On a great suggestion from a friend, I will be aggregating all my recommendations and their performance till now. Below excel shows that:
As I once heard - 'Day trading is not about knowing the market, it's about knowing yourself.' As of mid 2011, I have dabbled in options. Started with covered call and moved on to spreads. My linkedin profile is:
Tuesday, June 26, 2012
Monday, June 25, 2012
Long NOK
I am long NOK today. I think the stock is oversold and will bounce back in the next few days. It also took additional beating due to the market being down today.
I havent engaged in my strategy this week and stayin in all cash on that front. GDP data and consumer confidence data will be released. Such major events could cause big movements, especially on the positive side, which is the worst outcome for my strategy. So no updates on that. Sitting at around $4k gains or 30%.
I havent engaged in my strategy this week and stayin in all cash on that front. GDP data and consumer confidence data will be released. Such major events could cause big movements, especially on the positive side, which is the worst outcome for my strategy. So no updates on that. Sitting at around $4k gains or 30%.
Thursday, June 21, 2012
Week 10
Stock assessment:
Market is down 1.5% as of mid-day due to weak factory data. Tech stocks however, are mixed. FB has found a solid bottom, while AAPL remains resilient. This is a good time for a short term AAPL strategy, as it will rebound on any good news.
However, I would stay away from the market next week as GDP and Consumer confidence data gets released. Market may move direction-ally and I wouldnt want to be on the wrong side of it. However, AAPL in these situations is great as it is usually thought to be delinked with the US economy and behaves independently of it.
Spread strategy:
I closed out my positions today. There was a major upswing due to high vol and didnt make sense going into Friday to see full gains. I have made 20% gains this week on the money in market and about 10% on the total portfolio (I kept half portfolio in cash). Here are the charts:
Market is down 1.5% as of mid-day due to weak factory data. Tech stocks however, are mixed. FB has found a solid bottom, while AAPL remains resilient. This is a good time for a short term AAPL strategy, as it will rebound on any good news.
However, I would stay away from the market next week as GDP and Consumer confidence data gets released. Market may move direction-ally and I wouldnt want to be on the wrong side of it. However, AAPL in these situations is great as it is usually thought to be delinked with the US economy and behaves independently of it.
Spread strategy:
I closed out my positions today. There was a major upswing due to high vol and didnt make sense going into Friday to see full gains. I have made 20% gains this week on the money in market and about 10% on the total portfolio (I kept half portfolio in cash). Here are the charts:
Monday, June 18, 2012
End of Week 9
Spread Strategy:
I am at $3,000 on a $12,500 base. Since I added money to the account going from $5,000 to $12,500, I need a different measure of performance. I have taken IRR as that is the industry standard when new money gets added, and also gets done in my venture capital industry. The IRR I will calculate is on a daily basis and my target is to get to 0.7% as my strategy clocks out on that long term (after transaction costs and bid-ask slippages). I am at 0.58% today. Below graph is just the portfolio value versus the input money. Next one is the evolution of the daily IRR:
Sunday, June 17, 2012
Ex-dividend date
So on my vacations in Detroit, I got this serious sounding VM from Optionshouse. SPY was going ex-dividend the next day and my option positions were in trouble. I had 90 minutes before market close and I was on a cruise ship away from the shore with intermittent cell connection.
What happens on an ex-dividend date: Stock falls by the amount of the dividend, calls on the stock fall by the same amount, puts rise. However, if you own the stock, you get the dividend and stock falls by the dividend amount - so net nothing happens to you. If you own the call option, it falls by an amount while you do not get any dividend. The call option is an option to acquire the stock (and not any dividends). Thus, being long on calls means you loose major value on the ex-dividend date.
Thus, I had to get to the shore and call my broker. I did so around 30 minutes before market close on Thursday. Closed all my positions at market price (which means I lost major money there) and came out in cash overall.
This week has been great for me, apart from some value lost in the close. I am up around $2,900 - will put up the graphs tomorrow, when I start a new spread.
Market assessment:
FB, ZNGA are both up. My bottom call was right and I will close out tomorrow when the Greece new further lifts these stocks. AAPL options are also dark green by now. Maybe time to sell, but not sure now.
What happens on an ex-dividend date: Stock falls by the amount of the dividend, calls on the stock fall by the same amount, puts rise. However, if you own the stock, you get the dividend and stock falls by the dividend amount - so net nothing happens to you. If you own the call option, it falls by an amount while you do not get any dividend. The call option is an option to acquire the stock (and not any dividends). Thus, being long on calls means you loose major value on the ex-dividend date.
Thus, I had to get to the shore and call my broker. I did so around 30 minutes before market close on Thursday. Closed all my positions at market price (which means I lost major money there) and came out in cash overall.
This week has been great for me, apart from some value lost in the close. I am up around $2,900 - will put up the graphs tomorrow, when I start a new spread.
Market assessment:
FB, ZNGA are both up. My bottom call was right and I will close out tomorrow when the Greece new further lifts these stocks. AAPL options are also dark green by now. Maybe time to sell, but not sure now.
Tuesday, June 12, 2012
Tech stock assessment:
ZNGA fell some more due to a bad analyst report. I am calling bottom on this one. Long $5K on it.
AAPL is strong though did not outperform the market. But that is expected. On bad days, investors rush to AAPL and on good days, they speculate on other stocks. I still dont have a fool-proof strategy to capitalize on this action, but this will be temporary as long as their is market uncertainty. I am still long AAPL options.
FB is coming off the bottom. The bad ZNGA news did not deter the stock - that is a very bullish signal. I will think of going long tomorrow.
Spread strategy:
It is working. Another 6% gains today (on a base of $12,500). I am now up 8.7% since the start but still haven't reached my "highs". Don't have any views on the market tomorrow, but the bullish sentiment might continue which will be great for for strategy.
ZNGA fell some more due to a bad analyst report. I am calling bottom on this one. Long $5K on it.
AAPL is strong though did not outperform the market. But that is expected. On bad days, investors rush to AAPL and on good days, they speculate on other stocks. I still dont have a fool-proof strategy to capitalize on this action, but this will be temporary as long as their is market uncertainty. I am still long AAPL options.
FB is coming off the bottom. The bad ZNGA news did not deter the stock - that is a very bullish signal. I will think of going long tomorrow.
Spread strategy:
It is working. Another 6% gains today (on a base of $12,500). I am now up 8.7% since the start but still haven't reached my "highs". Don't have any views on the market tomorrow, but the bullish sentiment might continue which will be great for for strategy.
Monday, June 11, 2012
Market Assessment:
While the Asian stocks rallied, US did not and lost value. VIX is high again and hitting the 25 mark. AAPL is staying above market for a while and is ready for a robust rise up to the earnings. It beats markets almost all days. FB is rising from the ashes. Good time to buy. Will also add ZNGA to my analysis now. The stock is down 8% today and while FB seems to have bottomed out, ZNGA hasnt. While their fortunes are linked, in the short term, they are not. I will be long ZNGA in the next few days. A decent pop from $5ish to 7ish can be expected, once FB starts to stabilize (which it has already done).
Strategy:
Last week, was the most brutal of them all. Stocks rose irrationally and wiped out all of my gains and pushed me into loss territory. There was no mercy and even closing positions was tough given the high vol (of option prices) June 6th and 7th I lose 12% and 10% respectively. Today was the best day till day as I made 13% in a day and back in positive. Now my base is $12,500 and I currently stand at $12,747, a measly 2% gain. Note that the highest I went was 40% gains on a base of $5,000. Have to be patient here. I have also reduced the riskiness of my strategy, so hopefully, losses from now will be lower.
While the Asian stocks rallied, US did not and lost value. VIX is high again and hitting the 25 mark. AAPL is staying above market for a while and is ready for a robust rise up to the earnings. It beats markets almost all days. FB is rising from the ashes. Good time to buy. Will also add ZNGA to my analysis now. The stock is down 8% today and while FB seems to have bottomed out, ZNGA hasnt. While their fortunes are linked, in the short term, they are not. I will be long ZNGA in the next few days. A decent pop from $5ish to 7ish can be expected, once FB starts to stabilize (which it has already done).
Strategy:
Last week, was the most brutal of them all. Stocks rose irrationally and wiped out all of my gains and pushed me into loss territory. There was no mercy and even closing positions was tough given the high vol (of option prices) June 6th and 7th I lose 12% and 10% respectively. Today was the best day till day as I made 13% in a day and back in positive. Now my base is $12,500 and I currently stand at $12,747, a measly 2% gain. Note that the highest I went was 40% gains on a base of $5,000. Have to be patient here. I have also reduced the riskiness of my strategy, so hopefully, losses from now will be lower.
Wednesday, June 6, 2012
6/6/12
Market assessment:
I brought AAPL options today. With the iPhone launch and 2Q earnings coming up, I expect upward movement. I am long $580 August calls. FB also jumped today. Morgan Stanley started shorts on FB stock. That should put more downward pressure on the stock. I am still not playing in FB options as they are not that liquid and bid-ask spreads will kill any short term strategy.
Spread trade strategy:
Market moved 2% today and I lost a bunch of money. Overall, I am still positive, but today was one of those days that I would like to learn to avoid. My strategy only works if the market doesn't move much. I am predicting some downward movement tomorrow where I recoup some of my losses.
I brought AAPL options today. With the iPhone launch and 2Q earnings coming up, I expect upward movement. I am long $580 August calls. FB also jumped today. Morgan Stanley started shorts on FB stock. That should put more downward pressure on the stock. I am still not playing in FB options as they are not that liquid and bid-ask spreads will kill any short term strategy.
Spread trade strategy:
Market moved 2% today and I lost a bunch of money. Overall, I am still positive, but today was one of those days that I would like to learn to avoid. My strategy only works if the market doesn't move much. I am predicting some downward movement tomorrow where I recoup some of my losses.
Tuesday, June 5, 2012
6/5/12
Options strategy:
Put in the maximum exposure that i have had till now. Around $7000 in the market. Closed around $30 down. Now that i am getting commissions charged, i paid $60 in commissions to set up the trade. Now i need really good performance as 2% will be lost every week on commissions itself. I will be transferring more money to the account soon so that the commissions (which are more like fixed costs) become a smaller and smaller percentage of the returns.
Market assessment:
Markets rose from a belly flop last month. I am sure you must have heard "sell in may and go away" ... many people seem to have done that. AAPL was down while the market was up. I think i should have brought AAPL options today while they were cheap. I will try again tomorrow. It is a nice play right now with VIX high but not very high.
FB continues to fall. There will be buying at $24 for me. Maybe sell puts at $15 as I dont think it will go down that much in the short run. The next earnings will be key and FB-VIX will rise. It may make sense to go long on properly designed FB options, with less delta and high vega.
Put in the maximum exposure that i have had till now. Around $7000 in the market. Closed around $30 down. Now that i am getting commissions charged, i paid $60 in commissions to set up the trade. Now i need really good performance as 2% will be lost every week on commissions itself. I will be transferring more money to the account soon so that the commissions (which are more like fixed costs) become a smaller and smaller percentage of the returns.
Market assessment:
Markets rose from a belly flop last month. I am sure you must have heard "sell in may and go away" ... many people seem to have done that. AAPL was down while the market was up. I think i should have brought AAPL options today while they were cheap. I will try again tomorrow. It is a nice play right now with VIX high but not very high.
FB continues to fall. There will be buying at $24 for me. Maybe sell puts at $15 as I dont think it will go down that much in the short run. The next earnings will be key and FB-VIX will rise. It may make sense to go long on properly designed FB options, with less delta and high vega.
Monday, June 4, 2012
Hold on strategy and market assessments
My strategy works for VIX<25. VIX passed that level on Friday, so no more trading for me till VIX goes back below 25.
Till then, I will publish some market commentary and see how that works:
Today AAPL beat the market in daily performance while Facebook suffered more than the market. There is a bottom coming up on Facebook, at which there will be a major buying pressure. I think the bottom is around $24-25 where most of the research analysts are predicting the intrinsic value of the stock.
There is also a strategy on AAPL options in the short run. There will be a run up in AAPL stock upto its next earnings in July. Options are the cheapest way to play there. If the market does not fall down further tomorrow, I will open some long call positions on AAPL expiring in August, after the earnings.
Till then, I will publish some market commentary and see how that works:
Today AAPL beat the market in daily performance while Facebook suffered more than the market. There is a bottom coming up on Facebook, at which there will be a major buying pressure. I think the bottom is around $24-25 where most of the research analysts are predicting the intrinsic value of the stock.
There is also a strategy on AAPL options in the short run. There will be a run up in AAPL stock upto its next earnings in July. Options are the cheapest way to play there. If the market does not fall down further tomorrow, I will open some long call positions on AAPL expiring in August, after the earnings.
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