About The Monkey

My name is Dan Schwartz and I'm the writer and trader behind ProfitMonkey. Ever since high school (that was a long time ago... believe me), I have had a keen interest in the financial markets. I'm a news junkie and have always wanted to use my knowledge and analytical skills to be able to earn an income from trading stocks. Today, that is exactly what I do and I want to share some thoughts that I have on this blog. I hope that you will find my musings on the financial markets useful and enlightening.

A Little History...

At my trading desk

I've been trading since 1998. When I first started trading stocks, I got the impression that it was an easy way to make some money fast. I read a few books to learn about day trading as that type of trading held the most allure for me. I read many books including "Day Trade Online" and "The Electronic Day Trader." These were excellent books. They taught me tons, but their weakness was they made day trading seem easy; and it was... in theory. In fact, any sort of trading, when looked at with the benefit of hindsight and in a theoretical framework, is easy. I traded for a while with real money (big mistake) and managed to lose everything after a few months. And here I discovered the #1 problem with trading - It looks deceptively easy and very appealing, but trading is far more complicated. The reality is that it is much easier to lose money than to make it.

I have been studying and using technical analysis since the beginning. It is a natural place to start as a trader, but you can easily get bogged down and overcomplicate things with thousands of indicators, chart patterns, and confusing strategies often developed by others. At first I looked only at charts to find and place my trades, but over the years I have discovered that technical analysis in itself is somewhat incomplete, so I began to study fundamental analysis. Many traders don't use fundamental analysis because:

1. It's more complicated and requires research into balance sheets, SEC forms and developing an understanding of what lies behind the headline numbers; and
2. It can take time to achieve results. Price targets and profits are a long process when based on fundamental data. 

These days I trade with a combination of technical and fundamental analysis and this has brought my trading to a sort of harmony with the markets. I give fundamental analysis more weight when I am looking for an investment and technical analysis when I'm looking for a trade. I don't panic in and out of positions and I focus on making calculated decisions with every trade I make.

Market Theory or Market Reality

"Buy low - sell high." It's easier said than done. There are so many factors at play in the stock market that create numerous pitfalls for a trader or investor. These are often impossible to predict, although some stock moves can be inferred using data analysis techniques such as watching for unusual options activity, but remember, nothing should be taken at face value. I have learned this over the years while making both trading profits and trading mistakes.

I have discovered that there are far more pitfalls when you trade with a shorter time horizon. The fact is, more short-term traders wind up losing money. In other words, day trading holds bigger risks than longer term trading or investing. So these days, I stick to swing trading and investing. I have found my niche (a form of Zen if you will) and it works well for me.

My Investing Philosophy and the Importance of Money Management

Dan Schwartz - Investor and Blogger

I have tried many black box systems, following someone else's trading system, following a chat room, but they all have one thing in common. These systems are not my own. This is why my investment philosophy now is about developing a trading system that works for me. I build my portfolio based on my comfort level and trade strategies based on my experience and knowledge. This is the philosophy that I want to share with you through this bog. There is no better person who has your best interest in mind than you!

Finally, if there is anything that matters most to being a successful trader or investor, it's money management. Understanding this is critical if you're going to succeed. Trading the financial markets is not poker, you don't go 'all in' or double down when things go wrong. Keep a level head and trade skilfully and without emotion. Manage your trading capital and you will benefit.

You also have to understand that losses happen. You might have heard this before - "I know the stock is down, but I'm hoping it comes back." That is a very bad strategy for financial success. Don't let losses wipe out your trading capital. If you are holding a losing position, know your stop and get out before you get wiped out. Hope is NOT a trading strategy. As a trader friend of mine says, "live to trade another day."

Sharing Knowledge

I love the idea of being able to share and teach investors what I have learned over the years. Trading can be a very lonely business and I want to help others find their trading niche. I believe that the process of creating profits from the financial system is a very individual journey. You have to learn what you can and apply it to your own skill set and comfort zone. Simply following some guru will only take you so far.

In order to teach technical and fundamental analysis in a straight forward manner, I'm starting an online business called PM Trading Education (under development) focused entirely on financial market education. Through my website www.profitmonkey.com (also under development), I will provide a complete online training course on the financial markets designed to be clear and simple. This course will take traders and investors from the very basics to the most advanced strategies I know. Taking the course will give you a strong financial basis from which to capture profits from the financial markets. This educational course includes a complete education on stocks, options, ETFs and futures. With this knowledge, I know you will find your trading niche and be on your way to great success.

I can't guarantee that every person taking this course will become profitable every time, but I know that it will definitely improve your odds.

Connect With Me

If you are interested in following my progress and giving yourself a financial edge, then you can always find me here on this blog, or on Google+, Facebook, Twitter, LinkedIn, or send me an Email. If you ever have a question, these links are a great way to ask and I will respond right away.

Updated May 11, 2013