[jpennybags]

Originally Posted by umfan92 »

Ok well after much back and forth, I ended up keeping the stock. It was going up the last time I posted here. I was hoping it would keep going up but it took a horrific downturn and is now at 5.08. Does anyone have any advice? I know this was stupid, but I guess I haven't learned yet.

You know… you're right… you haven't learned yet…

You entered a trade that you didn't understand, during a time in the market that you didn't understand. You also took a trade (that you didn't want) based on what you could afford, to experiment with some strategy that you didn't understand (obviously). You were told to exit the trade (which you didn't). You were told to hang on to the trade if you believed in your research (which you did do… although; I doubt that it was anything more than hope that kept you in).

If you want to experiment and throw money at the experience, I personally have no problem with that (for so many reasons)… it's a learning experience. The market is a tough place to make a buck, and getting your a** kicked is actually helpful in many regards. The number of times this happens before you start to catch on will dictate how long you remain.

You may consider that "the market" has handed you a raw deal, but nothing could be further from the truth. You've done this to yourself… understand this (in a meaningful way), and the battle is half over.

Every person (with some experience) who read your response knew what was going to happen: "you were going to follow this trade down"… everybody knew it. We all knew it because to one extent or another we have all been there. In life… "hope" is a good thing… it keeps us going from one day to the next. In the market… "hope" is not allowed… it either "is", or it "isn't".

As a trader, you need to come to the understanding, that once a trade goes against you… it's time to get out. Once the covered call strategy failed…"it's a failed trade"… no if, ands or buts… get out. Sprint (S) may catch a bid, and may rebound… who knows for sure. I have no advice as to what you should do now… it's your call (it always is). On the other hand, if you've entered the trade as a long term investor, and you believe in the story… certainly, hang on…with the understanding that there needs to be a limit to the pain.

One of the best trades I ever made, and one that has stuck with me through the years, was the first time that I had to "chew my leg off" to exit a trade. It hurts something awful, but once you are free… what a relief (generate some cash… live to fight another day).

Best of good fortunes going forward.

[Pony]

That's a little blunt, but he's absolutely right.

However, I think it's a good thing that you made this mistake. No one can make much money off of 548 dollars. Even if it went up 10% this month, that's only $54.80 with commissions of probably $20.00 round trip leaving you with a total profit of $34.80. That's not worth the stress that you seem to be going through. But this is why I say it's a good thing. You learned something didn't you? The worst thing that could happen to you is that you jumped into this and had success, because it would have been luck, and then you might risk more money next time, and really be in a pickle.

I assume you're between 18 and 21 because this sounds really familiar to me when I was in college and wanting some extra cash. However, if you really didn't need the money, which you shouldn't have if you put it in there. if you did need the money, you're in this for gambling, your state's scratch-off's would give you better odd's, anyway, if you really didn't need the money, then just leave it. In the long run it will eventually go up. Probably at the rate of about 7% a year or so, maybe you could move it to an IRA and get a tax right off for it. I want to say I got 20% discount on my taxes for my contributions to my IRA.

Summary: In an optimistic/realistic sense, this is a good thing. Hopefully you learned something. But I do say thank you, because I may try to swing trade this on the way down

[Pony]

Watch the stock tomorrow, looks like a morning doji star is forming, you might be in luck!

[Tams]

Originally Posted by Pony »

Watch the stock tomorrow, looks like a morning doji star is forming, you might be in luck!

your "analysis" is based on what you wish to see...
not seeing what the market is showing you.

[Pony]

I don't wish to see anything, just looked like a possibility to watch for if the there was a positive candle formation today. It of course didn't form, but if it did... Anyway, I think the only reason it went up at all was a "head and shoulder's" completing, which I had stated earlier. Would you agree with that? Not trying to act like I know anything, just trying to have my theories critiqued.

[tldwg04011]

umfan92, may i suggest another stock for you to research? Universal Insurance Holdings Inc. (UVE) is great fundamentally and nearly great technically. Additional plusses are it pays a dividend and has options coverage. In your situation I would buy 100 shares limit $4.60. Here is an article to get you started in your research. Good luck!

[mrcsidney]

I can't give you any golden advice because I don't believe in advice. The responsibility for your experience is yours. The only person you'll really listen to is yourself. And it seems your advice to yourself has been flawed. So. Please read the following several times in different moods and think about it.
Whatever you do, you must know how to plan. Are you a builder? Where is your plan?
Are you a student? What is your plan. Are you a doctor? You need to know how to proceed. Stop immediately! No, really, STOP and rethink what you are doing. I am the proud owner of several blown-out accounts so I can tell you that you are doing exactly what I have already done and it does not work. Perhaps you could read Jack Schwager's series of books about Market Wizards. ( read several times, it takes awhile to sink in ). The very best of good luck to you. I would love to read in time that you have become successful.