I went from $7,000 to $52,000

Discussion in 'Trading' started by skillz20, Feb 1, 2008.

  1. Div_Arb

    Div_Arb

    LOL - Great post!

     
    #61     Feb 4, 2008
  2. segaa

    segaa

    With your 20-year experience for sure you are better trader than me, so I just was wandering if you meant hard stops for options or strategies. Usually in the books on options you see risk management implemented through the various strategies and not hard stops . . . and it's SO different from the regular stock.
     
    #62     Feb 4, 2008
  3. skillz:

    I'm afraid in this case, you just blew out your account and you probably don't realize it yet. With all the capital gains you accrued for last year, your going to have to come up to pay for taxes as you won't be able to offset your losses with the gains. You likely hit over $52K in capital gains on your trades.

    Here's a good lesson in money management not only with whats in the account but who you have to owe after you make it. Not only do you work for yourself in this business, but also for Uncle Sam. He wins all the time. Unless you traded in a Keough/SEP/IRA, you are going to owe and its likely going to be more than whats currently existing in your account :(

    It looks like you did well playing momentum equities/options in the 2007 runup and then when they rolled over, you got hurt. By going from $7K to $52K, you did very well (600%). Congrats on that.

    Next time, take 30-40% off the table EACH MONTH IN PROFITS and transfer it into a bank. Leave the rest in the brokerage account to trade and like those who suggested here, use stops - you have to on momentum plays.
     
    #63     Feb 5, 2008