A Drink for Lost Opportunities
Sometimes I wish I had just placed my money where my mouth was.
So let me open up a beer and pour it in the name of ‘lost opportunities’.
In the post before this one, the Dow Jones was over 100 points. I told you it was overbought and should move down.
Here we are 60 points later. And the Dow Jones is only up about 44 points. The Dow actually dropped further then that.
You may wonder how the heck I could’ve played that move.
Simple. By buying puts on the Diamond ETF (DIA). The Diamond tracks the Dow Jones. So if you expect the Dow to drop, play the Diamonds.
By buying a slightly out of the money, front-month put option, I would’ve banked a nice 12% move in just a couple hours. The one I was looking at in particular was the June 123 Put.
If anyone has any questions – feel free to ask!
I have learned the hard way in the last few months of trading that the worst thing you can do is think about what you lost. I was focusing on a couple big gains I missed out on and out of panic got back in…..at the top. My stop-losses kept me from gettting wiped out, but I certainly did not make any profit.