example of this has been my Under Armour position which has been on a downward trend for some time now. I have been short since 2/5 now and almost bought back on multiple occasions. Just before their recent earnings UA ran from $32 to $39. That put a serious dent in my position but I was confident they would have a bad quarter and was right. Just after earnings they fell from $39 back to $33. When the daily fluctuations are making you think twice about your position, sit back, pull up a 6 month chart, and remember why you chose this position in the first place. --Pick stocks which have near term catalysts or look to be at a bottom-- Deciding when to get in on a position is one of the hardest parts of portfolio building. One strategy I have used with great success is getting in on stocks juuuust before a near term catalyst. The reason you do this is because you don't want to get stuck in a position that keeps fluctuating between profitable, and in the red, green, red etc. For example, I decided to buy GLW just before it's earnings announcement and just as the 50 day moving average crossed the 200. I got in at $25.93 the day before earnings and found the stock up a full dollar the very next day. If it had gone down, I would have sold, but since it went up, now I can hang on knowing that it is well above my buy in price. I can even put a stop in at $26 to make sure I don't lose any money on the investment. Testing different strategies and recording their results was the primary reason I started this blog and this is a perfect example. So far over the last month I have had one of my most profitable months to date (up over 20%) while testing a strategy I had never tried before. I don't think I have ever had more than 4-5 stocks at once. It has been a real learning experience, and I plan on sticking with this strategy for some time. 05 May 2008

	AAPL wants to break into $180 AAPL seems like it is dying to break into the 180 range. Yesterday afternoon it made a run for it just before the fed cut IRs and then tanked. Today it hit $179.50 and then retreated until the last 10 minutes of the day when it made a crazy run for it! I posted on twitter "AAPL is making a run for it... can it make it before the close?!..." And then in a surprise twist... AAPL closed at exactly $180!!! haha woohoo I expect AAPL to gap up in the morning just to prove it belongs in this new trading range. 01 May 2008

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