Playing & Trading Strategy

About 21 years ago when I was still 18, I started trading stocks with a $1K account using money from minimum wage jobs. FYI: This is around the time my 1st port was created at HSX.

The next year, I near lost my shirt as they say trading foreign currency options...really do not advise investing in options of any kind, even if you were rich!

In 2000, I started trading commodities futures (e.g., grains such as Rough Rice, Oats, & Soybeans, etc.) with a $2.5K account. FYI: This was also around the time my original HSX port went dormant.

In 2007, following 2 years of music teaching, I opened another futures account with $15K. FYI: I opened a new port here at HSX as "NeilSite". 

In 2009 (10 years ago), I traded Crude Oil futures for the first time.

In 2012, after teaching music for 6 years and obtaining a master's degree, I started my own business as a private music instructor (lessons).

In 2016, 2017, and 2018 (and so far in 2019), my investments in commodities perform at least as well as I do as a private music instuctor. Honestly, I earn about $35K doing what I do, and last year my futures trading profits were over $36K. I could make a lot more (much more) if I were willing to risk by going "all-in" but that does not follow my trading strategy.

You see, when I first traded commodities, I had a full-service broker, which means I would call them and place my trades that way, and then go about my day. I also used a Stop-Loss, which means if the market should move against me, there was in order to exit my position after I'm in the red by a certain amount. While there were gains, I also got "stopped-out" just as often, and combined with ridiculously high commissions for full-service broker accounts, well, I learned my lesson.

You see, with futures, most of the action--the momentum and volatility, happens when most people are at work or in school. There are known reports that are released on a regular scheduled basis. For instance, at 11 a.m. Central, the USDA will release their crop reports, so commodities such as Soybeans and Wheat will be significantly affected. With Crude Oil (which I trade daily), the EIA report is released on Wednesday mornings, the API reports is released on Tuesday afternoons, etc. so there is great potential for profit. Gold futures go crazy over political events and monthly jobs reports, and so on.

Perhaps the biggest change to my trading strategy was the shift to my trading via online platform vs. me calling a broker. Now I'm in control because I can see what I need to see and make decisions on the spot, not call for a quote and "see how I'm doing". Doing what I do for a living allows me to be available for the release of said reports...and, the commissions are a small fraction of what I used to pay! Since I am always there during trades, I no longer use a Stop-Loss for any of my trades.

My trading style is called "scalping". That means I find it more profitable to trade short distances, as opposed to reaching for longer gains. I am usually never in the market for longer than a matter of seconds, minutes at best. Most days a earn about a couple hundred or so, others, on special events, over $1K. I'm not bragging--it's not rocket science! Because of 'algos' (algorithmic trading on behalf of hedge fund managers and private equity firms performs a vast majority of all trades) the trends are easy to follow and I'm just "riding their coat-tails". It really should not be this easy.

Do I ever lose money? Of course! Most of what I have learned comes from trading abstinence (so, observing market behavior) and learning things the hard way. I have set principles and rules to trade by. Usually when I lose money, its hundreds of dollars in a matter of seconds or minutes. But then I ask, how did I lose money? (If you don't thoroughly understand why you made a mistake, you're doomed to repeat it). So, I typically will trade 2 out of 3...meaning if 1 was a loss, I'm going for an additional 2 trades today--one to offset those losses, and the other to make equivalent to what I earn doing lessons. That is why I am usually looking at 5 different commodities, because they all provide different opportunities!

Best wishes and good luck! :)