Hmm- you ask all the questions which I wish I had an answer for myself. Here's my 2 cents worth:
""Is there a rule of thumb for the size of parcel I should buy? I currently have 10 stocks, mostly about $3.5K each. Would I be more profitable with 4 stocks of $10K each? Is 10 stocks too many to effectively manage anyway? ""
imo this depends on, among other things, your risk profile/tolerance. Stating the obvious, if you have only 4 stocks and they all go up substantially, you benefit. If they all go down, you lose, and if you have an average success rate, then you should do ok. However, by holding 10 stocks you are spreading your risk more evenly and should achieve an average overall gain. One strategy to consider regardless of how many shares that you hold, would be to ensure that you are not overweight any one particular sector. Is holding 10 shares too many? That would depend very much on each individual's trading style and ability. If you trade on a momentum and technical analysis basis, it may be sufficient to set up conditional orders for profit triggers based on predetermined targets, and then also set up appropriate stop losses, and then you do not even look at the trading screens or depth for those shares at all. (I know that this is a strategy recommended by many traders who also use suitable hedging strategies, such as cap and collars and so on). If you day trade and close out positions during the day you may find that holding 10 shares at a time becomes difficult to manage. Personally, I day trade a share when the upside potential looks very good, and normally close out about 70 to 80% of my day trading positions before the end of the day, depending on the momentum. This means that I could be trading 5, and every so often, 10 shares. I have found that minimising my active trades works for me. Even though I may make several trades during the day, more often than not, I would have brought and sold a number of shares during the day.(I also hold numerous shares in a long term portfolio but tend to less actively manage these holdings and treat them as separate from my day trading activities). What I found really works for me is to set myself a profit targets for daily, weekly and monthly periods, and when I reach my daily target, I can relax and not force trades. In the beginning, set yourself a target, and if you find that over a period of time you are not reaching it, lower your target. The worst thing you can do is be under pressure to reach your daily target and end up forcing trades which have little prospects of success as a result. Saying that, you also need to consciously make an effort to trade- you won't make any money sitting there staring at the screen. This is of course assuming that there are some trading opportunities on the day- sometimes it’s just slow and not many suitable trading opportunities present themselves. "Should I be holding any overnight....??.""- Boils down to the individual trade's prospects and your risk profile. In an up trending market the risks are less. What I tend to do is assess the market risk as well as look at the individual stock chart to assess how bullish it looks before deciding to hold. If you reach your profit target on that share, then go ahead and sell. The conundrum you may face is using your FMG example, that the share could run further and you could have would have should have held on longer. My view is that before you enter the trade you should already have an exit strategy in mind, and generally stock to that strategy. If you are asking yourself before the close of day whether you should hold on to the stock overnight, it is a clear indication that you have not at least thought through a strategy before buying the share. It could have been "I will sell when profit hits 10%". Alternatively, you could have made the buy decision based on technical analysis and determined that ""the chart looks bullish because the Slow stoch has crossed and the SP is above the 50 day MA line, I will buy now and when the Chart starts to provide bearish signals, I will exit"". In that case you would hold the share for a couple of hours, one day, or even a week or three until your sell criteria are triggered. Whatever your strategy, it is important to at least have a strategy. Personally, I use various strategies, but mainly I look at the momentum of a share and when various signals indicate a change in momentum, I will exit. I also tend to take profits on the way up, thereby locking in some of my profits and lessening the risk on my remaining holding, while still maintaining some of the upside. What I do here is to sell say 50% of my holding when profits hit a large %, and then immediately make 2% below that price point my stop loss level for the remainder of my holding. In this way, if the price continues running up I benefit, but if it retraces I have retained most of my profits.
At the end of the day each person needs to determine their own trading strategies and style based upon thier own individual personalities and preferences. Experience over time will be the best teacher and do the most to form your own style
