Wednesday, February 28, 2007
Recouping My Losses
Today has helped me more than recoup my losses from the last big blow up. I closed out an overnight trade in NQ like 20 points ago so my IB account isn't yet back to its all time high, but my Ameritrade accounts, which hold the core position of each trade that I hold for several days are more than making up for it. Ostensibly the cause is the 9% drop on the Chinese exchanges over night and more signs of impending recession. The ten year bonds are up 19.5 ticks at the moment. It's the only green thing on my screen apart from put options :) From a technicians perspective the bottom line is the markets were ready to fall and just waiting for the shock which is why I was net short. The rise in bonds will help balance some of my loss on long stock positions elsewhere in my investment portfolio. It's looking like being a good month unless I do something incredibly dumb tomorrow.
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4 comments:
Hey Moom...just wondering your thoughts on the WTVI stock? curious when is the smart time to buy it . Thanks.
hmmm I wouldn't buy it :) Those kind of stocks are just to illiquid and unpredictable and their intrinsic value is close to zero. If I did trade something like that it would just be intraday on a particular high volume day.
If you want lots of leverage and excitement buy some options on something maybe :P
Ok thanks alot for the input..I really do appreciate it. I"m new to all this. I heard that WTVI was a really hot stock and could potentially skyrocket once they sell to someone which is suppose to be on the horizon. So you said to maybe buy some options? any ones in particular I should look at? I only have about 2k to invest right now since I'm so new to this. Thanks for your input !!!!
A stock like WTVI is worth nothing and you should only trade it with money you are prepared to throw away. Of course, you might strike lucky like Finance Ninja or lose it all. They have granted options to venture capitalists to issue billions of shares. All is not as it immediately seems. With just $2000 it is hard to make money due to commissions etc. Options is one way to get to trade more value with a small amount down, but very dangerous too if you don't know what you are doing. To be successful in trading you need some kind of model or edge and trading rules. What you buy or sell is in fact less important really. But I'd steer away from too volatile, worthless, illiquid penny stock, pink sheet things. I pretty much only trade the NASDAQ index using ETFs (QQQQ), futures, and options on QQQQ. Occasionally I still do trades on stocks like Apple or Google or Microsoft which won't suddenly do something crazy have very close spreads between buy and sell prices and are very liquid.
I could tell you to buy a boring mutual fund for the long-term :) but if you really want to trade start with options on QQQQ or trading those kind of stocks I mentioned around their earnings announcements etc. Read trading blogs/books, join Silicon Investor or Elite Trader. I have some links to good trading blogs.
Hope this helps.
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