What a busy mid-term week !
At the end of this week, I suffered from a big loss and gained a negative return in -49% compare to last week -34%. When I opened the stocktrak website this morning, I was very down at the first time after seeing my portfolio value, but then I comforted myself I just lost fuck money in a trading game and it is ending today. Investing in the future trading game is just like playing Roller Coaster, I sometimes found my mood fluctuations with the changing of portfolio value. Although I am not a winner in this game, the future trading game still a rewarding learning experience for me.
From the beginning to now, my contracts focused on soybean oil, corn ,wheat , milk and wheat. Unfortunately, I lose a lot of value in soybean oil, corn and milk, and only gained a little in wheat and soybean.
A Lesson from my soybean oil and corn!!
As the saying goes, a single slip may cause lasting sorrow, 20 units of soybean oil and 20 units of corn laid the failure foundation for me from the beginning. I made these contracts without any market research and analysis, just trade as a risk lover, before making my decision, I should know 20x corn and 20x soybeans is equivalent to buying about $450,000 of corn and $510,000 of Soybean oil. These total value occupied my 10% original value, once these two item suffer from a big decrease, I will be wipe out from the stock market in the beginning, and unfortunately, it happened!!
From the first graph below, we can clearly see soybean oil fall rapidly in the last ten-day of a month, went up with some fluctuation in the beginning before decreasing at the end of October. I bought at $42.5 and ended at $40.73, I found myself in dilemma cause it was hard to make a decision in soybean oil after I buying , and I just waited and watched and did nothing in it, cause once I began cautious after lost a lot of money in the beginning, I prayed soybean oil would bring the dying back to life, but it disappointed me.
I bought corn at $4.61 and sold at $4.45 at the end of September, but it played a joke to me that it began to go up in the next two days, I really regretted my stupid impulsion. If my memory did not fail me, I just lose my patient to wait the US report and followed my intuition .
These two big loss taught me that impulse is the devil. It is important to weigh all options before making a decision, if you put the effort in up front it’ll pay off in the long ru
My feeling to the trading game
It was hard for me to describe my feeling to the trading game. From one side, it was interesting cause we can invest in the virtual stock market without any real money, in the meanwhile, we can learn both technical analysis and put our theory into practice. But from another side, our mountains of assignments always keep us away from the trade game, especially in these two weeks , it seemed that everyone paid more attention on the midterm review and just have little time to do analysis and trade in the stock market, some of us put it entirely out of mind. But as a whole, I enjoyed myself in this game although I made losing investment. I read news and charts before buying my items, and this was a good way for me to know more about the global agriculture market. Additionally, I learnt a lot of technical analysis, such as candlestick, K- line, MA forecast and so on. These useful knowledge will help me to invest in the real stock market in the long run. Besides the game, I am so much keen on to read others’ blogs, I gained so much in reading others’ blogs. Not only for their perceptual description, but rational analysis in stock market as well.
What I learn from the trading game
1. To weight the possible outcome before making your decision. For every option, list every possible outcome and label it as positive or negative.
2. Reminded calm attitude. Always remember that impulse is the devil .Stay calm no matter win or loss. Stock market is risky, and sometimes it is unpredictable, we should keep calm to do some analysis and make the next decision.
3. Know When To Sell Your Stocks. It seemed that greed is the nature. Many of us focuses on what and when to buy stock, yet few ever consider the best time to sell. Don’t let your stock gains disappear due to neglect. Before you get in, always know the specific conditions that will signal when it’s time to get out.
In the end, I want to say thank you to Mark, thank you for your patient guidance and encouragement.
Also, I want to say thank you to MFREers, I really learned a lot from you, the positive learning attitude, the rational analysis and awesome sharing.