Speculative contrarian investing (Part II)
As I was working I placed some quick orders and lost $100 on an ordering mistake. By the end of day Friday I was alreay down $250-$300 on an investment $1500 for 10 call options at 107.
I waited patiently (actually I was nothing but patient). When you have your hard earned money on the block you can not be patient. The weekend was the worst (based on the investing emotions)I have had in my last seven year in the market. Even worst than that during the 2000 market crash time.
Monday I was again at the client site. By the end of business Monday market was 10747, but I was down $350 because my deadline (July 21st) was 4 days and fast approaching. Unless market goes above 10850, I will be in red on Friday evening. I held on for another day.
Tuesday was great, oil uncertainty was dying down and market close 10799 and I was in black. I made some stop loss orders and waited for another day. Wednesday afternoon I chekced hoping that my triggers woudl have materialized, instead market was way up due to Fed's comments. My original investment was worth $3200. Like any conservative (For the first time you hear the word conservative in these two posts!!!), I sold 5 options for $1600 and put a stop loss order at $1400.
For the first time I too a sigh of relief. I have made $70+ ($100 - trading cost) profit in 3 days and have a potential to make another $1400. By the end of the day, my other $1400 was filled and I made about $1450 on an initial investment of $1500.
I would let you take your own views on this experience, but personally I liked the ride..... and not just because I made money
2 comments:
i made my first investment in march this year. buoyed by some profits i decided to invest much more on stocks and funds. i chose the option of investing in riskier stocks and funds. looked into stocks and funds with most aggressive growth in the past year and invested in excess of 10K in them. however the market took turn for the spin down after may and by october i was losing 25% of my investments. however market being market turned around again and so far i am losing only 7%. with this rate i am optimistic of making some profits early next year. currently i am selling off the bought stocks and funds as soon as they break even. then i plan to peruse about better investment options and try to invest more wisely and less impulsively in future. most of my currentstocks are mutual funds are from renewable energy and international metal domain.
Moral of story: stock market = a big gambling casino. invest and keep fingers crossed and enjoy the ride.
A valid point raised. These kind of speculative investments are not to be made with retirement money or education money or money kept to buy your engagement ring. If you have extra cash that you can lose, go ahead and use this king of strategy.
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