mode7 (93.07)

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Time to Sit the Bench?

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September 02, 2009 – Comments (3) | RELATED TICKERS: CEP , EXM , PDS

Ok, this is only because I've never short sold before or played options.That and even if I was an experienced short seller I still think it's a better option to sit out in this market than to try short selling. It's just too unpredictable. Options though, those could be interesting. I'll have to research them more.

The question is, is it the time to sit out for a bit? I mean 50% is a lot from March. Any higher and we'll be in unprecedented territory.

I ended up cutting both CEP and EXM from my porfolio, so I suppose if the market is a swimming pool, I'm just non-chalantly lounging on the side with a few toes in the water. Last time I did this I just lost out, but then again, I really was surprised when the market hit 9500, something I didn't expect at least for another three months or so.

We'll see how the week goes, but I think if the markets do start to dip, I might be tempted to pick up some old favorites at a discount.

As for old favorites, I'm thinking HTE, PDS, PWE, PGH, AA, etc. CHK has been getting high marks as well. If things get back to their first week of July prices, it could create a very good market situation. I was jittery in July, when I would've done well not to be.

I'll cull through all my comments as well and do the research on any recommendations there as well.

To me it's more fun findings pick and doing research than actually sitting on stocks.

3 Comments – Post Your Own

#1) On September 02, 2009 at 10:52 AM, IBDvalueinvestin (99.49) wrote:

I am sitting on the bench with you, can't get hurt on the bench.

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#2) On September 02, 2009 at 11:14 AM, FreeTruth (< 20) wrote:

Certainly check out options! Market volitility is finally back and this is when you want to purchase and more importantly sell options. For example, the September FNM $1 Put was (and still is) ripe for the picking. I picked up multiple contracts for $5 dollars each and as FNM moves back to below a $1 where it belongs, my return is enourmous! Also, if you own lots (or 100 shares or more), selling covered calls is an excellent way to increase ROI. For instance, I picked up DAL a while back and sold covered calls Sep $7.50 for 0.50 (or 50 bucks a contract, that is the premium). Reviewing the charts, it was clear that 7.50 was resistance for DAL and it wasn't going to move above that for long, if at all and Maximum Pain was also 7.50. I'll end up pocketing the entire premium when the contacts expire on 9/19. You're missing an entire aspect of investing if you are not using options.

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#3) On September 02, 2009 at 4:37 PM, caterpillar10 (67.80) wrote:

I've had a big sell-a-thon a goin'on:-) already made it - why lose it now.

Open an option acct. w/ a real options broker like OX, for example. You want a simulator that works like the real market or close as it gets and 'paper trade' the do-do out of them b4 real $ goes in.

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