Weekly Update for week 9/50 ended 3/12/2011 Nice week, up 27K (9%). Week of steady gains (14 of 20). The two stand-out trades were FNSR on Wed, and GMCR on Thurs. Got in with PUTS on FNSR following a dead cat bounce on Wed sometime after it opened, and closed that with a gain of 14K. Unfortunatley dabbled on the short side on GMCR on Thurs. That cost 13K. The GMCR trade should fall under the fade trades to be avoided, but seems my program needs some tweaking to recognise that. Code: Opening Balance: 282,269 Net gain for the week 26,936 ------------------------------------------------ Net Balance: 309,205 Number of Trades 20 Number of Profitable Trades 14 Since Inception of Thread 01/8/2011 - 3/12/2011 Opening Balance: 335,899 Net loss(Less Margin Interest) 26,694 (Down 8%) ------------------------------------------------ Net Balance 309,205 Number of Trades 144 Number of Profitable Trades 81 TOP/BOTTOM DISCRETIONARY TRADES TICKER ENTRY DATE/TIME EXIT DATE/TIME QTY PURCHASE AMT SOLD AMT GAIN/LOSS TYPE FNSRMAR19201128.0PUT 2011-03-09-09-53-29 2011-03-09-15-09-19 15000 35250 49500 14040 FNSR PUT ----------------------------------------------------------------- GMCR 2011-03-10-11-54-03 2011-03-10-12-53-59 4000 246817 233960 -12897 SHORT
I wish I have it laid out with a defined rule. But I don't. Normally I have a holding time-frame (intraday for the most part). If I hold for an hour or two and there is no sign of life, I would probably begin to look for an exit. Maybe a litlte bounce in my favour I could be out, but any case not exceeding the end of day. But if there is material information/news I was not aware of on entry I would probably exit immediately I discover.
Neke, did I read that right? You went long 15,000 FNSR puts. Did you have any liquidity concerns? I'd be interested to see you break that trade down a bit if you would be willing to do so. You have the capital to short ample stock, what advantage did you see using an option over an outright short? TIA
No, that was 150 contracts (representing 15,000 shares). I wouldn't short 15000 shares of FNSR when it was already down more than 35% - the risk would be way too much. It is better done with options (max risk limited to premium paid).
Okay, thanks for clarifying that. I pulled up last weeks chart on FNSR, looks like you may have put that position on following Wednesday's gap down. I'm not trying to "Monday morning quarterback" here, but have to wonder about taking the short side following a megagap down. The volatility in those puts must have been through the roof and the probability of a volatility collapse in the option pricing would be my biggest concern. I don't know who you use as your broker, but with accounts over 100k it's generally no problem to get a level five option approval (naked selling). Typically, I like to sell high IV not buy it. Bottom line, congratulations on another good week. A couple more like that and you'll be back in black for the year.
IRAs don't allow margin or shorting of stocks so just what sort of trades can you do in an IRA? This is a serious question, I'm still trying to develop a trading system so right now my IRA is in stocks and a few bonds that just bounce up and down with the market (so the average return per year over the past decade is around 0%).
I agree. I'd have a heart attack taking the sort of draw downs that neke does. But, damn, it's interesting to see how his account bounces up and down.
How to get a symbol of FNSR and other options? [ QUOTE]Quote from neke: No, that was 150 contracts (representing 15,000 shares). I wouldn't short 15000 shares of FNSR when it was already down more than 35% - the risk would be way too much. It is better done with options (max risk limited to premium paid). [/QUOTE]
Weekly Update for week 10/50 ended 3/19/2011 Another nice week, up 23K (7.5%). It was a week of "shoulda coulda". Just failed to benefit much from the volatility, instead had quite another scare on Wed when I was too quick to call over-extension in moves, and went long (stock and options) too many names. Ended the day just a tard lower, the big loser being SPY calls (7K). Thur saw nice action with LULU put after their earnings. Fading NKE on friday however was unsuccessful. Still working hard to define rules for managing correlated risk (too many positions in same direction) where market is throwing up so many trades at the same time. Code: Opening Balance: 309,205 Net gain for the week 23,305 ------------------------------------------------ Net Balance: 332,510 Number of Trades 22 Number of Profitable Trades 13 Since Inception of Thread 01/8/2011 - 3/19/2011 Opening Balance: 335,899 Net loss(Less Margin Interest) 3,389 (Down 1%) ------------------------------------------------ Net Balance 332,510 Number of Trades 166 Number of Profitable Trades 94 TOP/BOTTOM DISCRETIONARY TRADES TICKER ENTRY DATE/TIME EXIT DATE/TIME QTY PURCHASE AMT SOLD AMT GAIN/LOSS TYPE LULUMAR19201180.0PUT 2011-03-17-09-32-50 2011-03-17-10-40-34 10000 30000 48420 18268 LULU put FSLRMAR192011160.0PUT 2011-03-15-09-41-43 2011-03-15-10-50-38 5000 35000 47125 12038 FSLR put ---------------------------------------------------------------------------------- SPYMAR192011126.0CALL 2011-03-16-09-40-51 2011-03-16-15-12-15 10000 23980 18000 -6131 SPY call NKEMAR19201175.0CALL 2011-03-18-09-31-51 2011-03-18-10-36-45 10000 29000 22000 -7144 NKE call