Monday, May 3, 2010

Quick and Cheap Trade of the Day

I had a few minutes to watch the market this morning and I noticed one stock fluctuating lower. I decided to jump in the trade for a few minutes and shorted 100 shares. I didn't have big confidence on its ultimate direction but it was trending lower in the short term.

Once I'm in, I can see the profit/loss columns changing numbers like a video game. Withing a few seconds I'm 2 bucks up in the profit zone, and the price continues to fluctuate. At the peak, I was about $25 up, the it started tracking back up. Not sure of where it was going, I decided to jump back out.

Total profit: $9.09

Total time in trade: 5 minutes

Converted to an hourly rate: $109.08/hr

Or course that hourly rate isn't realistic as there is no guarantee one can keep that average up.

Any profit is a good profit I always say, but the bad news is I missed the entry on another stock I was watching that exploded upwards of 2+ points shortly afterward. The stock did a strange whipsaw where it looked like it was going to tank so I hesitated in pulling the trigger but then it suddenly reversed with a strong move upwards. I never like to chase a stock so it was too late for me to get in at that point for a short term play.

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