Helium and Gravity Trading and Portfolio Protection

A trader/investor (TI) can learn a lot from charts. By tracking (every trading day) a six month chart and four important technical indicators:

• chart trend – look at the 13 day, 50 day and 200 day exponential moving averages (ema)
• stochastic
• MACD
• Force Index (Read “Welcome to my Trading Room” for more information)

A TI can develop confidence when placing trades.

Some investing adages that the TI wants to remember include “the trend is your friend”, and “bulls make money, bears make money, and pigs get slaughtered”. On a very short term basis (one to two days holding), the Direxion 3X leveraged vehicles are good trading vehicles in a bullish, bearish or neutral environment. The Direxion 3x use leverage and are prone to value/time decay, and should not be used for buying and holding, only trading.

Some guidelines:

• Invest about 75% in equities and the remaining 25% in money market accounts or cash for trading and portfolio downside protection; this will allow the TI to trade bullish, bearish or neutral (specifically alpha neutral – explained in a future post)

• Of the 25% in money market or cash, trade about 33% based on the trend using Direxion 3X leveraged vehicles.

Using a two – three day change in slope of these indicators, the TI can trade based on whether indicators are bullish, bearish or neutral, as the following chart example shows. To discuss, send me an email at:

Email  -  future.value.max@gmail.com

Trading, Investing and Portfolio Insurance

Recently, many of my friends and family have been discussing how to invest and protect their hard-earned money to save for their retirement, children’s education, weddings and a host of other activities and events that require large sums of money. Most are concerned about market swings and corrections, and many have discussed whether they should turn their money over to a full-time investment advisor. I do not know what’s best for any one individual, but I have always felt strongly that I work hard for my money, and I do not believe that anybody cares more about my money than me. For this reason, I have been a student of the equities markets over the past two decades.

My father nurtured my interest in investing in 1987, and my father-in-law introduced me to trading in 1997. Over the years I have made money and lost money using a combination of stocks, mutual funds, and options. As my children get older and college is now in the single digit years away, my interest has turned to better managing and controlling investment risk and maximizing investment returns. Over the past twenty years, I have morphed into a trader/investor, or TI for short.

Both investing and trading require strict discipline, using a longer timeframe and shorter timeframe respectively. As a trader/investor I use three primary methods to mitigate portfolio risk and maximize returns:

• dollar cost averaging (monthly, long-term investing)
• value averaging (monthly, long term investing)
• trading (as dictated by the “helium and gravity method”, explained in a future post)

Blackberry Curve 8330 – Thoughts

All my life I’ve enjoyed using new electronics, computers and gadgets. I used smart phones in the early 2000s based on Windows Mobile and with earlier Blackberry platforms. Recently, I purchased the Blackberry 8330 after considering the iPhone and other options, and needless to say, I am amazed by the Blackberry 8330. I continue to find new uses and 8330 features every day. The phone, SMS and email functions are solid, as is everything else. I added an 8GB sdhc card, and now have more room for pictures and video. One of my favorite applications is Barnes and Noble eReader for Blackberry. I have a number of books sitting on my sdhc card that I can read whenever and wherever. I know the iPhone, Droid, Palm and Windows Mobile devices are strong, but the 8330 is impressive.

Dropbox Review

We implemented Dropbox into our business development and proposal workflow in mid 2009. After heavy use, I am impressed with Dropbox’s features, ease of use and pricing. Dropbox has increased our team’s productivity through collaboration and ubiquitous file access. It has a “Recent Events” feature which makes it very MS Sharepoint-like in terms of keeping the team informed, and administration is very simple. Dropbox’s web interface and versioning are first class as well. Good job Dropbox – keep innovating!  Check it out at:

www.dropbox.com

Health Insurance – Health Savings Accounts

In 2009 under President Obama’s administration, one of the most politically charged issues in the United States is health insurance and healthcare. One of the best health insurance programs that seemingly few people are aware of is the Health Savings Account (HSA). My family started an HSA in 2004 coupled with a high-deductible health insurance plan. Depending on your healthcare needs and investment risk tolerance, you can maintain the HSA funds in cash/money market or invest the funds in the equity markets through a HSA administrator. A good place to learn more about HSAs is the U.S. Department of Treasury’s website:

http://www.ustreas.gov/offices/public-affairs/hsa/

The Power of Social Networking

Due to the nature of my father’s job, through my senior year in high school my family moved about 15 times throughout the United States and around the world. I made good friends everywhere that we lived, but unfortunately, lost touch after we moved. Recently, through the power of social networking sites like Facebook, Twitter and Linked In, I have reconnected with many old friends who I would not have been able to easily find without these wonderful websites. I would  like to say thanks to social networking websites for enabling me to reconnect! If you have not already, you should check out:

www.facebook.com

www.twitter.com

www.linkedin.com

Lunch with President Elect Obama and Mayor Fenty

January 10, 2009 is a day my family and I will remember forever. My wife, sons and I went on a trip to DC to tour the Smithsonian. We stopped for lunch at Ben’s Chili Bowl, and within a few minutes of standing in line to order our food, President Elect Obama and Mayor Fenty came into the restaurant to eat their lunch! Both President Elect Obama and Mayor Fenty greeted all the patrons and shook everybody’s hand – they are two very impressive leaders, indeed! It was a meeting we will talk about and remember forever!

 

Federal Continuity Directive – FCD 1 and FCD 2

Over the years, I have had the pleasure to work with a number of companies and talented consultants/subject matter experts to provide business continuity, disaster recovery, continuity of operations (COOP) and continuity of government (COG) planning services for government and commercial clients. In summary, we work with our clients to produce a comprehensive, actionable and cost-effective continuity plan to enable them to save lives, protect skill sets and get back to serving customers and achieving their mission after an emergency or disaster.

In the federal government space, for years the primary documents that provided guidance on business continuity, disaster recovery, COOP and COG included:

• The Computer Security Act of 1987
• OMB Circular A-130, Management of Federal Information Resources, Appendix III, November 2000.
• Federal Preparedness Circular (FPC) 65, Federal Executive Branch Continuity of Operations, July 1999
• Presidential Decision Directive (PDD) 67, Enduring Constitutional Government and Continuity of Government Operations, October 1998
• PDD 63, Critical Infrastructure Protection, May 1998
• Federal Emergency Management Agency (FEMA), The Federal Response Plan (FRP), April 1999
• National Institute of Standards and Technology 800-34, Contingency Planning Guide for Information Technology Systems

In May 2007, President George W. Bush published an important nationally focused continuity directive:

• NATIONAL SECURITY PRESIDENTIAL DIRECTIVE/NSPD 51 and HOMELAND SECURITY PRESIDENTIAL DIRECTIVE/HSPD-20

In February 2008, the Department of Homeland Security released these two federal continuity directive (FCD) documents, which will affect all Executive Branch Agencies under the United States federal government:

• FCD 1 Federal Executive Branch National Continuity Program and Requirements
• FCD 2 Federal Executive Branch Mission Essential Function (MEF) and Primary Mission Essential Function (PMEF) Identification and Submission Process

These documents are intended to supersede FPC 65 and FPC 60, and as a result, our clients have been asking questions including, but not limited to:

1 – What is materially different among the legacy PDD and FPC documents and the new FCD?

2 – How will the FCD(s) affect my organization?

3 – When does my organization have to comply with the FCD(s)?

4 – What are the specific FCD compliance requirements?

To provide these answers and more, we have developed a paper “The Practical Aspects and Implications of FCD 1 and FCD 2 on You and Your Organization”. Our intent is to keep this document “open source”, adding lessons learned and best practices from the industry as the FCD is applied and evolves. If you are interested in receiving this timely paper, please send an email to:

fcd1and2@amicususa.com

please send your feedback, edits, comments and modifications to this paper via the same email address and your valuable input will be incorporated into future versions of this document, and with your permission, you will be added as a contributor.

The SWOT Analysis

On a recent client engagement, we were asked to develop and discuss a number of strategies for our client from both an operational and financial perspective. As we started developing the report, we needed a framework to capture and present this important information. Although a number of strategic tools were available, we used the strengths, weaknesses, opportunities and threats (SWOT) matrix. We have applied SWOT analyses on dozens of engagements, and we find that it continues to be one of the simplest, most effective strategic tools in the management consultant’s toolbox. If you need a strategic framework, consider the SWOT matrix – its power is its simplicity!

 

Operating System Virtualization

Linux is becoming my operating system of choice, but many of my clients have standardized (?) on Microsoft Office for document handling. Google Docs, OpenOffice, Abiword and other opensource suites are good for content development, however, I have found that Microsoft Word documents (at least through 2003) must be viewed and formatted using Microsoft Word prior to sending the deliverable to my client. Also, many of my client’s systems require Microsoft Internet Explorer for web access, and although I could use a solid program such as IEs for Linux, I need a robust IE environment to access certain client systems. This is where operating system virtualization shines! Operating system virtualization allows me to run a host operating system (Linux) and a guest (Windows XP). I have experimented with VMWare’s Player and Server over the past few years, but for the past year I have been using Innotek’s Virtual Box on Ubuntu Linux. Virtual Box provides a stable environment for my XP guest OS, and I can do anything within the virtual OS that I can do on a native Windows XP machine, including folder sharing between Ubuntu and Windows. With my Dell 640m and 1.5 Gb of RAM, the speed of both my guest (Ubuntu Gutsy) and host (Windows XP) is fast. Good job VMWare and Innotek for making virtualization easier for all that need it!