Basics

Felt it is important to explain how I am "Investing" and "Trading" in the market and at a high level thinking behind what I am doing and why I am doing it.  

Philosophy behind what I do can be explained in 7 key points: 

7 Key Recommendations: 

1. Please Please Please - Keep “Investing” and “Trading” accounts as separate. 
2. “Invest” your money - with a longer time horizon. 10 years, 20 years or even more. 
3. Start small (even as low as 5$), but do it repetitively, buy daily or weekly (Utilize, Auto Invest feature)
4. First 10,000$, invest it on “Index” Funds such as #SPY, #QQQ, #IWM, #FXI, #INDA etc. (https://viralpatel15.blogspot.com/2021/03/stock-market-beginner-advice.html) 
5. Do not try to “Time” the market, Do not think this is the Top (and sell) or Do not think this is the Bottom (and buy). 
6. “Invest” in you - products and services that you get from various companies such as Costco, Netflix, Apple, Nike, Starbucks, Chipotle etc. 
7. Only after you have spend 10,000 hours reading-learning about the market, you may try to “Trade” in the market. Learn some basic skills of charting the stock, about moving averages, relative strength indicator etc. Always trade with small amount during learning period. Find your niche - whether you are good in - Day Trading, Swing Trading, Long Term Trading, Options (buying or selling), and stick to it until you have perfected the method. 

My near term goal is to have 1 Million US Dollars invested in the stocks in the "Investing" account. Obviously, I do not have 1 million dollars, I started with 5$ and every day I buy lot many stocks through "Auto-Invest" feature in Robinhood Account. Initially I started with the following set up: 

My set up in one of the Robinhood Accounts for fraction stocks. I buy 5$ each day in my top 20 stocks, 3$ in 30 other stocks, 2$ in next 30 stocks, 1$ in left over 60 stocks (Total of 140 Stocks) and 10 ETF's (another 35$ daily) ...Total comes around $345 on daily basis...(252 Trading days) so 345*252 = $86,940 each year. 

However, I changed that this year and now, I buy 5$ each day in my top 20 stocks, 3$ in 30 other stocks, 2$ in next 40 stocks (most of them pays Dividend), 1$ in next 50 stocks and 10 ETF's where I buy 5$ each. On top of it, I do have another Robin hood account where I buy 150 risky stocks but I buy only 3$ and that too weekly so roughly 450$ each week in it. In that same portfolio, I also buy 2$ in Bitcoin and 2$ in Ethereum each day. 

Plus - I have another theory which goes something like - "Winners Keep on Winning" - Initially when I started that - I tracked Top 5 stocks in each category (Mega Cap, Large Cap, Mid Cap, Small Cap and Micro Cap) and buy 2$ each week in 5 stocks from Mega Cap, 4$ in Large Cap, 6$ in Mid Cap, 8$ in Small Cap and 10$ in Micro Cap. After doing it for a year or so, I realized there was a lot of pump and dump in Micro Cap and that 10$ was getting converted into 0$ by 3 or 6 months. So I changed that method, and now I am doing reverse, which is 10$ in Mega Cap, 8 in Large, 6 in Mid Cap, 4 in Small cap and 2$ in risky micro cap. So, at least I will be losing 2$ in that risky category - Well 10$ risk per week as it is 5 stocks that I invest in. One of the sample-example would be the following tweet: so based on that I would be buying 10$ in NVO, 8$ in DXCM etc...

Plus - Each Week - I pick weekly picklist, from that pick - for each pick, I buy 5$ in the long term investing portfolio. I try to look at the 300+ charts each week in the weekend to find out which stocks are bottoming out or breaking out and pick the 20 stocks. From that there are 5 stocks which I think are good picks for long terms. One of the criteria for that long term pick is that company should give 10X return over 10 years or it should give at least more than 3 to 5% Dividend. One of the sample-example is below Tweet: 

Also, I have a small size M1 Finance Portfolio - where I pick the above 20 picks where I would buy these stocks on Monday Morning and Sell them on Friday evening. I have been doing this for now more than 2 years and ratio of beating market (SPY) is not that impressive, but hey early days, but my motive is not just to beat index on weekly basis, it is also the fact that this exercise helps me prepare for the upcoming week - sort of list of stocks that I might be looking to buy and sell during trading hours in "TRADING PORTFOLIO". 

Now, the important - "Trading Portfolio" - This is (not so small) portfolio, but I have some hard core rules in them. There is no long term in the trading portfolio. Its strictly on the basis of - if the stock is in uptrend, giving me money, it will be in it. If it sells of 8% from my buying price, I get rid of it. I also buy some options in the trading portfolio. Trading Portfolio at this point is for "Fun". Investing portfolio is the real deal. When I do lot of tweets - that I am buying this or selling this - it is usually for short term in the trading portfolio - based on charts and indicators and option flows and what not. 

Usually, most folks what they do - is make money in trading portfolio and whatever they gain they put it in the investing portfolio. Because most of them does not have big capital to invest. However, Robinhood has changed that. We dont need to have lot of dollars to invest. Even 1$ is good enough. As and when we keep getting dollars saved, we can keep on adding it in the investing portfolio and after time - it will grow. You do not have to "copy" me- Please do not copy me or my methods - but create your own, based on your risk appetite and your desire to grow. 

There might still be lot of questions on the method - but thought I should explain in short on how I am planning to construct my investing portfolio and keep trading activities separate in trading account.