Close short position for QQQQ
After my 2nd short of QQQQ, it went up again. So I decided to short another 300 shares.
During that period of time, QQQQ gave out dividends. Although the dividend amount is not big, but that is additional cost I have to consider.
After 1.5 to 2 months since my first short of QQQQ, it went down below 50. I covered all my 600 shares eventually.
Lessons learned from this transaction:
- Setup goals before trading. What happens if it goes up? What happens if it goes down? For this case, if it goes up, I will short more. If it goes down, then I cover my shares.
- Patience. After the goal is set, execute the plan accordingly. And if nothing happens, be patient and wait. It is not easy sometime as I see the price went up. Remain patient and keep confident in myself really helps.
- Once you set the target price, do not change it often. That target price is set when you decide to enter the transaction. If the target price changes often, then it means no concrete plan exists beforehand.
OK, today my saved order bought me 50 shares of QQQQ at 49.5. Now I need to wait until it goes up to 55. Or I just keep on buying more???
As one of reading said, if you open the newspaper, everything you read is bad news. Credit crunch, high oil price, softening housing market, etc. Everyone is aware of the bad situation. But that normally means it is the exact time to buy into stocks. So QQQQ is just a start in this direction. :-)
Let's wait and see.
Followup about the short
After my first ever short QQQQ, it went up 4~5%. I decided to stick to my original strategy. So I shorted another 200 shares of QQQQ.
After that, the market keeps going up. I am little bit worried.
Lessons learned:
- Short shares include dividend as well. That means if the stock gives dividend, then I have to cover that.
- A clear exit strategy is always required before opening any position.
If it goes up another 4~5%, I will short more shares.
If it goes down to my target(50.00), I will cover all my positions and complete this round.
We will see.
First day after a short sell
Today I woke up a little bit earlier than usual. I want to take a look at market before leaving home. DOW+100 and NASDAQ+30. Suddenly I am not too sure about short sell QQQQ anymore. Meanwhile, I am telling myself to be patient. Since I already place an order to buy QQQQ back if it ever reached 55.
Give it more time, I am pretty sure it will go down in a week or two. But the question is: At what level should I buy it back and close the position? 47? 45? It looks like 47 is a bottom and it should have quite some support. So if it dropped to 47 I will buy back and buy some more... :-)
Let's wait for tomorrow then...
investment etc.
Today I resume my posting using this blog site. I will use it mainly track my investment and business related ideas.
This is going to track my investment related performance and ideas. So years later when I come back and revisit these, I can better understand my success and failure in this area.
Same thing applies to the business ideas and activities.
Recently the stock market is very active. It is really like a roller coaster. Today I short sell 100 shares of QQQQ at 49.93 after it arised more than 1 point. The theory is that the market is going to fluctuate within a range for quite some time. If it goes up, sell it and get it back when it is lower. I have applied the same theory in my 401K market. So it should play out well.
Today the Fed cut interest rate by 0.5%, that is a surprise for many people. The stock also shot up more than 300 points. I think tomorrow and the rest of this week, after the investors wake up and digest the news, the market should go down from here a bit.
Let's track it and see whether I am right about this or not.
Weblog re-visited
Today is Sep 30 2004, Thursday.
Right now it is 3AM in the early morning. I have quite a lot of work to finish at work, but I am triggered to take a look at this weblog website and start my own weblogging.
So many things happened recently, I think it is a good idea to write down some of my thoughts.
All a sudden I fall in love in Weblogging.
