Bearish PCCRC

Now that we are probably entering a bear market (Major indices falling below the 200dMA). it would be interesting to examine the question: what if we cannot find stock jumping 10% after earnings?

In one of my DVD's, I have shown how to use the Elliott Wave principle (without software, just pattern recognition), to select stocks making important tops. It is easy to buy puts, but I have to admit that my record with such bearish trades could be better. I have tested the use of bearish PCCRC's in such scenarios: I opened a paper trading account about in late July and entered 5 of these positions. With a $100,000 paper money to trade with, I have already made almost $11,000 in fictitious money (that is 11% return) in just 3 weeks.

I am sharing these trades with you. If you have platinum, it would be easy for you to see the progress in these trades, from their entry.


Click on Image to enlarge it.

Note than in all cases, there was a limited risk and an unlimited potential profit. Although the trades are all entered at a debit, there is a cash requirement because I am buying OTM calls and selling ATM calls. The difference between the two, makes a portion of the trade a credit spread in the eyes of the broker, thus there is a cash requirement. For us, in practical terms, a cash requirement is a debit because some capital is tighed up for the duration of the trade. To view the cash requirement, all you need to do is go to the Monitor tab in the ThinkorSwim platform and view the column labeled "BP EFFECT". This is the cash required. Here you can also see the P/L OPEN (profit or loss from the opening) of each leg of each trade.



Click on Image to enlarge it.
Please examine each trade carefully. If you have not yet ordered my DVD's, please inquire by sending me an e-mail to paperprofit1@gmail.com. The cost is really small, compared to other Options courses out there. You could also be invited to participate in my private blog, were I continue to post videos on an almost daily basis.