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Thursday, June 3, 2010

A small reminder abuot "other people's plans"

From a blog entry that I started on June 3rd:

"One thing that I have always said is that if I plan to trade someone else's plan that I must plan to trade the plan exactly as it is laid out...otherwise I run the very real risk of spoiling the results or even posting losses when the plan is profitable.

Today was a small reminder about that idea as I decided to close a trade for a small profit. It was the only call option trade of 15 and the trade has been at the 80% loss level at one point, over 100% gain at another point and I closed it for about a 15% gain. Given the market I thought it prudent. Of course it went down to a loss position and headed back up for a higher price than I closed it for. I don't mind as I was fretting over it just a bit... even though it was a 2 contract trade... funny that."

Well, that trade was a June call...the only call on the list and I didn't really feel like letting it close for a loss. So it is fine that I decided to do what I did but today I would have been able to close the $1.95 contract for up to $3.70... trade the plan. Now, on the other side I have made a few deviations that were more profitable than the plan, but I expect that those are harder to get right if not by accident.

Jeff.

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