Hindsight is always used incorrectly to punish one for following a trade plan. The market could have easily gone from 1220 to 1200 and paused for the SET. If you have a risk plan, follow it 10 out of 10 times. If the market tanked, you would all be saying how great it was to get out before more damage. Now one should not be saying how bad it was to get out because the market reversed. If you knew 100% it was gonna reverse, then no one should have adjusted at all. Some of you are using more aggressive strikes than me where the profit is higher, but the losses are higher too on closings or adjustments. I was just tallying the math from my adjusted positions and when all is closed tomorrow, I will probably have a loss of $3,000 or so- less than 1% on risk. Think ahead how much loss you would bear before bailing and what hedges you could put on to reduce the pain somewhat. Maybe 5% of risk capital is a good cap, maybe 10%. Self analysis and review is required and will help you find the zone.
Got filled on the call side of my diagonal around 1350 (SP futures): B Aug 1330 S Jul 1310 @ 60 debit Will avoid the mistake I made on the last trade (thanks for your advice). If market goes to 1290, will probably look to liquidation rather than going scared into the put leg.
That's why I posted my thoughts in the first place, it's very theraputic to write down the way you feel about a trade and have people validate the actions you know were correct. My gut's feeling a bit better now...thank's rally, coach and others.... ....my account is also thanking you for uttering the words "Risk Mgmt" as well.....
no prob, just wait until you go through this same situation a few more times, after that you will feel nothing whatsoever, and will be just adding to your market experience database.
Scienter, I didn't loose money this month. My hedges covered all my Spread loss and I end up with 7 to 9K profit (still to be determined). I have to take some time to understand your question and then I will reply. Piccon
Scienter, Lately and especially in this market, It's easier to predict a top reversal than bottom. My indicators work better on overbought conditions. You can go 40-50 points above the point at which there is an overbought signal and most of the time you will be safe but detecting a bottom even with oversold condition, I wouldn't encourage you following this strategy in the next 4 months. The market may remain oversold for a long time. Bill Clinton is the best at picking bottom (Monica). What I think could work best, is to open your Bull Put (below Support) or Bear Call (above resistance); then you can buy the SPY PUT or CALL at 30 points from your short Strike. This has given me the best protection so far. Don't be affraid to spend up to 40 -50% from your credit to protect your Short( Queen). You can make money on both (Spreads and hedge). MHO
I probably need to rewrite these to make them clearer: http://www.elitetrader.com/vb/showthread.php?s=&postid=971374#post971374 http://www.elitetrader.com/vb/showthread.php?s=&postid=1095103#post1095103 Double pay day = "Convergence gains"
Coach, why did you go with Maverick's firm after he accused you of all that stuff on this board without having a clue about the real you? Do you trust someone who mouths off like that without knowing what he's talking about?