Double my money challenge by a beginner

[1nvest]

good luck!
I did a very simple backtest for the last 22 years whereby when the market is in an uptrend (simply by using a positive momentum) and choosing the top 10 stocks ranked by the same momentum score from the FTSE100 you can significantly outperform the market which is denoted by the black line. the backtest goes to cash in negative market conditions and holds the stock until its momentum turns negative
unfortunately i couldnt bring in positive sector also...Just an indication of what positive absolute and relative momentum can do

 

[HappyRunner]

good luck!
I did a very simple backtest for the last 22 years whereby when the market is in an uptrend (simply by using a positive momentum) and choosing the top 10 stocks ranked by the same momentum score from the FTSE100 you can significantly outperform the market which is denoted by the black line. the backtest goes to cash in negative market conditions and holds the stock until its momentum turns negative
unfortunately i couldnt bring in positive sector also...Just an indication of what positive absolute and relative momentum can do
View attachment 331231

Wow! I'm off to look into positive momentum more before the markets open. 🙏

 

[HappyRunner]

😱 Rookie mistake!!!! I've been using the eToro performance charts thinking they were just line graphs of the candlestick charts. Today, I think they're not the same. Which is where I've been getting my weird stock picks from. Dang! That helps explain things...Right, I'm pretty much scraping back to the start today with new stock that has a positive momentum as per the candlestick charts on tradingView.

 

[HappyRunner]

Day 6
The day's trading isn't finished so I can't/won't do a write up until tomorrow but it's not been great. Started the day with my Halfords (HFD.L) stock triggering a stop loss. Great! I then sold 8 more stocks and bought 9 stocks all with forward momentum and disregarding their E/P ratio and only one of my new stocks has risen at all. The rest have fallen by up to a few percent.

So now I'm left wondering. Do I just sell them all now to avoid a bigger loss, or calm down and take a chance that they'll improve on Monday?

For example: AVGO

And NRG:

I feel the mature option is to wait, give it the weekend and try not to panic. My monkey brain wants to sell right now. No, nope. I'm not going to touch them until Monday afternoon after work. Anyway, it's a general bummer. I've wiped out 3 days of gains in 2 days of losses.

 

[1nvest]

So now I'm left wondering. Do I just sell them all now to avoid a bigger loss, or calm down and take a chance that they'll improve on Monday?

Calm down, its just a bad day. stick to your strategy, it just needs refining

I'm curious as to how you managed to find 9 stocks to buy today!! I went through the FTSE100 and came up with 1. My criteria is going to be different from yours. if you share your list i'll give you my thoughts and what i would be looking for

FTSE on a weekly basis is not in an uptrend. so im not surprised i only came up with 12 as an initial shortlist, and just 1 finally out of 100, so im interested in your 9. That said, the market can easily bounce. I would however not replace your stocks. certainly not the FTSE
The two you mentioned are from the US so i wont beat you up

I think you need to define your timeframe, your definition of a trend, how strong is that trend your entry point once the trend is established, and then what your exit strategy is (20% take profit and 8% im afraid is a little too generic).
if you are buying 9 today, 8 yesterday i kind of think you may be jumping the gun, you're certainly in a hurry.
Be picky, give yourself every reason not to part with your money
but of course, lets not forget you've only just started so I wouldnt get too carried away. This is a marathon, as they say...
personally, i'd spend a little time getting used to defining what does good look like

Avgo wouldnt have met my criteria, not yet anyway exactly the same reason as Peak a couple of days ago. you have clear resistance, let it break that resistance.
otherwise a really good pick, just a little too hasty. hang on though and lets see if it climbs
NRG, horrible looking chart. you can honestly do so much better, that said, its only retraced a fraction today, so again i'd give it a chance
take a deep breath. stop wanting to buy everything

 

[HappyRunner]

Thanks, @1nvest. Yes, I need to calm down. I got too good a result over the first few days and it's affected my expectations...
I'm chopping and changing too much- it's swing trading not day trading.... What options do I have beyond a 20%/7% TA/SL?

This was Friday...

Stayed with: LLY (+0.01)

Stocks sold: FSLY (+0.04), NOC (+0.2), LDOS(+0.1), MCD(-0.08), F(-0.07), ALLE(-0.14), RWE.DE(+0.34), RTN.L(-0.03), HFD.L(-0.89)

Stocks bought: AVB (-0.07), CI (+0.11), AVGO (-0.32), MCK (+0.00), NRG (-0.14), VMW (+0.09), KLAC(-0.32), HUM (+0.16), BP.L(-0.05)

Why I bought these stocks: Using the stock screener on TraderView, these had S &P 500 'strong buy' technical indicators and this seemed like a good place to start. I also consulted the 5 day charts. Only this didn't bring instant success, which made me worry and get about ready to dump these and run. I was over $1 down which felt like a lot. Although I was only a max of about 2% down per stock so nowhere near my SL.

Next steps: To see how Monday starts/continues. Not jumping in and rejigging my portfolio yet again. To spend my Sunday really sitting down with a pen and paper to come up with stock picks to monitor.

Total invested: $127.27 + (-1.04) loss = £104.04 portfolio value

 

[1nvest]

Hi Happy, Sunday sounds like fun. A few quotes from an incredibly wise man...

had you chosen those stocks that were close to or hitting new 52 week highs, you will likely hit your target much quicker.

trading view also has a screener for those 52 week highs. AVGO is on it
it should be a starting point but if it was all that you did i'd argue it would be better than the strong buys list

how strong is the market right now? which should dictate your level of risk
For the S&P500 only 23 stocks are hitting new highs. 51 are hitting new 52 week lows. just 23 out of 500, and twice as many lows than highs. The market is very weak. another wise man said...

if the broad market is doing poorly, when there is a bad day/week. everything suffers

you could limit those stocks from the 23 to only those that had closed above their last pivot, so being really choosy..
you could limit or reduce the number you choose, or even the risk taken for each
or of course sit it out

another metric, how many winners to losers have you had right now...is that an indication of your strategy or the market?
if the market was really hot right now, do you think it would matter whether you were looking at 52 week highs or simply throwing a dart at the list of 500..that was rhetorical. your entry criteria helps you limit those losses, but if you are doing what the market is doing, when its doing it. good things happen. doesnt matter if you used a moving average cross over, or you thought you were the second coming

I did a very simple backtest for the last 22 years whereby when the market is in an uptrend (simply by using a positive momentum) and choosing the top 10 stocks ranked by the same momentum score from the FTSE100 you can significantly outperform the market

Imagine your results if instead of looking for stocks when the market was really weak, you timed the market when the S&P was also hitting new 52 week highs. The back test was simple. when the S&P was positive, choose the most positive stock. let that stock go and do what its got to do.
when its not hitting new 52 week highs, but pulling back...you have just 4% of the market to choose from.

one last thing now from me...if i were you, i would be looking at weekly charts minimum, so your next list should be chosen after the close on friday and ready for monday. that will for one limit your losses in a weak market and also cut out all the noise from daily charts

enough from me now..just think on what i've said and honestly wish you the best.
I'll follow this thread with interest, if you have any questions, just message me

 

[HappyRunner]

Thanks, @1nvest I need to come back to your post tomorrow to properly digest as my brain is mush right now and I won't do it justice. I just went ahead, without taking on your wisdom for my latest picks, reverting back to my first methodology except that I have a much better grasp of resistance and support which definitely stopped me from continuing or starting trades today. I promise I'll read what you've written and look to implement it before I touch any trade tomorrow.

Day 7 - back in the green

Stayed with: CI (+0.37), HUM (+0.32), LLY (+0.15), VMW (+0.00), MCK (-0.20)

Stocks sold: AVB (-0.08), NRG (-0.10), KLAC (-0.24), AVGO (-0.10)

Stocks bought: JNPR (+0.04), DVN (+0.07), PCG (+0.05), KMI (+0.03), AEE (+0.03)

Why I bought these stocks: Focusing on tech, comms, utilities and basic materials as the top performing sectors. These were undervalued stocks trending upwards.

Why I sold these stocks: These were hitting resistance and the only way looked to be down. Given how unsound my selection of them had been in the first place, and the fact I started the day $1 in loss, I just wanted rid of them so I could make a profit.

Next steps: To really read @1nvest's advice before I go touching my portfolio again.

Total invested: $126.76 +(0.85) profit = £104.58 portfolio value

 

[AndreyMal]

Kudos on diving into the trading world and taking the initiative to document your journey! It's a wild ride, but it sounds like you're approaching it with a healthy mix of caution and curiosity, which is excellent.

 

[AndreyMal]

The 20% profit, 7% loss model you're following is a solid starting point. The percentages give you a framework, but remember, the market doesn't always follow the rules! There'll be a lot of curveballs, but that's part of the excitement and learning experience.
Since you're exploring UK and US shares, have you thought about dipping your toes into cryptocurrencies? They could offer another layer of diversification to your portfolio.