Friday, September 3, 2010

More than one year

I changed.

  1. Recent gains are due to playing swing trades correctly, most of them are from the long side.
  2. Recent losses are due to option buys, most of them are from the short side(bought puts).
  3. I won't buy options in the future, unless it's an extreme market.
  4. I will write options, this way I keep a distance from the assigned value, and even assigned, may turn out to be a winner. The key is following:
  5. It has to be OTM puts, I can't choose ATM puts, the buffer is too small, specially use 3x ETFs.
  6. It has to be sized correctly, that is, 1x, 2x, 3x, 4x, turn aggressive at the end of the move, not the beginning, most of the cases, sitting on the sideline.
  7. The key is not to lose money, not to be in the market all the time.
  8. I invested huge amount of time in trading, and learned a lot, but now is time to do the most smart move: play small, play smart, and be a risk taker.
  9. Like play poker, I know I can win certain games, but if I play big tourney every weekend, I'll lost in a few weeks, since the odds is just to small.
  10. Same as in the market, I need to play only when I sense it's an overbought or oversold market, and it's near the end of a move.
  11. Sometimes, take quick profit is a great idea, even I miss the rest of the move; but sometimes, it could be a huge winner, like I bought early August(around 12th) when marekt tanked, I could sell at middle of August, when marekt rallied for 3 days, I didn't. All these TNA,TYH and MWJ, went from quick 4-5% gain to 5-10% loss. Yes, I sold today for a gain, but I could have 20% gain than this 5% gain. So, don't be greedy, and when I was right for a quick profit, take it.