Thursday, June 18, 2009

Trade 11 & 12 - first pair trade

In an attempt to try to hedge my bets better in the stockmarket - pair trades seem to be a good strategy - i.e getting long on one stock whilst going short in a stock that you think will protect it against systematic risk.

I feel that commodities will continue to do well and the current dropoff is a minor setback - and possibly the financials will turn down in the short term - thus going against the trend of a secular bull market opinion. I can't see how fast rising commodity prices at the beginning of a bull market can actually be a good thing for the economy.

Trade 11:
Long IRN @ 60c 3000QTY - charts are uptrending within the commodity recovery climate.
I think i mis-timed this entry by a whopping 10% - this is a really big mistake and I hope I don't repeat this again.

Trade 12:
Short WBC @ 19.88 160QTY - seems to be hitting resistance volumes have been weak on the upswings. MACD is turning down.

I will keep the trade open as long as they stay within the set stop loss parameters - if one stock hits their stop loss, most likely I will close the other position out also.