stuck...novice mistake...what do u think, PFE

Discussion in 'Options' started by citizennobody, Jul 1, 2003.

  1. I got stuck screwing around with PFE...

    28 @ JUL calls 37.50 @ $0.36944 (pyramid down to this average cost)

    20 @ JUL calls 40 @ $0.15

    Stock moved a little down and option value dumped, no choice but to ride it out now! YEE HAW!!!!!
     
  2. you crazy, the only thing that you will ride is your account, ride it all the way until you go through most of it. Dump it, and put your money into something that can get you on your way to start rebuilding your account for this loss. Don't start a mutual fund from options.
     
  3. Cover ...
     
  4. jessie

    jessie

    Your first loss is always your best loss. Get out, cover, and put it in the "lessons learned" file.
    Jessie
     
  5. PetaDollar

    PetaDollar Moderator

    Look, from a MM standpoint, bet should be about 5% of the account size. So you might want to take a look at that first. Hopefully your whole account is not wrapped up in these options. I did that once too (I lost).

    That being said, it looks to me like PFE is headed back up since it formed a hammer today. Not a bad entry for a new long anyway. I would exit my hypothetical new long position if it closed under $33.50, the bottom of the hammer. Last night when I looked PFE was at support, this hammer means it bounced off that support. That doesn't mean it won't break down through it tommorow, just that it is more probable to head up now.