I agree I am focused on the stopping of the leak. I believe that news will pop the stock up higher and in a hurry. I do not agree that it could easily cost 100s of billions despite what some may say in the media. Oil prices are holding up and BP is not just one company. It is multiple companies and litigation takes years (see exxon for example). So far we have not actually seen much in terms of lose in terms of "destruction of millions of lives and the crushing of incomes and real estate" in my opinion. We have seen the news talk about some of this but it is my experience that what the news talks about and what is really the result is not always the same. Clearly though I have been wrong yesterday and perhaps today (I moved from stock to options so this has yet to fully play out and could end up better or worse in the coming days). My best guess is that those who are talking about a BK are also trading the stock and have an incentive to drive the price down. Best Robert
bottom fish yes but you make it appear as if I held since 50. The truth is I have been both long and short BP since above 50 and before yesterday have done well. after today I doubt that I will end up a net gain with BP but it is not out of the question either. BTW, are you short and or trading BP? I would like to think someone talking about a stock and how another is not trading it correctly is walking the walk.... Best Robert
Yes robert i strictly day trade it.You are sadly mistaken as i have friends in destin,fla and they say its devastated as the oil has scared all off. And to compare exxon valdez with this is like comparing a f-16 to a cessena.Valdez was in a small area and affected few people. This is massive and long term. Obviously the mkt agrees with me.Robert the only way you'll ever grow as a trader is to obey the mkt signals and not become emotionally involved.
Robert, I will not comment on your trading. Instead I would like to commend you on being open about your trades, your P&L and your thought process regarding this stock. Taking the time and effort to respond to posts in relation to unsuccessful trades isnât always fun but you did just that. All the best to you! /k
Sorry to hear you got beat up Bob, but perhaps a good kicking is what you need. I mean that in the very best sense because anyone who has improved has had to learn how not to get beaten that way again. That's what experience counts for in the market. As they say: everything that can be known about a stock is reflected in its price. So the real skill is to know how to interpret, weigh up and discount news but sometimes that requires insider knowledge of an industry to properly qualify news. Word was there is a bigger leak elsewhere and BP is glad to have the heat all on this one. True of False? We will see. In any event is was a train wreck on the charts and would require insider information of the highest quality to take a decision on bucking a simple bear crash trend. There you have it Bob. One of the biggest news events is unfolding that will go down in history as the largest oil disaster ever and with it a bear crash on BP... and you rode it the wrong way. And you made it an open record in your public journal. Now if that doesn't do some good for you and help some others, well nothing ever will. So here's to learning something from this the hard way and up and onward for you And thanks for sharing your lesson with other traders!
What you are doing is trying to argue with yourself to convince yourself that you were right and the market was wrong. You are trying to justify your actions to yourself so you do not feel any responsibility for the trade despite the large loss. This is a common mistake we all make when we have a big trade go against us. However the market is always right and stocks do exactly what they are supposed to do. You are trying to convince yourself really hard with the following but think it through: - "once they cap the leak the stock will pop" why? is that written into the law somewhere? The oil has been running into the ocean for almost 60 days and we are close to 60-70 million barrels of oil leaked and you think that capping it now will shoot the stock back to $40? Maybe, but you are saying it with so much certainty clearly your trade is no longer objective and that is the first step to huge losses. - "the stock cannot go bankrupt" - who cares about bankruptcy. You will go bankrupt if the stock dropped to $20 so you should care less about the fortunes of BP and more about yourself. It does not matter what will actually happen with BP, it only matters what PEOPLE THINK will happen as the sentiment is enough to push down a stock. People are boycotting the gas stations and BP is seen as the devil by most people. Fair or not that is going to affect perception and whether or not someone will buy the stock. You don't think large funds were dumping the stock all the way down to get out of it and separate themselves? Why would they rush back in now, just because a leak was capped or it is at new lows? If you think BP should be fine and not go bankrupt, that is fine, but if you are alone in your thinking or the sentiment is strongly against you, why fight it? - "litigation takes years, oil prices holding up BP, BP is larger than BP America, etc.." these are all excuses on your part to justify why the market is WRONG for dropping so much. BP could snap back to $40 if the market has a strong rally and oil hits $80, it could also just be a lot of short covering today since the momentum slowed down. It could be that the World Cup is starting or it could be that the Gores are divorcing. It could be 100 different things so the worst mistake is trying to justify staying in when it is raging against you and then adding more risk. You were down $5k, good time to get out. Not trying to put salt in the wounds but it would have been fine if you just kind of turned a scalp into a major position and realized the mistake but this is a lesson for all of us. When a trade turns SUBJECTIVE and we think we know more than the market or try to tell the market what it should do, that is when we lose the most money. Also never martingale a subjective trade hoping for a bailout.
Started early today but didnât trade After closing out my large long with BP yesterday and rolling it into options I was quick to get up early today to check and see how the trading was going. About 5am I woke up and half asleep went to my computer. I was so tired that when I looked at the current price I thought I was looking at the current price action of the main large puts I wrote into the close yesterday. As I saw the price climbed over $3 I sat in horror for about 10 seconds until I realized I was looking at the actual stock price (which is how I set it the night before but was still half asleep) and just smiled and went back to bed. After getting up later I more or less laughed at myself as the options were not even trading at that hour but I gave myself quite the scare. I was short volatility but with a strong long bias. I wrote about two puts for every call and I was really hoping to see the price open up about $2-2.50 higher today. Seeing it about $3 and change was good enough for me and I was able to recover some of what was still open losses even after closing out a loss yesterday. Interestingly enough the IV did drop as expected in the early trading but then went right back up again and stayed strong for much of the day. As a result I am smaller than yesterday and have a stronger long bias but still carrying the options into tomorrow. I also bought some BP stock in afterhours to hedge the calls as I am thinking yesterday was very likely the low for the move. If given a chance tomorrow I will roll out of the stock and write DITM puts as a replacement for owning the stock outright. While almost totally focused on BP and being very tired I actually did have some smaller trades today as well. I stayed very small and set super wide distances between the scale points as I did not want to tie myself down with a large BP trade and then another trade to divide up my focus. These went well and while I had to take a few stops it all adds up. I also came close to shorting GS puts again after closing out yesterday but holding to see if we can get a big down day and have the IV spike to do so. The gains in BP actually are a result of mostly being short the stock in the opening. It moved up so much that I put on a 200 share short thinking some profit taking would happen at the start and that it would not simply open and run. BP + 122 BP Jul 25P + 684 BP Jul 27P + 127 BP Jul 34C â 326 BP Jul37C â 184 CECO + 14 SKX + 17 THO + 73 + 530