How to view the entire chart:
1. Try clicking on the name of the most recent article in the column on the right. This will remove the "Archives" list.
2. Try right click on the chart itself and open it on a separate window.
I am sorry that I cannot always make the chart small enough to fit neatly on the left column. I want you to be able to see the details I want to point out.
I Hope this helps,
Juan
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The flexibility of the PCCRC continues to amaze me as I experiment with ways to take profit or reduce cost while staying in the trade.
This trade in HUM has not been described before in this series, but I thought I share with you what I did with it as I felt that the stock was hitting resistance created only days ago:
First, here is the 60 min chart on HUM, as you'd see, the high of just a few days ago may represent now resistance and the stock may pullback from it. This may be a temporary set back, but one never knows for sure.
I don't like to leave money on the table, but on the other hand, it is quite possible that HUM will continue to rally. Here is my compromise: I sold a portion of my long calls, reducing my cost significantly:
Should HUM continue down, my short calls will deteriorate while my long puts might gain some grown, compensating for the close of my long calls. If the stock continues to rally, I see that I could still make Delta gains.
Although Delta is negative, a good rally will bring profits still. Sure, the profits are not as much as those that could be achieved with the untouched position, but in this difficult markets, we are less and less greedy. The success of the PCCRC is in keeping the neutrality of the trade as much as possible.
5 comments:
Juan,
That was the sort of adjustment I was referring to in my previous Blog comment. These adjustments are definitely the key to improve the results of the trade.
Best Wishes.
Yes, indeed, the proper way to have handled the AAPL trade could have been by just selling some long calls and Delta-Neutralizing while taking profits in the action.
The difference between the two trades is the time to expiration of the longs. In the case of AAPL I have only a few days to expiration for the shorts, after which I would have had to buy Jan longs and sell the Oct longs anyway.
There is one more thing that affected my decision. This AAPL trade was in a cash account at OptionXpress. I am closing this account and transfer the funds to Interactive Brokers, where, as you know, they handle the PCCRC's more efficiently.
Juan,
RE: "I am closing this account and transfer the funds to Interactive Brokers, where, as you know, they handle the PCCRC's more efficiently."
Well that decision is a very good one to make.
Juan,
You have been mentioned on the Wall Street Community web page;
http://www.wallstraits.com/community/viewthread.php?fid=7&tid=2634
Juan's a popular guy now. Careful no one fades your trades eh.
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