Green shoots are just sprouting everywhere aren’t they?
Don’t be alarmed that we are making little progress in our header- we’re only adding in theprofits as weclose positions from our April 10th start withour virtual$100,000. We arenot including profits fromthe positions still working because:IT ISN’T REALLY A PROFIT UNTIL YOU CASH IT OUT… OK then, week 7 of this Frankenstein project that started off as just how to BUILD ahedged portfolio but has now ended up as a ton of positions I have totrack. Oh well, it’s a great exercise and it makes money too so let’s enjoy the ride.
The primary goal of this portfolio is to be conservatively hedged. The secondary goal of this portfolio is not to mess around with it. These are meant to be nice safe(ish) positions that do not require you to sit glued to a monitor all day. Our last review was back on May 25th so once in 8 days isn’t too demanding I hope. If you are new, please read the last update as there was much wisdom in there. This week is just a quick review and a check on how our new positions are doing.
We have still deployed only 1/3 of our capital and we will see tomorrow whether we wereTOO patient waiting for a pullback that hasn’t come these last 10 days as theDow has gone from 8,469 to 8,200 and now all the way up to 8,740. So we missed a big dip by waiting on our entry but our lack of faith in 8,200 holding up made us miss a 5% move up. Is there a lesson to be learned here? No – there’s no way to time things perfectly and you have to enter where you feel comfortable and confident. It’s hard enough hanging onto thing when you really believe in your entries and targets, if you enter when you are not certain then you are certain to have a disaster at some point…
Also, a good thing to do is open the older post in another window and see the beauty of doing nothing! As I mentioned we have gone up and down 250 points in either direction and, by doing nothing at all about it, we have made nice little advances in most of our hedged positions as the premiums of our callers erodes overjust 8 of the 37 days they had to expiration.