June 17, 2012

Investing Outlook:
Note: As a reminder. the share purchases of the Dividend Investing 'Sister' will be extremely small. It is my intent to demonstrate how to grow the size of these positions from 2 shares, to 300 shares using the three sisters portfolio management style. The Dividend Investing 'Sister' Account will also implement the Permanent Portfolio Method beginning in 2012 with $1,120.00 of the cash dedicated towards it.

Aileron Market Balance

Issue 33
Visit Us: NoNonsenseTrading.com Email: aileronmarketbalance@gmail.com

No further dividend purchases are planned in the upcoming week. The DRIP is off on all stocks. Dividends received will be in the form of straight cash. As mentioned last week, I will take half of all dividends, and send them to the Savings Side-Pocket account, and that cash will be applied to the Slush fund / Drawdown Kill Switch fund . The permanent portfolio section of this account has been built, and now will be managed on a longer term basis. I currently have a 3 point spread over normal permanent portfolio, and a gain of 1%.

Trading Outlook:

Each

newsletter on Sunday that will contain my thoughts for the week ahead will have an audio file that accompanies it. The audio file that is associated with this PDF will contain my detailed thoughts moving forward into the next week. This PDF file is meant to serve as a rough, general outline to the audio file that many subscribers are finding more advantageous. So the news that everyone wasted two trading days last week anticipating has come and gone. It is now 'the past', and the market is quickly discounting that news. As occurred on June 11, 2012, the market gapped open higher on anticipation of the results of this election, congested for a time, and have begun to fall lower. The problems in Europe remain, and they are getting worse. Spain is once again grabbing headlines, as the Spanish 10 Year Bond Yields are now north of 7%, and the safety bond flight continues in Europe to the German and UK Bonds.

Note: By way of reminder, since the Model Portfolio has only $10,032.48 in the Commodity Futures and Stock Trading portion of the portfolio, there will only be 'brief day trades' at this stage of the game for Commodity Futures trading in order to escape the risk of over-leveraged gap opens in the commodity futures markets. This is an attempt to demonstrate how account size relates to trading style. As I mention in my methodology series1, as the commodity 'trading sister' approaches $30,000 I will graduate the account into 'swing-trading' and demonstrate how I would go about doing this. Stock trades may last more than one day. The Forex account has $65.42 and is considered a micro-forex account for the purposes of the model portfolio.

Possible Stock and ETF Trading Thoughts

Proshares Short S&P 500 ETF (SH): Since the Fundamental situation in Europe has not changed, I have maintained my SH position. The market is falling, as concerns of Europe once again switch to 'what is'. What is, is that nothing has changed in Europe, with the exception that the immediate pressing disaster of Greece leaving the Euro
1 Exact Link http://nononsensetrading.com/methodology.html

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immediately is no longer present. That's being considered 'good news', and tells you where we are at.. Bond yields continue to rise in troubled countries. Austerity measures have not gone away. European downside risk remains. My SH position, thus remains.

Summary of the A.M.B. Model Portfolio

Note: In the beginning of this hypothetical portfolio, the share purchases of the Dividend Investing 'Sister' will be extremely small. It is my intent to demonstrate how to grow the size of these positions from 2 shares, to 300 shares using the three sisters portfolio management style. It is also understood that readers of this newsletter have a firm understanding of my 'three sisters' portfolio management system (See the Special Reference issue of Aileron Market Balance 3 for an explanation of this system).

Commodity Trading Thoughts

My commodity future thoughts this week are nearly identical to what they were last week. July Sugar (SBN12 or /SBN2): This is a buy, as we are at current support on both the one hour chart, and the 10 minute chart, on the ema's that I use in my methodology (mentioned in the methodology series2 of videos). The support at 19.80 must hold. If that support holds, then there is a long trade here as the market begins to climb higher. July and September Crude Oil (CLN12 or /CLN2 and CLU12 or /CLU2): This is not a market I'm looking to trade. This is a market I'm looking to monitor as a barometer of the worldwide auction and worldwide recession.

S&P 500 Year to Date: + 6.671 % AMB Total Portfolio Return Year to Date: + 2.445 % Investing Account Balance: $4,053.48 Return / Yield up 0.05277 % Year to date 4.063508 shares of PEP (DRIP off Yield is 3.09 % )
4 shares at $63.31 on 11/15/2011 w/ $5.01 Commissions 0.032263 shares DRIP at $66.95 on 1/3/2012 0.032145 shares DRIP at $66.25 on 3/30/2012 Next Dividend: 6/29/2012 Pay Date

4.0676 shares of PG (DRIP off Yield is 3.58 % )

4 shares at $61.94 on 11/28/2011 w/ $5.01 Commissions 0.32392 shares DRIP at $64.83 on 2/15/2012 0.35208 shares DRIP at $64.19 on 5/15/2012 Next Dividend: Not yet announced

Micro-Forex Trading Thoughts

Stay tuned to the Forums. I am presently trying to discover a longer term 'dollar long' entrance. I will try to keep you all updated on this thought.

4.035 shares of JNJ (DRIP off Yield is 3.70 % )

4 shares at $62.31 on 11/28/2011 w/ $5.01 Commissions 0.035 shares at $65.14 on 3/13/2012 $2.46 in Cash on 6/12/2012 Sent $1.23 to Sav. Side-Pocket Next Dividend: Not yet announced

8.081305 shares of WM (DRIP off Yield is 4.37 % )

8 shares at $32.39 on 12/22/2011 w/ $5.01 Commissions 0.081305 shares DRIP at $34.93 on 3/23/2012 Next Dividend: 6/22/2012

Permanent Portfolio $1,120.00 of cash I reserved for Permanent Portfolio Purchases Return from $1082.72 = + 1.00 %
- $2 shares @ 156.12 of GLD ( $312.24 ) ( Currently $315.68 ) ( 28.93 % of P.P ) - 2 shares @ 139.58 of SPY ( $279.16 ) 2 Exact Link http://nononsensetrading.com/methodology.html 3 Exact Link http://www.scribd.com/doc/73238645/Aileron-MarketBalance-Special-Reference-Issue-Portfolio-Management

June 17, 2012

( Currently $268.28 ) ( 24.58 % of P.P ) - 2 shares @ 118.17 of TLT ( $236.34) ( Currently $252.80 ) ( 23.17 % of P.P ) - 3 shares @ 84.45 of SHY ( $253.35) (Currently $253.26 ) ( 23.21 % of P.P ) Upon the next re-balance SHY will instead work as pure cash

Total Trading Balance: $10,097.90 ( Return / Yield up + 3.883 % Year to Date ) Commodity Futures and Stock Balance: $ 10,032.48 Return / Yield up + 3.889 % Year to Date Next Re-Distribution Goal: $10,700.00 Original 3% risk tolerance gives us approximately $282.54 for my drawdown tolerance ALREADY USED $ 271.57 available from Slush Fund I had a few trades last week, and still have the SH position on, marked to market, resulting in a net positive week ...

Remaining Cash: $1,896.98 ( 46.8 % )

- $1.23 of JNJ Dividend remains in account, $.123 transferred to the Savings Side-Pocket - $0.08 of SHY Dividend on 6/7/2012 - $0.53 of TLT Dividend on 6/7/2012
Percentages of that Cash -$1,576.98 of this Maneuvering Capital I reserve for Hedging and New Purchases ( 83.13 % ) -$80.00 of this Maneuvering Capital I reserve to Dollar Cost Average PEP further in the future ( 4.217 % ) DCA Price on PEP - $60.00 -$80.00 of this cash I reserve to Dollar Cost Average PG further in the future ( 4.217 % ) DCA Price on PG- $58.00 -$80.00 of this cash I reserve to Dollar Cost Average JNJ further in the future ( 4.217 % ) DCA Price on JNJ - $59.00 -$80.00 of this cash I reserve to Dollar Cost Average WM further in the future ( 4.217 % ) DCA Price on WM - $28.00

Short 600 KOG from 7.88 to 7.82 on 6/11/2012

PROFIT - $15.91 (including commissions of $20.09)

Long 120 STX at 22.93 on 6/11/2012 to 23.46 on

6/13/2012 PROFIT - $43.54 (incl. commissions of $20.06)

Long 1 SBN2 from 19.95 to 19.96 PROFIT on

6/13/2012 - $4.20 (including commissions of $7.00)

$271.57 ( 6.7 % of this account ) available from Slush Fund Dividend Investing Sister Year to Date

Courtesy Credit on 6/14/2012 of $0.01

Currently Long 38 SH at 33.46 on 6/11/2012 Futures 'Sister' Account Year to Date

June 17, 2012

My current money management stats after the trade last week ...
Exit 70 @ 1.2583(6) LOSS of 13.1 Pips $0.0917

Short 70 EUR/USD @ 1.2578(7) on 6/14/2012

Exit 70 @ 1.2578(7) PROFIT of 0.4 Pips $0.0028 Even those trades I lost on, were trades that were beginning to go in my favor, and the market completely reversed course and the trailing stop was able to minimize my loss. As a reminder, I have adjusted the sizes in regards to our order management. Now, each time I enter the market, I have a 13 Pip Firm Stop Loss, a 19 Pip Trailing Stop Loss, and a 31 Pip Profit Target ...

Forex 'Sister' Account Year to Date

Micro-Forex Balance: $65.42 Return / Yield -4.118 % Year to Date Phase 2 Return: 0.18 % Phase 3 Return: -0.304 % $ 271.57 available from Slush Fund

And with the reboot process now underway, here are the money management statistics for the last 9 trades. The most encouraging part of this is the improvement in the risk reward ratio. With more trades, we can compare that to our accuracy rate ...

I had a few Micro-Forex trades last week which began to turn my money management stats around. Naturally, we will need more trades to get a better picture of the state of our Micro-Forex trading

Short 70 EUR/USD @ 1.2559(6) on 6/11/2012 Exit

70 @ 1.2529(7) PROFIT of 29.9 Pips - $0.2093

Short 70 EUR/USD @ 1.2598(8) on 6/12/2012

Exit 70 @ 1.2602(80) LOSS of 4 Pips - $0.0280

Short 70 EUR/USD @ 1.2570(5) on 6/14/2012 4

June 17, 2012

Savings Side-Pocket Account Balance: $1,799.80 Capital is -11.27 % Year to Date. Yield Return on Capital + 0.5587% $271.57 for a Slush fund / Drawdown Kill Switch fund ($233.57 owed to this Fund)
- $1.23 added from JNJ Dividend

$1,010.29 for a Base Savings

Percentages of that Cash: $814.29 of this cash reserved for Long Term Variable Capital PP - ( 80.60 % ) $120.00 of this cash reserved for CD Ladder creation ( 11.88 % ) - One $10.00 One Year CD purchased on 11/21/2011 at 0.60% - One $10.00 One Year CD Purchase on 12/21/2011 at 0.50% - One $10.00 One Year CD Purchase on 1/21/2012 at 0.50% - One $10.00 One Year CD Purchase on 2/21/2012 at 0.50% - One $10.00 One Year CD Purchase on 3/21/2012 at 0.50% - One $10.00 One Year CD Purchase on 4/21/2012 at 0.50% - One $10.00 One Year CD Purchase on 5/21/2012 at 0.50% $20.00 of this cash reserved for the first side-pocket purchase ( 1.98 % ) $20.00 of this cash I reserve for the second sidepocket purchase ( 1.98 % ) $36.00 of this cash I reserve for the hedging account ( 3.563 % )

$505.14 for Emergency Savings Getting Paid Fund: $12.80 Remember, next week, on June 21st, is considered when AMB purchases another $10.00 One Year CD for the Ladder. Total Portfolio Balance: $15,951.18 - Total AMB Inception to Date Return: + 6.341 % Return / Yield up + 2.445 % year to date) S&P 500 Year to Date: +6.671 %

If you have any questions regarding my personal outlook, or any other comments, please feel free to contact me

June 17, 2012

at dan.shy@gmail.com or aileronmarketbalance@gmail.com. I will say that if you have questions about your own trading and you want to ask for my input? Please include your most recent money management performance statistics in any email correspondence.
Until next time, stay safe trade well, and remember that loving other people doesn't cost a dime.
Note: I, the author do not grant this work for wide distribution beyond any single individual subscriber as this publication is protected by U.S. And International Copyright laws. All rights reserved. No license is granted to the user except for the user's personal use. No part of this publication or its contents may be copied, downloaded, stored in a retrieval system, further transmitted or otherwise reproduced, stored, disseminated, transferred, or used, in any form or by any means except as permitted under the original subscription agreement or with prior written permission. The above statements should not be construed as an investment or trading recommendation. Aileron Market Balance is a newsletter that allows subscribers to look 'over my shoulder' as it were, for my own personal specific trading and investing ideas and thoughts for the next week. But they are only thoughts as of the moment of publication, and are subject to change. There is no guarantee that I will enter, or have entered any of the trading or investing ideas that I discuss in this newsletter; as larger accounts may require a different strategy as the ones presented here. Any trades or investments that I discuss within this newsletter are simply my own thoughts regarding my own investing and trading outlook. I discuss which trades I take and do not take on the No Nonsense Trading Forums, as well as the Ventrilo Voice Server. Remember that entering any market is an individual decision. This newsletter simply contains my trading and investing thoughts for the next week. I personally only enter any market after watching and reading the tape and I trade using money management principles4. The losses in trading can be very real, and depending on the investment vehicle and market, can exceed your initial investment. I am not a licensed trading or investment adviser, or financial planner. But I do have 16 years of experience in trading and investing in these markets. The Model Portfolio accounts are hypothetical accounts,with all of the inherent problems therein, which are used within this newsletter in an attempt to track the results of this newsletter, and is run for the education of other traders who should make their own decisions based off their own research, due diligence, and tolerance for risk. Any pictures used within this newsletter are believed to be public domain. Any charts that are displayed using the ThinkorSwim platform, and other pictures were obtained through Wikipedia's public domain policy.

Exact Link - http://nononsensetrading.com/MoneyManagement.html