Trade Alert
When we make a trade at Wanderer Financial we immediately begin the process of alerting subscribers. Within one minute you will receive an alert via WhatsApp, and within two to four minutes will begin receiving an e-mail, a website blog post, and we also post in Basecamp.
So let’s break down what it means, and what you can do with it.
Here's an example of a trade alert issued via WhatsApp. In this screenshot you can see a trade alert for BAC stock, followed later by a Trade Update on some of our other current trades. When a Trade Alert is sent out to WhatsApp we do so as quickly as possible, so there is usually no information beyond the trade numbers. In the blog post that follows that there will be more information, including a chart. A Trade Update is less time sensitive, so that will usually go out with more information already included.
And here is what a Trade Alert will look like on the blog post:
Purchase Price
Bought 15% BAC @ $22.81
This is pretty straightforward. We bought a 15% size of ticker symbol BAC for a price of $22.81.
The 15% size is the recommended percentage of a portfolio to allocate to the trade. So a $10,000 trading account would buy $1,500 worth of BAC. At a price of $22.81 this would be 66 shares. We've created a trade calculator to make it easy for you to determine trade size, and see the reward-to-risk ratio.
Stop Price
Stop @ $21.98
What this means is that this is the price we would set our Sell Stop order at. This is for risk management purposes. If the trade goes the wrong way, we would sell it for a loss at $21.98. This is where we would determine that our reasoning for the trade was wrong, and there is no longer a point in keeping it. In this particular case that would mean a loss of 3.6% on the trade, or a (15% x 3.6%) .54% loss on the total portfolio.
Target Price
Target @ $27.90
This is the recommended level to sell at for a profit. Based on a number of factors this is the level that we anticipate the stock climbing to. Unless otherwise noted in a subsequent Trade Update, this is the price Wanderer will sell their position. No Trade Alert will be issued when this level is hit, as it is to be assumed based on the target price being reached. In this case that would mean a profit of 22.3% on the trade, or a (15% x 22.3%) 3.3% gain for the portfolio.