When You Don't Have Selling Discipline...

... you've got to have some buying discipline. And that has saved me so many times this year. But I've got the collector's predicament and that's scarier than some of the costumes you might be seeing this Halloween. I'm trying to be a little bit more philosophical, although it probably doesn't sound it. I reckon trading is a lot like cooking. You cook so you can have a meal. You trade so you can get some profits. Sometimes, you end up with a half-decent sandwich. Other times, you end up with pure decadence - such as my scallops grilled in truffle oil. But you've got to actually wok things the right way - and that involves timing. If you only cook the scallops for thirty seconds, you end up with sushi. So the main ingredient missing from my trading? Disciplined selling. I'm over-cooking my trades.

CENX gave the bears a run for their money today, moving up +3.56%. I'm still going to force myself to sell at my target price by moving my stops. I'll let CENX take me for a bit of a ride then. And if it stops me out, then I won't cry - or try not to anyway. But you all know now that I hold a grudge - especially when it comes to trading. Right, Ministers of Finance who sold me at 1.54? If I get stopped out and CENX one day bounces back to pre-crisis levels, I can't look back like I'm now doing with KO, thinking I missed out on about $10 per share by not waiting.

My next step in portfolio recovery: focusing on breaking even with BAC and C by either offsetting the losses with other positions or averaging in at infomercial levels. I want those high double digit losses in my SBA to become high double digit gains in the near future.

Report Card:

+1.60% on the SBA
+1.40% on the Roth IRA

Mathematically speaking, I have confirmed that a -3% loss is much more painful than a +3% gain is delightful.

For instance... on a $10,000 account, you gain 3% the first day, lose 3% the second day, and gain 3% the third day. It would work out to be a $300 gain the first day, $309 loss the second day, and $299.73 gain the third day. So, taking that loss not only knocks the wind out of your sail, but it also decreases your bottom line.