Tuesday, November 16, 2010


The question I have to ask myself today is "Which is worse - taking my third loss out of 70+ trades so far in the DITM strategy, or getting a root canal?" Actually I did both, one leading to the other. Since the TLT was tanking and I had made the error of not selling a 10% ITM call, rather one that was right at technical support, as well as "insured" by Uncle Ben's QEII, I had to put a stop on it since I was in the dentist chair at 7:30 a.m. Tuesday, and all market reversals really looked cascading the last couple days, including the Calif. Muni Bond funds I so dearly love - NCA,NCP, TFI, MUC, etc. Luckily I hedged the TLT with the Ultra (2X) TBT and got 1/3 of the loss repealed:
Bot 300 TLT at $102 - $30,650
sold 3 Mar. 98 calls for $1650 (bot back at $520)
got 1 dividend - $100
closed out TLT at $28250, whereupon it bounced back immediately whilst being drilled on.
Net on the TBT -$375, also stopped out at open.

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