Monday, November 29, 2004


I need to come up with a consistent format for these reports I publish every time a stock actually sells.

I try to deposit cash into my account every week. I don't think it's particularly meaningful - saving money is admirable but not particularly noteworthy.

I bought 50 shares of GCO on 11/18/2004 at 29.20. These 50 shares sold today at 30.23.
I paid $22 in commissions. Doing the math:
50 @ 30.23 = 1511.50
50 @ 29.20 = 1460.00
That's $51.50. Subtract $22 for commissions and I made $29.50 profit. It took 10 days for my price to hit and the trade to execute.

The noteworthy part is that this was a solid 2% profit in ten days. It would have been a 2% profit whether or not I had invested almost $1,500 or $15,000. I just can't say it enough.

This was the 5th time I've sold a stock for a 2% profit this month. By God's grace, there were no losing trades this month. (But be prepared - statistically speaking, it will happen!)

I'm going to try to do the scorecards in this same format. Is this helpful to you? Does it help you see what you could do? If you have any other suggestions, please let me know.

I started to cut and paste the courtesy email notifications I got today but they contain a lot of personal information! Maybe I could print them, black out the account numbers and full names (I don't want my boss to find me here - not yet anyway!) and scan them.

If I had found this blog five years ago, I think I would have been skeptical. Even if there isn't a stock report for sale!

Speaking of quitting my day job ...

My husband and I had a great discussion yesterday while driving around the city ...

He's NOT a risk taker! He doesn't like change! He likes it when I work - he even dared me to earn more than he (and he wasn't kidding!)

So I asked him, if this continues to grow, how will we know when I can quit?

I think he's been thinking about it as his answers came quickly. I liked his thoughts and had a few of my own!

Here's what we came up with:

  • No outstanding balances on any credit cards.
  • Will our budget change when I leave my day job? For example, will we still want to have a housekeeper?
  • Should I pay off my car loan first?
  • We need to decide if we want to increase the amount of emergency savings we have and if so, how much should that be?
  • What will be the time frame for which we average the amount of income this account is learning? This may be important as I'm now paid weekly.
  • How much money should this trading account have before I leave my job?
  • We need to shift our budget allocations so that all non-discretionary spending comes from his income (he loves his job and doesn't want to retire early. He's good at what he does, earns a lot of money and gets bonuses.)
  • How do we test our results against down markets as well as up markets?

Fortunately, we usually agree on things like this and it was a great conversation. We know it's way too early to even know if we are asking all the right questions. I'm glad we are beginning though because it's giving us a vision for keeping expenses down and seeing that it's not all about earning more.

Some remarks sparked by a comment ...

850 visitors have come by and some of you are beginning to email and/or leave comments. Thank you so much! It feels good to know that someone is reading! I'm not pretending to be any kind of expert (and believe me - I'm NOT!) I'm not sure why I have a need to write about what I'm doing - I want to talk about it at work so badly I feel I'll explode! I think part of it is bouncing ideas off other people and learning from each other. There's also something exciting about being around people who have a goal to do something more than simply show up for work each day. If I was passionate about my job and felt like it was accomplishing some real work, I don't think I'd feel so frustrated. But (and I know this sounds arrogant but somehow I think you probably feel the same way with respect to yourself) I have better things to do with my time.

Leisel left a comment asking how taxes will affect my earnings. She raised some thoughtful issues such as the fact that I'll be paying higher taxes since I'm not holding for the long term. And she's absolutely correct! I'm not up on the current laws; I know it used to be that you paid a lower rate on gains if you held the stock for 18 months.

I designated the money in this account to hopefully become the funds that will generate enough money so that I can leave my job. Since this is designated for replacing my income, it can handle paying any taxes that are due. As my accountant said, "You only have to pay taxes when you are making money and making money is a good thing!"

Seriously that does mean that I won't be able to quit my day job until this money generates enough income to cover the cash I'll need including the taxes!

I'm also reading up on some ways to channel cash flow in a different way so that taxes will be paid last - not first. The book "Rich Dad, Poor Dad" has some interesting ideas along that line but I'm not sure I agree with them! I definitely won't try anything without checking with my accountant and possibly an attorney as well. Some of his ideas sound too good to be true and some of them sound a little risky to me!

We have other savings and investments including two 401K plans and we live on a budget. I just don't want you to think I've fooled myself in that this is my primary investment plan!!

Plan the work and work the plan!

GCO briefly hit above 30.22 this morning and my sell order for all 50 shares executed at 30.23.

Total cash after the sell (this was my only position in the account):

I quickly checked IBD for the stocks moving up in price on high volume. This is featured on the front page and available to all. I started looking at the stock checkups on each one. PARL was way up and I could have bought more shares (helps you get to that 2% point more quickly as you need to make less money to cover commissions) but I wasn't happy with all the scores. This is for luxury fragrance and the sector wasn't doing that well. Remember, part of my plan is buy stocks I wouldn't mind owning should it it stall. I want to be able to sleep at night!

I liked the fundamentals for NGPS the best so next went to Big Charts to look at the chart. I have been learning a little about technical analysis and probably know enough to be dangerous. I can't get enough of it though. To me the checkup on fundamentals guides me to what stock to buy. The technical analysis tells me if it's a good time to buy this stock. The chart shows a clear uptrend. My husband and I argue over charts like this. He says it's gone too high; the stock costs too much. I say it costs a lot because it's performing. I did look at the MACD and made a note to self to learn more about these indicators. That indicator was up.

The overall market is down. I took a deep breath and decided to buy anyway. I bought 75 shares that filled at 26.14. A couple quick computations gave me the sell price of 26.93 (enough to cover commissions and give me a 2% gain.) I entered a sell order for that amount with a GTC (good until it's cancelled) and updated this blog.

Now time to eat some quick (free) leftovers and head back to the office where things are NOT going as well. Thankfully I'm just a team member and the problems we're having aren't my fault. I hate it anyway and just had my priorities yanked again.
I love the people I work with and recognize that these are things out of our control.
I can't wait for freedom day!

Sunday, November 28, 2004

Learning to trade stocks - a free on-line stock market game

I found Stocks Quest a supposedly free on-line stock market game while surfing the other day.

It looks informative; I tried to check out as much as I could and found the pages were slow to load. I have a fast connection so that was disappointing.

It looks like the game could be fun to play (you get a default 100,000 to trade if I remember correctly but that amount could be over-written.) You make "real" trades and see how you fare.

If anyone has had experience with this site, please let me know.

Perhaps it's better than paper trading.

Saturday, November 27, 2004

Saturday Scorecard

Value of stock: 1492.50
Cash: 602.09
Total $2094.59

The value of the stock I own is as of the market's closing on Friday. The stock is up and close to its selling point. Cash is up as my husband gifted me $500. This rarely happens by the way; I had missed buying a stock waiting for funds to settle. This settlement time could be bypassed if I was approved to trade on margin. Another requirement was a minimum of $2000 in the account. He gave me $500 to bring it up. My husband is tight and his vote of confidence was a real shot in the arm for me.

At these levels a successful trade yielding a 2% increase nets about $35 (you can't trade the entire amount as you can't buy parts of a share - I'm estimating right now I'll be plopping down about $1500 a trade.)

Now when I see an opportunity to save that much money and invest it, I grab it. I guess it's a different perspective of the worth of $35.

On December 31, I'll compute the percent increase of this account after throwing out all deposits.

The financial shows on Fox News this morning were all positive. Everyone is talking about a Santa Claus rally! No matter what the "news" is, I aim to stick to my plan. Find quality stocks that are on the move. Buy and sell as soon as they increase 2% plus enough to cover comissions. Or should the trade go the other way - sell if the stock drops by 8%.

That's all folks! If I don't get on line tomorrow, have a great Sunday!


I watched TV with my husband this afternoon while we shared lunch. I'll bet you can guess what we had! Why is it that the good Thanksgiving casseroles taste even better warmed up? The gravy was incredible this year so we also warmed sliced turkey in the gravy and made hot, open faced sandwiches. It's finally cold here and both of us had just come in.

One of those Mastercard "priceless" commercials aired - $29 for the toy then it flipped to the cute shots of the baby playing with the box. "Playing with the box ... Priceless!"

I thought our meal was priceless - you can't go out and "buy" the good leftovers - the ones that fill your whole house with the smells of good home cooking. Better yet, our lunch was free!

I thought of another priceless day we shared this year - our grandson came over and our plans were to take him to ToysRUs as there was a new game we wanted to get for him. All the whirley bird leaves had fallen onto our back patio and he begged to stay and play with the leaves. He told us they were helicopter leaves and showed us how to throw them up in the air and watch them twirl and they fell to the ground.

We all forgot about the store and played outside for hours seeing the world fresh again through the eyes of a child. Later that night, my husband and I talked and talked amazed that it was becoming clear to us that the one big area we had failed our own children in was taking time to just play.

As we continue to enjoy Thanksgiving weekend, consider leaving a comment sharing your own "priceless" times or experiences. As I continue my work to financial independence, I want to stop spending money on things that wind up enslaving me and find more time to see the priceless things in life. This may be a thought that will make you richer too!

Friday, November 26, 2004

Black Friday in Atlanta

We had a great day with our son and his girlfriend in Atlanta. The day was sunny and clear and spirits were bright.

One reason I try to post about what I'm "doing" on a day to day basis is to make the point that I'm living my life while my method of earning money in the stock market is working away.

Today my stock rose again closing within 20 cents of my sell point. GCO's chart shows a continuing trend line of rising even if it isn't happening as quickly as I'd like. I chose a quality company that I don't mind owning while this plays out. In the meantime, I'm free to work my day job (oh well!), play with my family and even go out of town. I don't have to sit in front of a monitor watching every move the market makes.

Tomorrow, I'll post a weekly score card. I'll have to go in to work; they are powering down the main computers for electrical upgrades and I'll be paged (along with many other IT people in our company) when power has been restored. We'll all go in and confirm that our systems are running so that things will go well on Monday morning when the regular employees return from the long holiday weekend.

Have a great weekend everyone!

Thanksgiving Holiday

I hope you had a great Thanksgiving!

We had a delicious feast yesterday! The book "The Best Recipe" detailed a roasting technique that worked really well for us. The food was fabulous; family gathered around (including my siblings from two different states) the table made the day merry! We're heading to Atlanta to visit my son and his significant other. She received devasting news last Wednesday that her sister has melanoma - a dangerous form of skin cancer. They opted to spend the day with her so we'll visit them today.

This was our second year roasting a free range turkey - they are delicious!
GCO had a decent run Wednesday and I'm hoping that it will sell today (though the trading volume will be light due to the holiday weekend.) I'm also hoping my son has a laptop with wireless access. Knowing him, he'll want to spend the day out and about the shoppers in Atlanta. I used to deal with shopping by finding a mom chair so I could read; now I need a laptop! Maybe I should talk to Santa! (Ladies - the Santa at Lenox is a flirt - wink at him as you pass by and you'll see what I mean!)

Wednesday, November 24, 2004

So what's the deal about quick 2% gains?

Let's go back to my amount on deposit on January 1, 2004.


To some people that is a lot of money! I'm guessing it's about one house payment to most people and only then if you don't live in NYC or the west coast. The reality is that one couldn't live in America for very long on that amount of money.

In other words, I won't be living off THAT any time soon!

Honestly, in most circles, this isn't even worth discussing in terms of buying and trading stocks.

But let's say I'm going to invest it anyway and I buy a solid stock in a well known company. I want to buy and hold it in hopes that it will go up. I want to become financially independent.

Let's say I get really, really lucky and by the end of the year this stock is up 50%.
I'll have holdings valued at $1841.50 and possibly some extra (if the stock I chose paid a dividend.)

What do you think the chances are that I'll actually find a stock that will go up 50% in value?

Now - let's say instead that I take that money, buy a stock that is on the move and sell it as soon as it reaches a 2% gain after commissions (let's just assume that's 3.5% total gain for each trade.) If I do that 32 times in one year (about 3 times a month), I'll have $2,334.31. That's a 90% increase. If I continue to make that number of successful trades, the effect will snowball as I'm compounding my earnings back in with each trade.

What are the chances that I'll actually be able to do this three times a month? I'm not sure ... Statistically, there's also no way I'll be able to do this without ever having one that goes against me.

I've been doing this seriously for one month now and I'm up approximately 17% for the year.

Like I said, follow along and I'll report my progress honestly and regularly.

I learned a lot of this from Gary B. Smith's columns (when they were free) on I combined this with the CANSLIM method taught in the newspaper Investors Business Daily (and available on line - I do pay for this service.) I'd gladly pay for Gary B's if I could afford $100 month! You can catch Gary on FoxNews Saturday mornings at 10. He's a regular guest on Bulls and Bears. He is my investing hero and when I get to the point that I can afford to pay for his columns, I will do so gladly!

Scorecard Methodology

I'm always afraid I'm just playing games with numbers and honestly sometimes I do (I'm really not up three pounds because I'm weighing in the afternoon ...)

Posts titled Scorecard will be as the previous Scorecard post in this blog. What I had and when I had it. I'm going to publish a Scorecard every Friday and every time I actually sell a stock.

But I also want to do a quarterly assessment to evaluate my trading success (or lack thereof.) There is no sense continuing this if my trades aren't successful over time.

I decided for these quarterly assessments that I will start with the January 1 beginning balance and throw out any deposits I have made for the time period I'm evaluating. By comparing the ending balance minus deposits I have made, I'll be able to compute the percent increase or decrease.

I am not throwing out inactivity fees charged to my account or commissions. These are the cost of doing business. Inactivity fees are charged when a balance falls below $2000 or less than 4 trades are made per quarter. I am not going to be forced into trading when I feel like the market is down and I need to face these fees.

So my first assessment of this type (and I'll repeat it at the end of each quarter):
Beginning balance: 1227.67
Ending balance (less deposits): 1437.09 (as of today's market rate at closing since I do hold a position)
I'm up 17.05% for the year.

I don't know about you but I'm psyched!

Tuesday, November 23, 2004

Wow! So close!

I took the day as a vacation day and watched the market a little this morning. I was fascinated, as always, but had a hot date with a certain little grandson. His mom is in New York and I was invited to take her place at the Thanksgiving feast hosted by his preschool!

We had a blast and dad let him skip school for the rest of the day and tomorrow allowing him to go goof off with us! We went to the natural foods supermarket we frequent to pick up the organic turkey we ordered. A TV crew was there covering "alternative Thanksgiving dinners" and Connor and I were interviewed on camera. It must have been a slow news day! (And I'm such a dork I didn't even think to ask what news channel this was!)

We stopped at Panera for a snack and started chatting with a young girl who was on-line using her laptop. I was dying to ask her to check a quote for me but decided that would be extremely rude! She was sitting by the fire, sipping her latte and ordering plane tickets. (Note to self: Get a laptop for crying out loud!) Connor and I did try to check a quote using my cell phone but the menus had changed. My cell company charges an awful lot for web minutes - Connor was asking about stock quotes and decided it was a stocking (a la Christmas stocking.) Yea kid! That's exactly how I want to think of it!

We got home a little later than planned and I went straight to the computer to check the stock market. Oh so close! If you'll recall, the sell point is 30.22. You can check out today's action here.

I can't wait for tomorrow! There will be the market to watch, pies to bake and one really cool kid to dote on!

Monday, November 22, 2004

Moving Sideways

Today was a normal day except I didn't make it the gym. We are so excited about the holiday week and we're being slackers!

I had to go into the office today and checked a few times. At first the market was down (and so was GCO.) I write down the following information when I buy a stock to trade:
Purchase date
Purchase price
Sell price
Stop price

I had to open my day planner (where I keep the current trade info) and make sure I wasn't getting close to my stop price.

I ALWAYS sell if the stock I bought dips to 8% below its purchase price! Okay confession - once I didn't and I rode that loser down to the ground!

Thankfully the market started going up (and so did GCO.) I didn't hit my sell point but I didn't have to bail at a loss either.

Note to self:

Remember I warned you that I'm not a professional ...

I read some this weekend about a sluggish holiday trading week being anticipated. (It probably would have been better not to put in a buy order the Friday before Thanksgiving week!)

In spite of my inexperience, I'm working the plan. I DO have a position with a sell order in place. If the stock reaches 30.22 (a 2% gain plus enough to cover the commissions) the order should initiate. My husband is home this week and he agreed to keep an eye on it. Should it fall by 8%, he'll sell it for me. The most important thing is to protect the capital and then to make money of course.

An interesting observation: I traded on paper for a long time before opening an on-line account. I always said "assuming these trades executed" when showing someone the results. I figured a bit player like myself wouldn't necessarily get the trades. In other words, just because the stock hit that price that day didn't mean it executed.

I watched the data during my last trade and was amazed that as soon as the stock hit my price, the sell order hit and executed. All for just 35 shares.


Sunday, November 21, 2004

Learning HTML?

If you want to learn HTML or need additional resources, Stones Cry Out has posted some links.

A day of rest

My daughter and I have been discussing women who want to work from home. She says I got it wrong. She's a SAHM and says that every mom she knows is going nuts and they want to run a business from home. She said it's not so much making tons of money (though no one would turn it down) but it's more of having a mental challenge.

I'm in the corporate world and all the moms I know want to work from home making some decent money. They long to be home mainly to spend time with their children but also to make homes for their families. Most of them are locked into their jobs as they help support their families in a significant way.

Where do you fit in? What kind of information are you seeking? What are your goals and/or dreams?

I have experience in working from home doing actual labor for others (several jobs including typing in the 80's, writing computer programs and providing childcare.) I also ran a small Internet business for several years. It broke even but provided large tax breaks resulting in sizable (and legal) tax refunds. I learned a lot from that experience and would love to talk about it. Now I'm seeking to find a way to churn out dependable income without having to be at the computer 8 hours a day. The avenue I'm investigating is stock trading. I also know some people working from home in different capacities.

I can see that lots of you are stopping by; if I get any comments or questions, I'll see what I can do about coming up with information for you to read on this blog that may meet your needs.

Are you a SAHM who wants to make some money on the side? It would be so easy to get discussions going that will give you some viable ideas.

The main thing I want to say here is that the little person can be enpowered to have a business or invest. You don't have to have tons of money to start earning some money with your computer - just look at some of the successes on eBay!

I hope to hear from you and hope some great discussions get started!

Saturday, November 20, 2004

Financial Basics - The Magic of Giving

My children's father dumped us with no money. I had $7 and gave away 70 cents the first chance I got. I believed in God and was afraid and desperate. By the grace of God, we've been able to continue that practice for nearly all of the past 20 years. I've never regretted it. Our financial picture has steadily improved and our giving has increased. God challenges people to try this concept in Malachi 3:10

I remember the very early days - the kids never missed a meal but our living conditions weren't so hot. We had a roof over our head and lived in East Tennessee. It was okay until it snowed and the pipes burst. I cried, prayed and wrote in a journal all day. My car wouldn't start, the phone was dead, there was no running water and I had four children - three under the age of five! I prayed for a car so I could get to work and wrote it down. The thought "you need to pray for decent housing" kept coming in my head but I resisted it. I kept thinking "there is no way! I'm asking for too much!" I couldn't push the thought away thinking my kids need simple basics like running water. I wrote it down adding "decent housing" to my list as I contined to pray. Somehow we made it through that day. Six months later I found that journal and was stunned as I read those prayers. By then, we were living in married student housing (that's where single mothers were also housed) at the University of Tennessee in Knoxville. I had a small dependable Honda Civic. I was in college making the dean's list!! I just wept as I saw how God was answering our prayers - He is real, alive and actively cares for us. But I also believe His answers were a direct result of giving. All the dynamics of our situation changed as I gave a small portion of everything that came to me. I was enpowered and not a victim. I was a giver and encouraging other people. Any time now that I'm asked to talk to a single mom, I start with giving. It sounds cruel but it isn't because God honors His Word. If you want your financial picture to improve, that's where to start. If you feel overwhelmed, start with just a little - keep track of it and just start trying.

You do have a responsibility to give to God's work. Please don't just pick out a TV preacher and start sending them your money. You need to start by supporting your local church. If you don't have a local church, maybe you should consider visiting one! The point is you need to be involved, you need to know where your money is going and you do need to give. If you are in much difficulty, start with a little and then increase your amount as your situation improves. Write down what you do and write down your prayers! Get prepared to see God move!!

I have to say my prayers (then and now) were not just about money. I'd ask God to show me what I needed to know and what to do. I'd ask Him if I was measuring up. I'd ask Him to check my heart. And many, many times I'd forget to pray or crowd that out by the everything else I was doing.

Now I'm amazed to see that virtually every secular book on finances recommends giving to charities. Many of them recommend giving generously. Pick one up next time you are at the book store and see if you can find something on giving.

There are so many scriptures about this. I believe those scriptures are promises and that God keeps His promises. I believe these promises are general principles like you reap what you sow. I don't believe they are contractual agreements to provide me with a Benz just because I give 10%. (I always think of a Mercedes, I guess, because I liked that song by Janis Joplin when I was in high school! He didn't owe me a Benz but I am fortunate in that I own a nice car.) has tools to research any word in any version of the Bible. It's amazing to see how much Jesus talked about money. Try doing a search on some key words concerning money and see what you find!

Friday, November 19, 2004

What a day!

My order for 50 shares was filled at 29.20 (definitely the high price of the day.) The stock fell in price very quickly and continued to fall (though more gradually) for the rest of the day. It closed at 28.74.

The market was down. My stock was down. Everything was down except the picks the hotshot new guy had (course he's only trading on paper but who's counting anyway?)

I wondered if there was news - there was - GCO announced higher than anticipated earnings on the 18th (record earnings?? Go figure! Seriously people were taking profits.) I also found out it was triple witching Friday (and I only know enough about THAT to be dangerous!) I kept thinking that if any professional traders had stumbled on my blog they were being gloriously entertained by everything I wrote. I could see them all passing around the laptop at Starbucks (no one else would be dumb enough to actually be on the trading floor today) laughing so hard their sides hurt.

But really how was this day for me? It was okay - the hardest part for me is to decide what to buy. Once I've placed a trade on-line, I can relax. I don't have to worry about when to sell - I already made that decision and keyed in my limit order to sell as soon as the buy was filled.

I check the price on my stock several times a day just in case it breaks down so badly I have to get out of it. I already know that statistically this can happen so there's no point in worrying about it. I'm keeping up with data and finding better ways to analyze what I'm doing. If I consistently lose money, I'll admit defeat and stop.

Now somewhere there has to be a website showing when these triple witching days occur (all I know is that has something to do with options expiring in the market.) I need to learn more and I want to learn more!!

Oh I had a productive day at work in spite of the mocking whiz kid. I wrote some new computer programs, fixed problems returned from my tester and got a final package ready for production. I really was worried that I'd be too absorbed by the market to work. I think I get more distracted when a stock is going up and moving quickly. It is fascinating to watch the data especially when it signifies that you are making money!

GCO - The deed is done!

I got up at 5:30 thanks to my disciplined husband (who has lost a ton of weight and is getting into terrific shape!) I bowed out of the gym choosing to do step aerobics while catching Fox News and CNBC headlines. (I made it for 20 minutes - yeah me!)

Next was what I call quiet time - I'm reading the "One Year Bible" and the New Testament selection finished the book of James. My days are never right when I miss this time of reading, reflection and prayer. I feel like I have help for the challenges I face that just isn't there when I skip this time. I love the book of James! Chapter 1 has a classic section of asking God for wisdom with single mindedness and purpose. A scripture that I memorized is James 2:26 - it always cuts me to the heart: "For as the body without the spirit is dead, so then faith without works is dead also." I have to ask myself hard questions - Are we giving to the poor? Are we taking time to be a real friend to those around us? If a homeless person came into our church, would we sit next to him or her as easily as the people we know? What if the wealthiest man in town came in? Would we treat him any different? These aren't easy but have made for great discussions in our Bible Study group on Wednesday nights.

The futures were mixed (Dow futures up slightly, Nasdaq down slightly.) I have to be honest and tell you that I don't know how to interpret this data. I decided to go ahead and enter a market order for 50 shares.

I also applied for margin trading; again the purpose of this is so I don't have to wait for each trade to settle before my own funds are available for trading.

I'm nervous - I always am. I'd feel better if I could go on-line and see how the market opens. From the looks of the quote I got after keying in my order (I don't do extended trading hours by the way - again I just don't think I'm sophisticated enough) the stock will be up this morning. I just hope I don't buy at the high of the day!!

I'm NEVER nervous about keying in a limit order for the sale of a stock. It could go up 200% today and it wouldn't bother me - I know I could lose money just as easily (well actually more easily!) than make money. I'm content to get in and back out with that small gain.

Remember the goal of this trading is to gain capital and skill to produce income on a consistent basis. Right now, I'm in the high twenties range (I'm making around $28 - 29 on a successful trade.) I want to see this number rise over time and I want to see the number of trades that hit become more frequent.

Deep breath! Relax! Time to get dressed and go to work!

Thursday, November 18, 2004

A 2% gain or an 8% stop ...

One thing I forgot to mention. Although I will hold a stock if it goes down somewhat waiting for my 2% gain, I will not hold it if it falls below 8%.

Don't ask me how I learned the importance of this rule!!

Plotting My Next Move ...

First - I am not a stockbroker. I have no training in this. I have lost money doing this. I did this on paper for 6 months before I bought the first stock. I am not telling you to make this trade!!

I thought you might enjoy seeing the process I go through with a real trade. Again - if it just doesn't feel right in the morning, I may back out. Whatever happens, I'll report it tomorrow when I blog again.

And again, my trading account is money that we set aside that we do not need. We have paid our bills, given tithes and offerings, and invested in our 401 K and short term savings accounts. We take a little each week after all that is done and put it in this trading account. I have sacrificed for this - our home still isn't completely furnished and I don't have a lot of clothes. But you don't hear me complaining!!

I just checked and saw that GCO was up heavily on high volume. I checked the score card on that site and it's good. I learned this is a shoe company and my husband buys their shoes and loves them. Even better!

Next I went to and checked out its chart. I like to look at the graph a certain way and that site gives me the ability to see information in a way that makes more sense to me.
I LOVE this chart. It had a huge jump today gapping up (you'll see a blank space between where it closed from the day before and where it opened this morning.) Many times, the stock will continue to rise a second day and this is what I'm hoping will happen. There are no guarantees and that's why I checked to make sure this was a sound company.

I want to make a 2% profit then get out. The stock closed yesterday at 29.36. You can see from a quick calculation that it only needs to get to 29.94 in order for me to realize my 2% gain. I need to consider the cost of commissions. My on-line broker charges me $11 to buy stock and $11 to sell. I have about $1500 (actually I just saw that the $500 we sent in at the beginning of the week has also cleared so I'm going to do my calculations with $1500. You'll see why in a minute.) Rounding up to $30 a share, I can buy 50 shares. I divide $22 by 50 shares. I get .44 which I add to the total. As soon as I can get to my computer after the market opens, I'll check my fill price (the price I actually bought at) and add another two percent plus .44 . I'll then key in a limit order instructing the on-line broker to sell my 50 shares at that price. ($30.38 if the I get to buy at its closing price of today.)

I'm going to key in an order to buy at the market. This is risky but I have to go in the office tomorrow and I can't buy stocks on line from work. It's risky to just buy at the open as one usually doesn't get the best price. But that's the price I pay for starting as a very little fish in a big pond! That's also why I'm leaving money in my account - I don't actually know how much it will be selling for in the morning and I want to make sure my order executes.

I usually get up at 5:30 am to go the gym. I'll turn on CNBC while I lace up my tennis shoes and look at the futures. If the DOW and Nasdaq futures are up, I let the order stand. If the financial climate seems bad, I may cancel the order - I'll have till 9:30 in the morning to cancel.
If horrible news surfaced after 8, I might drive home and cancel the order (I live 3 miles from my office and I'm allowed to come and go to take care of an occasional errand.)

I made my last trade on a day when the market was down. It just "felt" right - I keyed it in at lunch after things had settled down and this stock was on a tear. I was in and out in one day with a solid 2% gain. It's really an art judging when to get in and even then, sometimes you are just wrong. In the end, it just needs to go up a small amount and hopefully, it will!

Oh and how much money will I make tomorrow if this goes as planned? A solid $30 for all my work. But this is the beautiful part - when it goes as planned, 2% is 2%. Whether I get 2% of a little or 2% of a lot of money, it really doesn't matter. If the stock hits my price, it will sell whether I bought 10 shares or 1,000. Once that fact really sinks in, you'll never be the same again!

I'm off to do the deed - watch the stock tomorrow and see if you think I got in and how I did! Any bets??


I will post a new scorecard after every deposit and trade. Be prepared - there will be downs as well as ups.

The point of a scorecard is not to brag. I'm trying to share how I hope to make money. I don't see many stock analysts posting their track record and I think they should.

I also hope it inspires people to see that they can start with a small amount of money. I actually started this on-line broker account with $500 several years ago.

1/2004 Stock: $1227.67
Cash: 24.13

11/2004 Stock: $1351.00
Cash: 48.20

Today: Cash: $1524.88

My trades have settled - woo hoo! I can try to get back in the market tomorrow!

I'm up 24.20% for the year. Realize some of this increase is because I have deposited some money to this account (and no - I am not going through an entire year of history to sort it out - at least not tonight!)

I do see that the percentage increase of stock holdings from January to November is about 10%.
I'm not sure if that's a fair assessment as I don't hold stocks in this account. I buy and sell at a small profit as quickly as I can.

But as I continue to blog my efforts, I'll always note when I deposit money along with the profit or loss of each stock trade.

Fair enough?

Getting ideas on what stock to trade next ...

I check every day. It shows what stocks are going up in price on unusually high volume. (The thinking is that the mutual funds are buying ... if more shares are being bought, it is likely the price will continue to go up. Also since professionals are buying the stock, it is thought that they know the company is good shape.) I click on each one and check out the company's scorecard. I won't buy if the score isn't 80 or higher (or a B or better) in each category.

Although I buy a stock with the sole purpose of making a small profit as quickly as possible, the trade may not go my way. That's why I want to be in a quality stock that I wouldn't mind holding if I have to.

If all this checks out, then I look at that stock's graph on If this is the first day the stock has had a big rise on increased volume, I usually go ahead and buy it. I listen to my gut too which probably sounds weird to some people. I'm always nervous but if I feel any calmness at all, I take that as another buy signal. I think gut feelings come from our subconscious pulling together all the data we've assimilated .. but who am I? I'm just a geek programmer - I'm certainly not a psychologist!

I have other watch lists and places to get ideas but this has been one of the most productive.

Oh and I pray over each one asking God for wisdom!


I'm still in a holding pattern waiting for my last trade to settle in my trading account. I also mailed in a deposit that will bring my account up to the amount qualifying for margin. I won't trade on margin (I think it's too risky especially given my training and experience.) It will let me trade without waiting three days to settle - I'll be able to execute one trade after another.

This waiting is icing me! I'm losing my nerve!

Another definition:
According to Rich Dad, Poor Dad" an asset is anything that puts money into your pocket. Your home doesn't qualify (that's an asset on the bank's balance sheet unless you have paid off the mortgage) and your car doesn't qualify (even if it is paid for it depreciates in value and costs money to insure and maintain.) One could argue that these things enable us to earn a living, but for the purpose of this discussion, they don't qualify as assets.

Making Money
Today is payday. On payday, I take my clothing and personal allowance money and deposit it in my trading account (unless I have actually profited this week in the stock market.) I did make money in the stock market (not paper gains but gains from a sale.) Since I don't need anything this week and the amount is my trading account is small, I'm going to deposit this money this week.
This ties to another concept I learned in "Rich Dad, Poor Dad." Your assets should pay for your luxuries. Your salary should pay your non-discretionary expenses and buy assets. I'm going to start making myself spend some money that I earn from my assets. I don't want to end up warped!!
So - I bought 50 more little green employees today!!

Saving Money
The company where I work held a nice company lunch for us today. It was run to get together with co-workers without having to pay for lunch! I stayed out of stores and have come home to work on redecorating the bathroom. A day without having to spend is a very good day indeed!! A day spending money that has been set aside to spend is also a good day and a lot of fun! I'm heating up food for dinner that I made several days ago. It's one of our favorite dinners and it gets better as leftovers. We really enjoy it and call nights like this "free dinners." Free from more spending and free from lots of cooking and cleaning - it's a real pleasure!

Wednesday, November 17, 2004

Holding Pattern

A little background and a few definitions:
I was dirt poor as a single, uneducated mom of 4. I was worse than uneducated - I was a high school dropout! I didn't even have a driver's license when my kids' father dumped me. I had $7 to my name when he left. I was scared to death. When you are that scared, you talk to God. Mercifully, God listened and responded. You also instinctly know what to do. I told God I would give Him 10% of everything He gave me, if He would make sure my kids would have what they needed. I didn't want them to ever miss a meal. He was so faithful! My social security statement is the data proving God's end of the deal.

Now I'm a bonafide grownup. I went to school, remarried, earned a degree and have been living the straight life. Our combined salary is in six figures. We have our checking, savings, another investment fund and a 401 K. We have a mortgage, two car payments and about $3500 on a low interest credit card. We have a decent home in good repair that badly needs decorating. We raised four kids and have three young grandchildren.

We also have a trading account. This account started with about $1000 saved from here and there. I learned to trade stocks with it and had some success. I also broke a cardinal rule by not selling a stock that started to go down. I kept cheering it on as it went lower and lower. I bought it at 47 and now it languishes around $2.50. I look at it every day to make sure I remember that the market doesn't know or care that I owned that stock. I have to respect the market. My husband called that money "tuition" and I'm very thankful he was so supportive as I continued to learn about the stock market.

I've slowly built it back up to $1200 by adding additional money and trading much more carefully. This is money we have identified as money that can be risked. If we lost every penny, it wouldn't hurt our financial picture. It is less than 1% of our total holdings. Whenever I speak of our "trading account" I am referring to this money in an on-line broker's account.

I'm sharing our story to show how an average (or in my case a below average person) can build wealth. I hope it works! I hope it inspires you to build wealth of your own!

Making Money
Starting is the hardest part. You don't have as much money to work with; you have more constraints. If I had $2000 in my trading account, I wouldn't be waiting for my last trade to settle. But I don't, so I didn't make any additional money today. That's okay. Thankfully I didn't do anything stupid either (like trying to trade the money accumulating for our semi annual insurance payment!)

Saving Money
I have a friend at work who wants to learn to knit. We went to a store today so I could show her what she needs to get. I saw the cutest book and supplies to share with the little girls in the class I teach at church. Before I knew it, I had my credit card out and I had spent $15. The good news is that card carries no balance. I'll pay the bill in full. I was aware of what I was doing and knew there was enough money designated for miscellaneous spending to cover the purchase. But why was it so easy to whip out that card and buy?? I need to try to stay out of stores!

We had fun though and my friend was a natural. She was knitting by the end of lunch!

Tuesday, November 16, 2004

i (Want to) Work From Home

Am I the only one who wants to chuck the 9 to 5 job in order to better care for my family and home?

My thinking is going two ways:
  1. We need to eliminate some bills and strike a good balance on how much to simplify our lives in order to speed along the process of becoming financially independent.
  2. I want to find a way to generate a dependable income without risking our family finances and/or turning our home completely upside down! I also don't want to be in a venture that requires me to pester friends, family and strangers to make sales.
I don't want much do I?

I got serious about this quest when I watched a co-worker start buying and renting homes after he read "Rich Dad, Poor Dad". That's not my particular gift but it opened my eyes to see opportunities around me. People in other countries risk their lives to come to America; folks we're here! My friend prospered in a big way and was able to leave his job in a little over two years. He was a tremendous inspiration to my husband and me. We believe one reason he succeeded is because he shared what he was learning with anyone who cared to listen.

As I continue to blog, I'll record what I'm earning over my salary (I work full time but am not saying much more - my boss might find me while surfing the net to find out how to chuck her own job!!)

Anyway for the record, I earned $18.78 over my salary today towards my goal of financial independence! (I bought and sold a stock today and that was the gain after commissions were paid.) Before you start screaming at me that I sold too soon for too little realize that I do have solid investments in a 401K with a long time horizon. The goal of the money that produced the earnings I just reported is to trade in order to produce income - money for now. One of my goals is to grow this money so that I can make quick trades resulting in a 2% gain after commissions. I'd like to learn to do this consistently and often. If you don't believe frequent 2% gains amount to anything, I invite you to sit down with a calculator. Take $1000 and add 2% to that amount. Take that total and do it again. And again. And again. (A spreadsheet is great for this exercise!)
How many times does it take to get to a million? Yeah that's exactly what I said!!

The money I made today (I emphasis today - this money was made in one day though it doesn't always work so quickly) was the same amount I made in an entire year by investing $1200 in a CD! I'm a firm believer in small but quick gains.

I won't be able to make another trade for several days, as this trade has to settle (a rule with on line brokers for those of you who don't trade stocks.) It generally takes three business days for a trade to settle and the funds to become available again to reinvest. I purposely started with a small amount of money and have watched it grow to the point that I want to share this process. I do not want to risk my family's money nor do I want to borrow.

Finally, I love and serve the Lord Jesus Christ. My hope and prayer is that I'll accomplish these goals without compromising my faith or integrity. I know there are many promises in the Bible about prospering as we live according to God's Word but I also know of godly people who suffered financially. I don't believe these promises are to be rubbed as little genies. I do believe that financial prosperity is given in order to better ourselves and others.