I wonder if you are drawing the correct lesson from your experience? Sometimes the dips don't dip back. Buying on dips and holding on no matter what is a typical newbie strategy and it actually works much of the time. But when it doesn't, look out. The dips dipped back because we are in a strongly trending upward market. The next time you resolve to hold on no matter what, the market might be in a decline. Then your position won't bend back.
Yeah, I know what you mean. The TWO FOREMOST LESSONS I got out of this were: 1) Money Mgmt - Don't bet too big of size that it will destablize you and put you on the brink of WIPE OUT! I'm still trying to recover from it. 2) Cutting losses FAST! I should have gotten out my ENTIRE position on the FIRST LOSING day! Rather than wait the following day for it to COMPOUNDED! So, instead of biting the bullet and taking a $3K+ loss on the first day, I held on and took a nearly $6K loss the next day! Also, I shouldn't be daytrading options when the barriers are too big, spread and decaying characteristics. oh well. oh well. we have to learn the HARD LESSONS firsthand to appreciate it. misc
I assure you that what happened to you will never happen to "THEY". Now the home work to you (due at the end of this summer) apparently is to figure out and tell us aloud on this forum what maybe you already knew deeply in your heart, that is what and why my statement above is true.
I bought it at $4 initially, and averaged down to about $1.70 with about 8000 shares. Sold all 8k with that $1.70 basis one morning in premarket when it was gapping from 34 cents and opened at 26 cents. I thought I did pretty well to get out at .29 considering it opened at .26 and dropped to .19. I want to add that this was a fundamental play. I study the financials and fundamentals heavily and understood the technology. The bad news that morning and the debt made it seem like they just weren't going to make it. And who the hell ever comes back from below 30 cents? without a reverse split? I have averaged down on everything I believe in. I wouldn't recommend it to any of you trader types - if you didn't buy it on fundamentals, then you probably shouldn't add to it as a loser. Averaging down and writing a lot of options against underlying stock has worked very very well for me over the years. I've had very few losers. I just giggle every time I see SONS go across Bloomberg near $5. It's like the old girlfriend who turned into Julia Roberts or something. 29 cents.
On Jan 3, 2001, I was caught heavily short when the fed put in a surprise mid-day rate cut. I lost $2,500,000 in about five minutes. Can anybody top that? :eek:
Back in the fall of 2000, before I started trading full time, I was swing trading a small account ($6000), I had been using to 'practice' trading. I was at work and decided to take a postion in Apple one minute before the close. I was fully margined at what was then 2:1. Right after the close, Apple announced an earnings warning and the price immediately dropped 50%. My account was completely wiped out in a matter of a few minutes. I now look at this as a valuable lesson learned for a 'relatively' small price, but at the time I was shellshocked.
I remember that day. I was thanking my lucky stars that I was flat when that happened. (Well, being long would have been nice, but I'm glad I wasn't short!) The Nasdaq was up just shy of 17% that day. Add leverage to that kind of move and it could be dangerous.
guess what?!! Those june 35s calls that I sold at a HUGE LOSS ($6K loss on my small acct) down at 20-30cents. I got them in at 40-45cents. They are up like 2.25-2.40!! WTF?!! That's like over 5x!!! Instead of taking a 50-70% I could be up 500% to over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
Damn bro, that is sweet. I loaded longs that am, then went to Home Depot and heard the news on the radio driving home. Best thing was being away from the trading room... Okay, now on to the good stuff... bought a boatload of EFII in the 49's in the late 90's. It was early December - walked into the trading room the next day. Sit down at the computer, look up, everyone is staring my way. Manager comes over, hey thought you should know, EFII warned. How bad, I ask. It's trading at 13... I'm like thirty? No dude, ONE frigging THREE. Tripled up and hung on and dumped it a year later. Sheesh did I suck.