Friday's Small Lots

I entered a position on MAC timed to coincide with an earnings announcement.

sym	shares	entry date	exit date	entry price per share	exit price per share	result $	result %	annual rate	days held	tactic
MAC	1	7/29/2016		89.76						earns

I exited seven positions, four profitably and three for  loss. The average gain was 2.0% over 1.29 days, or a 952% annual rate.

sym	shares	entry date	exit date	entry price per share	exit price per share	result $	result %	annual rate	days held	tactic
BCOV	5	7/28/2016	7/29/2016	9.68	10.99	1.31	11.92%	4351%	1	earns
CBS	1	7/28/2016	7/29/2016	53.69	52.36	-1.33	-2.54%	-927%	1	earns
HUN	3	7/26/2016	7/29/2016	15.94	15.01	-0.93	-6.20%	-754%	3	earns
INVA	4	7/28/2016	7/29/2016	11.79	12.81	1.02	7.96%	2906%	1	earns
NLNK	5	7/28/2016	7/29/2016	11.09	10.20	-0.89	-8.73%	-3185%	1	earns
OMCL	1	7/28/2016	7/29/2016	36.32	39.33	3.01	7.65%	2793%	1	earns
PFG	1	7/28/2016	7/29/2016	44.59	46.47	1.88	4.05%	1477%	1	earns

Here's how I handled the exits:

I raised the sell alert level up to one day's average true range, which triggered alerts on HUN and NLNK. I did this because the 5x ATR I was using is simply too insensitive to change. 

The goal of this strategy is to get outta Dodge quickly if the anticipated results don't occur. The trades happen in response for events that will produce an immediate result: Earnings announcements or trading signals. There's no point in hanging around if the immediate result isn't evident.

CBS didn't have an exit alert, but I closed it anyway based on the trend of the chart. 

And that may be the best way to do it. An uptrend is a higher high and higher low, and a downtrend is a lower high and lower low. If I'm doing trades for immediate results, then the trend of the chart alone shows what the results are without a need for ATRs or any other math.

-- Tim Bovee, Portland, Oregon, July 29, 2016

The Rise and Fall of Nations: Forces of Change in the Post-Crisis World by Ruchir Sharma

References

Tradecraft: Playing the odds to build winning stock market trades from options, a description of how I trade, can be read here.

Small Lots: A new strategy discusses the thinking behind the analysis that identified these trades and can be read here. The symbols noted in this post are intended fortrading on a commission-free platform such as Robinhood Financial.

I can be reached via comments on Private Trader posts or by email at datnillc@gmail.com.

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Disclaimer

Tim Bovee, Private Trader tracks the analysis and trades of a private trader for his own accounts. Nothing in this blog constitutes a recommendation to buy or sell stocks, options or any other financial instrument. The only purpose of this blog is to provide education and entertainment.

No trader is ever 100 percent successful in his or her trades. Trading in the stock and option markets is risky and uncertain. Each trader must make trading decision decisions for his or her own account, and take responsibility for the consequences.

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Based on a work at www.timbovee.com.Tss s ss'ss