My Best Trades Were Always...

A few years ago (pre-covid) I took my daughter to a McDonald’s here in Southern California. I couldn’t believe what I was seeing. It was dirty, the food was really bad, and the service was awful.

I was an active day trader back then, rarely holding overnight and trying to scalp profits every day on 5 minute charts. I immediately got on my phone and bought puts and within two weeks they expired worthless.

The trouble is, the consequences of a bad business can’t be found in five-minute charts. They ARE found in daily charts over several weeks or months.

About 4 weeks later the stock was down 25%. And it seemed to be like that for most of the successes I’ve had. I’ve often been right directionally. I just wasn’t being patient enough to let the market do it’s thing.

It’s not sexy. But it’s the right way to “trade” for me. Almost everyone who isn’t a day trader still thinks holding something for a few weeks or a couple months is still VERY short-term. And it is.

For me, the removal of the stress of watching those 5-minute bars and the growth of my trading account when I stopped doing that proved to me that I was on the right track.

I’ve also found my best trades just by paying attention to what was going on in my daily life.

I’ve been a Verizon customer for at least 25 years. Service around my neighborhood has always been awful. I called and complained over the years and just kept hoping they’d add a new tower nearby someday. It never happened. A couple neighbors had T-mobile and said their deadzones were actually getting better.

At the end of last year, I made the switch. I could see Verizon just wasn’t investing in their network and my guess was they were losing customers just like me because of it. I shorted VZ for about 4 weeks and made another 25%.

Does it always work? Of course not. But for my risk tolerance and stress, it’s the best way I know to profit from things I see around me.

I’m working on my next 4 week trade now. Stay tuned…