Lead column · Ledger
A 50% Loss Needs a 100% Gain, and That Should Change Your Rules
Losses cost more to repair than they cost to take, so set a maximum drawdown and cut size well before the hole gets deep.
4 min read
Columns
Each column argues one position about money, works a hypothetical account through the numbers, and says plainly where the argument stops holding.
Margin & Leverage
Everything on margin and leverage →-
Argument
Every Short Sale Is a Margin Trade, Whether It Feels Like One or NotSize every short from its margin call price, and plan as if the price has no ceiling, because it does not.
4 min read
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Argument
Treat Margin as a Loan Before You Treat It as Buying PowerRead margin the way the agreement writes it: a loan charged interest daily, from a lender allowed to sell your shares.
4 min read
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Ledger
Your Margin Call Price Is a Number You Can Work Out TodayWork out the margin call price when the trade is placed, write it in the plan, and put your stop above it so the broker never decides.
4 min read
Risk Management
Everything on risk management →-
Argument
Conviction Makes a Terrible Position SizeSize every trade from the account and the stop, and treat conviction as a reason to take the trade, never as a reason to make it bigger.
4 min read
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Argument
Graham's Margin of Safety, Rebuilt for a Trading AccountBuild a trader's margin of safety from wide enough stops, a cap on total open risk and unused buying power, and accept the lower returns it costs.
4 min read
Stock Trading
Everything on stock trading →-
Rulebook
Adding to a Winner Only Works if the Stop Moves FirstAdd to a winner only after the stop has moved, so the whole position risks no more than the first lot did, and only on a fresh setup.
5 min read
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Argument
Skip an IPO's First Day and Let the Chart Form FirstSkip the first day of an IPO and wait for a base or the first quarterly report, so the stop has a price history to sit against.
4 min read
Swing Trading
Everything on swing trading →-
Ledger
Holding Swing Trades on Margin: The Interest Is Small, the Gap Is NotOn a margin swing trade the interest is a rounding error; size the position for the overnight gap, because no stop will.
4 min read
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Versus
When the Market Goes Sideways, Swing the Range or Stand AsideIn a sideways market, trade the range with range rules if you take profits fast; otherwise cut size or wait.
4 min read
Options
Everything on options →-
Versus
A Deep In-the-Money Call Can Do a Margin Loan's Job, at a PriceFor a defined holding period a deep in-the-money call caps the loss and may cost less than a margin loan; for open-ended holding, shares win.
4 min read
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Ledger
Selling Puts on Margin: The Requirement Moves Against YouSize short puts by the cash it takes to buy the shares, never by the margin requirement, which is lowest exactly when it matters least.
4 min read
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Rulebook
A Defined-Risk Spread Still Needs a Position SizeA defined-risk spread is sized by its maximum loss against a fixed share of the account, never by the income you want from it.
4 min read
Prop Trading
Everything on prop trading →-
Myth check
Pass the Prop Firm Evaluation at the Size You'd Trade Once FundedPass the evaluation at the size you intend to trade once funded; sizing up to pass fast buys speed with the account's survival.
4 min read
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Argument
A Prop Firm Account Is Leverage Too, Just RentedTreat a prop firm account as leverage on the drawdown buffer, paid for by the fee, and size every trade from the buffer, never the balance.
4 min read
Dividends
Everything on dividends →-
Myth check
Treating Dividend Stocks as Bond Substitutes Breaks in a Bad YearDividend stocks are for income that grows over time; money for fixed needs belongs in bonds or cash, because a dividend can be cut in the year you need it.
4 min read
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Ledger
Buying Dividend Stocks on Margin Turns Yield Into a Spread TradeBorrowing to buy dividend stocks only adds income when the yield beats your loan rate; below that, it cuts income and adds a margin call.
4 min read
Earnings
Everything on earnings →-
Argument
Operating Margin Is the Earnings Line Worth Reading FirstRead operating margin before EPS, because the per-share figure can rise on buybacks while the business keeps less of every dollar it sells.
4 min read
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Myth check
Stock-Based Pay Is a Real Cost, Whatever the Adjusted Figure SaysStock-based pay is a real expense; use GAAP earnings, or subtract the stock compensation from the adjusted figure yourself before you compare.
4 min read
Economics
Everything on economics →-
Argument
Margin Debt Data: What the Crowd's Borrowing Can and Can't Tell YouMargin debt data is useful context on how much leverage sits in the market and a poor timing tool; the leverage number worth acting on is your own.
4 min read
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Argument
The T-Bill Yield Is the Hurdle Every Trading Strategy Must ClearJudge a trading strategy by what it earns above the T-bill yield, set against its drawdown and your hours, because the bill pays with no risk at all.
4 min read
Investing
Everything on investing →-
Argument
An Emergency Fund Is the Margin of Safety Under a PortfolioKeep several months of expenses in cash-like savings before investing, because the fund is what stops a lost job from forcing a sale at the low.
4 min read
How to read a column
Start with the call, the single sentence under the headline, and the figures printed beneath it. Together they tell you whether the argument applies to the way you trade before you read a word of the case for it.
Then rerun the worked example on your own account. Swap in your balance, your broker's margin rate and your own stop, and let the margin call calculator or the position size calculator do the sums. The terms a column leans on are defined, with the formula, under concepts, and narrower questions are taken one at a time under answers.