My two open trades paid off huge since Friday, and I can only chalk it up to pure, dumb luck.
I closed both of them out just after the market opened today.
My Thursday trade on the QQQQs was sabotaged by the news over the weekend of the demise of Bear Stearns and the 1/4 point rate cut by the FED. The markets swooned on Monday morning, and took me way out of the money.
However, as I published in the BLOG yesterday morning, with blood in the financial streets, I took the plunge and waded in for 500 shares of Goldman Sach- GS- at $144.25- I didn’t publish this second trade as I was traveling, but I did pick up another 500 at $143.
It was not lucky to be in the position as it was my call, but it was pure dumb luck that GS was posting earnings pre open, and they blew away the numbers. I closed out both positions, choosing to be flat with my trading money going into the FED news today.
Net result: $21k profit on my GS trade, $1100 loss on QQQQ option trade, and happy to be out.
I am now content to be in cash with my trading money and wait for the next severe, knee jerk from the markets to make a trade by going the other way.
You know, it blows me away to see what power the market has to give over such a long period of time…and then…take away in an instant. Bear Stearns.
Nice trade. It serves as a reminder to me to buy when others are selling. Thanks.
Editor: Couldn’t help but think there would be a great buy in some brokerage firm with the market selling them off so dramatically on the heels of the bear news. The first 10 points was good planning. The second 10 points was luck on the earnings release. I could have made another 10 points if I had held through the FED announcement, but I wasn’t willing to do that. Could have gone the other way, and I could have given it back.