This news yesterday got me thinking.
http://blogs.wsj.com/marketbeat/2012/05/01/options-traders-cast-cold-eye-on-stock-rally/
Options traders, the smart money, has bet on the downside. That too by the end of the week. There are these substantial bets that were being discussed. I had two choices yesterday: (a) take a similar stance on my positions - and create a heavier downside protection (or remove upside gains), (b) do nothing.
I decided on (b) as my original strategy entails no changes to the portfolio unless it looses 40% of its value. I am also trying to optimize this decision - 40% seems just too large. The jobs report as was speculated yesterday, was bad but the stocks did not move too much lower. While SPY started low, iut has gained back most of its gains since the morning and is at -0.29% while the NASDAQ is in green.
There are two more major reports in the next two days and they could hurl the market downwards. I still think it will hang around these levels till the end. My strategy makes most money if SPY closes around 140.75. Portfolio at $5,622.73.
http://blogs.wsj.com/marketbeat/2012/05/01/options-traders-cast-cold-eye-on-stock-rally/
Options traders, the smart money, has bet on the downside. That too by the end of the week. There are these substantial bets that were being discussed. I had two choices yesterday: (a) take a similar stance on my positions - and create a heavier downside protection (or remove upside gains), (b) do nothing.
I decided on (b) as my original strategy entails no changes to the portfolio unless it looses 40% of its value. I am also trying to optimize this decision - 40% seems just too large. The jobs report as was speculated yesterday, was bad but the stocks did not move too much lower. While SPY started low, iut has gained back most of its gains since the morning and is at -0.29% while the NASDAQ is in green.
There are two more major reports in the next two days and they could hurl the market downwards. I still think it will hang around these levels till the end. My strategy makes most money if SPY closes around 140.75. Portfolio at $5,622.73.
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