Spread Trading

http://www.financialsense.com/editorials/kleinman/2006/1226.html

The above article is a good introduction to spreads. While this is not something that I have any competence or confidence in using (heck I'm still working on shorting successfully), this is something that is worthwhile understanding. Why? Because it forces you to think about how the market might move and what trading/investing vehicles are available for you to capitalize on those moves. And if you are thinking about how the market it going to move (either with you or against you), then you will do a better job of gauging risk--and that is always a good thing when it comes to protecting your precious capital.

I visit FSO often. They have alot of articles from different contributors. I understand most of them! There does seem to be a preponderance of precious metal bias. Sometimes it sounds like Henny Penny, and that is an investment mantra of some. Any bias that you hold really requires you to wrestle it to the ground and thump it hard a few times. That's easier said than done. I have a few biases that I have to exorcise still. As I'm not a full time trader, these impede me but they are not lethal. For a full time trader, I would imagine that being hard headed about anything will have you out on the street pretty quickly.

Perhaps a good New Year's resolution would be for you to look at some of the biases that you might hold and see how they might be remediated to improve your investment performance. I'll ruminate on this for myself and post a few of mine.