Thursday, June 07, 2007

 

Bad trading

Still holding RIG. Went back to my bad old trading habits of not respecting my stop losses. I always had the "this is an energy stock, it will bounce up" thought in the back of my mind. That's a no-no.
When it comes to options, you need to be even more disciplined as compared to stocks. In this case, although the stock was down 'only' 2.7%, the option that I was holding went down 10 times that (since my avg cost was 10).

Anyway, I'll be getting out of this if the markets are down tomorrow as well.

Lesson: Respect stop-loss. You can always get back into the trade if it goes higher.

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