Wow, what a horrible week! I lost $742 dollars in the currency markets or 33% of my original investment. I consider myself lucky though, I had only invested $2,250. Still, I could not get it right. Luckily I have a secret weapon to handle all of this insanity.Meet the newest member of the family. It's Pepe at 3 weeks! Wow-e-e. Isn't he sweet! My insanity cure all!
Trading on the Forex can be ver-r-ry tough. For example, I tried trading the EUR/USD pair, but that position completely reversed on me after a few days; of course, I reversed my positions but the pair stabilized and went the other way. I tried the USD/JPY pair as the dollar was showing some good strength against other currencies based on the Feds interest rate cut a few weeks ago, but that position just ended up stalling for three days. I tried the EUR/JPY pair, but nothing there. That pair again just stalled then went south after three days of flip flopping around. In the meantime I just kept losing money. By Thursday night- I was so disgusted that I just liquidated all of my positions in all three pairs. I was in such a bad mood. I felt like writing a congressman, writing the FCC or the SEC to complain about unfair trading practices, bid rigging and all sorts of imagined slights against me- the small investor. However, Friday morning I checked closing prices on all currencies pairs, including the pairs that I trade, and they were all down substantially- 100 to 200 pips.
For those of you that are just reading our blog, we are building a bank portfolio- for the long run of course, that will weather the current crisis well and make us a lot of money. In addition, I will point out the bank stock that is most likely to give you the most bang for the buck as we build our bank portfolio in a very unfriendly banking environment. We started with BBT Corporation (BBT:$34.06) and iShares Trust- Dow Jones US Fin Sec (IYF: 82.51), on 4/12/2008. We are adding JP Morgan (JPM: $46.57) at the closing price per share on 5/9/2008. Our portfolio of three stocks is up by 3.01% as of 5/11/2008- commissions to purchase the positions not included.
For those of you that are just reading our blog, we are building a bank portfolio- for the long run of course, that will weather the current crisis well and make us a lot of money. In addition, I will point out the bank stock that is most likely to give you the most bang for the buck as we build our bank portfolio in a very unfriendly banking environment. We started with BBT Corporation (BBT:$34.06) and iShares Trust- Dow Jones US Fin Sec (IYF: 82.51), on 4/12/2008. We are adding JP Morgan (JPM: $46.57) at the closing price per share on 5/9/2008. Our portfolio of three stocks is up by 3.01% as of 5/11/2008- commissions to purchase the positions not included.
I recommend starting with an iShares security in this uncertain market environment- each iShare represents a proportion of ownership in each stock that makes up an index. iShares are a great way for smaller investors to get the diversification of 50 or more companies without having to buy each individual stock.
Check our blog at the end of the week to see if we have added or reduced positions in our 'Building your Bank ' series.
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