Lessons Learned up to Sept 16 2016
- I should have sold BAC and AIG LEAPS 2017 and Warrants on Aug 30 ~ Sept 09 when BAC is around $16.
- I should have bought VIX during the same time period as that of 1.
If I have done the above, I probably will recover all my loss this year and will be in a much better position. Remember to do it fast and decisively next time.
The reasons that I have not done what I should have done are,
- I was on a business trip from 09/02~09/05, I kept checking the BAC and AIG prices. I speculated that by 09/05, BAC price will jump due to the comments from Hawking Fed members, and it did as I expected. However, when BAC priced jumped to 10% in the early morning, due to the market minor crash (-2.5%), eventually in the afternoon, BAC price also dropped. I did not have chance to sell it.
- I have a bad habit to only do trading in my private office, this is not good. I need to learn to be more adaptive, decisive. Get my horse ready for the battle any time.
- My BAC and AIG were in-the-money, any subtle changes on the stock price will significantly affect my options price, so I was very hesitate to sell, in addition, I was too greedy on the return (always over optimistic), and ignored the upcoming risks. In addition, I forgot that after I sell them (1) I can buy them back because the foreseen volatility (2) I can switch to other better positions.
