Tools in the Tool Belt

With a growing list of followers on Twitter, I've begun to realize that there is something that comes along with each tweet that I make: a responsibility for the information that I provide. There are folks out there that have taken the time, and interest, to follow me (and again, thank you for that) -- and so one needs to consider many things when posting. What message am I trying to convey? Is it valuable to anyone else? Will they care, etc.

My reason for pondering on this today stems from several emails/tweets that I received over the weekend that centered around FOCUS. I am increasingly asked questions regarding how I can be focused on a variety of uniquely different trades - especially if they are in play at the same time. I wonder sometimes myself!

All kidding aside, I want to address the issue of Focus. I could spend a lot of time addressing each type of trade and why I utilize them, but for now I will generalize each type as a "tool in the tool belt". As is true with using tools, each one is designed for specific tasks. A screwdriver, well, you use it to screw in screws. A hammer, you now what to do with that one. The same holds true with a type of trade. A knife catch takes a certain type of preparation and execution that is vastly different from a Breakout play. Obviously a stock has to be in a gapping down situation for the knife catch "tool" to be used.

So I have several "tools" out and I'm using them to build a portfolio. In order to focus on each trade, I utilize a Trading Journal that is built within Excel with numerous columns. I specifically designate each trade appropriately, and have a ranking system that I use. This Trading Journal includes special columns that are unique to each type of trade, like a different price alert setting for example. This is one way to stay focused on my strategy and goals for each trade. In terms of how I manage each trade, I've learned to keep seperated trading accounts. My swing account is used for trades over 2 days. The options account is for option trades. The Long Term account is for stock that I want to hold and sell calls against. My daytrade account is used for quick intrad-day trades that come up during the day.

By using a properly designed Trading Journal, seperate accounts, defined strategy for each type of trade this should help in managing a portfolio of trades. This should improve your Focus.