Hello, Regarding the brokerage bit, I'm a uni student, only trading with a small account for my own practical learning purposes, I'll be looking at alternatives for brokers once I have more capital. My reason for opening a long position in TMTA is based both on fundamentals and technicals. There was a recent PR that TMTA's Q2 will be the first cashflow positive quarter for the company ever (this was announced around July 10). I've been watching the company for about a year now, and judging by their financial statements, they are in the process of finally establishing a solid business model (licensing their IP, sort of similar to Rambus). Cashflow positive and profitable aren't the same thing, but the former is a good step towards the latter. As for technicals, it would appear that the longer term downtrend (begun late October 2004) has been broken, late June appears to have been a bottom, and the stock has consolidated somewhat after the large intraday upwards move July 10. Still more at the overbought end of things than I would prefer, but there were also some nice big block buys going through last week. Going to watch this carefully tomorrow, may end up playing this based on anticipation of Q2 results after the market close Tuesday. E.g. If this makes a big upwards move over the next couple of days, may pull out prior to earnings PR. Can't explain much more than the above, the stock just looks strong to me right now.
http://www.bloomberg.com/energy/ i look forward to mondays (not like before), but only when i have positions. i'm also a "gambler" at heart. i'm just glad that i'm able to control my impulses much better now. experience and reading a lot of books on investing/trading have helped me with that. i have a spreadsheet that calculates the daily mark-to-market values of my account and i only judge my performance on the weekly basis. in this regard, i have succeeded in making sure not to let my gambling impulses control me. i've missed opportunities, but one of the most important things (maybe the most important) that i learned is that this is a "continuous" game and there will always be opportunities out there. you just have to make sure you're not wiped-out to take advantage of these future opportunities. i can't tell you how many times i've wiped out in the past 5 years, and not be able to take advantage of what i thought were great opportunities. they don't feel good, that's for sure. i hate holding through earnings! i avoid it if i can help it. i didn't hold my KLAC and VPHM position through earnings, and i was even willing to sell at a loss on VPHM just so i wouldn't hold it. i would only keep the position if i have other reasons, or if that is the only reason for the position (as was the case with QCOM). i felt confident in holding QCOM because i've played them many times in the past. after earnings is a different story, though. i have 2 posts on another thread explaining why there could be opportunities after earnings. it's the reason for my NFLX play and only time will tell if i'm right on that. http://www.elitetrader.com/vb/showthread.php?s=&threadid=53371&perpage=6&pagenumber=4 ebay was one i was looking at after their earnings and guidance. i was gonna put a position with Jan 06 Ebay 42.5 calls, but i missed it. i was looking for an opening to put a position if it's around 40/share which happened on July 26. i chickened out and had an excuse that i already had enough position for my account. my target was for the stock to hit 45 within a month or two, but i probably would have closed it last thursday or friday when it went above 44.5 and crossed it again on the down move. the reasoning for the trade was their latest ER and guidance was enough to change the stock sentiment to positive and given where the stock was trading, it could easily trade to $50 given enough time. my target of 45/share was reasonable and would have given a nice risk/reward for a small risk capital. so, i guess you could say that this would have been a 50-50 technical and fundamental trade. i'm not really a fan of goog. i'm actually waiting for it to break to the downside and willing to buy some long-term puts on it. i don't really look at any oil plays, but if was going to, i would look at puts. i'm not bullish on oil for the long-term but that can change if i see a signicant news that will change my mind. i try to keep an open-mind so that i can easily buy calls as well as puts on the same underlying depending on what i learn. cramer? he's fun to watch... i think he's good for the markets and there might be an opportunity to ride on his calls. i heard his makes an impact on the stocks discussed in his show. he could be the next gilder and that could make for some profitable opportunities. Good luck!
Hi Choad: Last year I didn't have a system, I bought PLMO (now palm) aug 12.50 calls at the end of March when they were trading for .90 based on the treo launch. I thought it was and still think a very good product, regardless of the quality problems it had/s . That trade alone took care of 2004. So I got lucky, as when preparation meets opportunity. Believing that in 2005 I could turn 100k into 1M just as easily killed me. I got burned hard at the end of last year's out of nowhere rally and again during this years May overextended rally. In reference to my present trading system. I am still in the developing stages. I primarily trade div on MACD's, going 50/50 ratio of puts vs calls. No greeks, just time considered. Cheers !
Hi Palawan: I can't remember if I have read any of their books, so I will pass on choosing. After reading your posts, you reminded me of the way I used to trade. It is indeed a form of gambling that can payoff at times, but to make a living trading what one thinks or assumes in the long run doesn't work in my experience. I have what I believe could be constructive criticism regarding your trading methodology if you would like to have it. Let me know. Cheers !
Greetings, Optionpro007 my initial reaction was to ask you for the comments regarding my trading methodology, but i've decided not to for now... if it's still available, i'd like to request it later? thanks. the reasoning was that any comments would help me to be on the lookout for any problems with my trading style. in thinking it through, though, i'm more worried that it might affect my whole outlook, then i'd be in trouble as i'll be lost and not be able to plan my trades accordingly. Good Trading to you. Thanks.
In theory, for me to be able to be fully invested or have all my trading capital at work all the time I have to minimize my exposure as much as possible. Example: Tomorrow Bin Laden is caught, the markets rally strong. Tomorrow an atomic bomb goes off somewhere the markets tank big time. Events that problably won't happen but that can whipe an acct if you have all your capital in only one side of the market. So, I mention in theory, becuase it is not easy to establish positions with the same amount of calls and puts after a few months of a strong rally or months of a deep selloff. The best way is to diversify out of the stock market and into futures and currencies. Unfortunately liquidity in options in the last two makes this job impossible and one is forced to trade the futures contract. So to answer your question having the same amount of $ in puts vs calls at all times. Getting the most out of your trading capital with the least amount of risk.
mini update 8/11/2005: NFLX Dec 22.5 calls qnqlx - sold for gain of $675 (minus comm). could have gotten a lot higher for it 2 days ago, but hindsight is 20/20. sold because i'm no longer bullish on the market in the short term. oil keeps going higher (over 65/barrel now), gold shooting up, stocks on my watch are heading lower, and i see the nasdaq closing lower than 2177 tomorrow which would make it 2 weeks that it ended lower. i could be wrong about that, but we'll see... might get back into NFLX later when the markets are ok again IMO. Good Trading.
mini update part deux 8/11/05: entered a position: AMZN Jan 40 puts - risk capital $2400 (plus comm). tentative target for underlying to hit 40 within 1 month. market-related events and/or significant company news may get me to close the position. Peace.
So your style is "market neutral," and you try to earn more than Treasuries by astutely picking longs and shorts?