My terrible option trade

Discussion in 'Options' started by jonathan734, Jul 22, 2009.

  1. So I am just posting this as an example to others that may or may not enter positions without doing their homework. I have had a great last two weeks, desperate to continue with my streak I was looking at GS and AAPL for a short term put (overnight). So without even looking to make sure there was no news (earnings) that could pertain to either I bought puts. While I made a little with GS, it was largely overpowered by the loss I took on AAPL. Absolutely unacceptable mistake. Now before I get flamed for this, let me say I don't do this for a living, use money I can't lose, and this is only the second time I have ever done it. The first was supposed to be the last. So let this be a lesson to people that just use charts to trade. Always check to make sure that there isn't some catalyst waiting to blow you up. Now, flame suit on.
     
  2. Stupid and pointless.........
     
  3. O you are crying because you chose to short the two strongest stocks in the US economy. LOL you deserve that. Thats why customers shouldn't trade.

    I wanted to sell 160 AAPL calls on the close yesterday, but I did not pull the trigger because of the strong fundementals. Can't trade on technicals alone buddy.
     
  4. You might present a stronger-case if you could spell fundamental. In any event, I don't recall and fundamental data in any of the option models I use.
     
  5. You can trade off technicals alone smart guy.......get a clue
     
  6. I didn't know I needed to spell fundamental right in order to trade correctly. I don't know what kind of technicals I would trade on when a company's business model is better than ever. Just my opinion.

    I trade solely on technicals, but I always look at the fundamentals for refrence
     
  7. donnap

    donnap

    After a few thousand losses those lessons really begin to sink in.:p
     
  8. lol I thought this might stir some people. I am not necessarily saying this companies will go down long term, just the way I viewed the charts they would go down over night. I was right about GS, horribly wrong about AAPL. Serves me right for making a trade purely off the charts, I am taking my gain on GS as pure luck. O well I am sure none of you guys have made any mistakes in your trades:eek: Still a decent week, I think I will wait till next Monday to start up again. Happy trading guys.
     
  9. Guessing that companies will go down overnight is definitely a great way to trade! I recommend not trading that way ever again.
     
  10. There are so many things wrong with your post and very little of it has to do with it being a losing trade.

    1) Never be "desperate to continue with my streak"

    2) Even if there was no news pending, you can still be overpowered by unexpected news on a very strong or weak day

    3) Unacceptable mistake? This is only the second time you have ever done it? Trading involves being wrong a lot of the time. Get used to it. Size DOES matter.

    4) Don't rationalize. It doesn't matter if you do this for a living or part time. While it may be money you can lose, that's the wrong mindset for trading.

    5) Always check to make sure that there isn't some catalyst waiting to blow you up? That EA could have made you a bundle. It didn't.

    If you're going to trade, learn to manage the losses. That means start with hedged positions or trade tight. Learn to use the pre and post market to support option positions. Losses happen. Try to keep them under control. when they occur, suck it up and move on.
     
    #10     Jul 22, 2009