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Old 12-02-2016, 04:15 PM   #1
MyrnaFTW
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Help me with my Trade Exits.

i will start this, by saying, that my ability to find good spots (especially on the short side) , is amazing. I feel i have a gift for spotting co's that are going to make runs in the direction i want . i will also say that i have beaten the stock market for over 4 million (easily) , in the 12+ years I have traded it. I have never worked at a hedge fund or traded for one that specialized in trading. Have just traded my money and for family/clients . my problem has been with exits , my ideas are good, and I would like to think my entries are good, but my exits are leaving a lot to be desired.. some examples.. 3 weeks ago i bought HD 129 puts , saw them appreciate 300%, only to lose all the gains plus the principal.. rinse repeat for the past year. A lot of times i feel like a trader's biggest leak is taking profits too fast, but now i'm on the other spectrum of it..
so basically this,, as a thread, help me out with my exit prices and I will tell you my entry prices for my plays. i usually short/buy puts , so it will be geared that way .. these are my current positions across all the accounts i control along with entry points.

HLF short stock since low 60's (late september)
HLF 12/16 49.5 puts , (1.45 avg price)
KIRK stock since 11/20 or so (13.80) price
NVDA stock since early may (36) , in retirement accounts.
TBT 40.5 calls that expire today , had a chance to sell them for 2 yesterday, (.74)
WTW short (9.85) (a monht or so) , was down a good % on that




All input/opinions and suggestions welcomed.

Last edited by MyrnaFTW; 12-02-2016 at 04:44 PM. Reason: duh spelling
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Old 12-02-2016, 04:20 PM   #2
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Re: Help me with my Trade Exits.

i will also add, that i believe that HLF is worth less than half of what its trading for, but i also know that icahn can really screw me on this..

NVDA i feel i can hold in the retirement accounts , it would offset all my usualy short bias anyway, same with kirk.
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Old 12-02-2016, 04:35 PM   #3
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Re: Help me with my Trade Exits.

got out of the TBT calls, @ .98 avg , which in reflection is ok, considering i got in at .72 , but could have easily gotten 2+ yesterday.
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Old 12-02-2016, 05:55 PM   #4
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Re: Help me with my Trade Exits.

Maybe you just need to set target exit points. For example, handicap what you think it should be or when you want to exit in view of having something possibly better than what you would have had from holding, then exit a set x% when that target hits and then rehandicap what you think it should be if necessary.

Even if you think there is EV to be had by holding, sometimes it's not necessary to squeeze the last 10% or so if you have something better. A win is a win, in many cases there is no need to win harder than what you were aiming for unless it's a very clear situation that your target was an underestimate.

One example I had recently was NTT. I had a target exit point at $35, because I thought the intrinsic value was $45, but at that point it would be 2-4 years to reach from $35 to $45 so 30% gain over 2-4 years was not as attractive as if I held something else, so I exited at $35.

It's at $40 now, but I don't really care because I think my current longs will yield something better (they did). If I didn't have anything better, of course I would've kept some of my NTT holdings, but since I was committed to exiting at least 50% once I hit my target to claim my win, I could rehandicap the situation from then.

Also my recent exit of PRSC for ACW was along similar lines, though I kinda luckboxed out on that one. I am probably going to rebuy in PRSC sometime soon.
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Old 12-03-2016, 09:57 AM   #5
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Re: Help me with my Trade Exits.

Hey Myrna,

Did you ever do a post-mortem on HD? You had a nice thesis on slumping retail when it came to Home Depot, and you basically got Trumped.

This is HD vs the Home Builders ETF:



You know where in there the election hit. Up 300% on a time sensitive investment with the election about to hit, it's worth settling the trade to me. Even without having any sense of what infrastructure/construction plays would do in a Trump environment, it's enough of a binary for me to lock in 300%. So when it comes to picking exits for your winners, what if you started listing the biggest vulnerabilities your trades have?
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Old 12-03-2016, 01:34 PM   #6
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Re: Help me with my Trade Exits.

I am a short term trader so my advice may not apply as well for longer holdings. I think you have 2 good options .

One. You could just use a sort of mechanical scale out approach once you have started realizing real gains. I think you should always do this with options since the clock to expiration day is always running. Option gains can evaporate in the blink of an eye.

Two. This is the approach I use. Use a technical stop out point. I use donchian channels but you could also use a moving average. Something that tells you that the momentum and trend has shifted.
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Old 12-04-2016, 05:58 AM   #7
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Re: Help me with my Trade Exits.

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Originally Posted by mrbaseball View Post
I am a short term trader so my advice may not apply as well for longer holdings. I think you have 2 good options .

One. You could just use a sort of mechanical scale out approach once you have started realizing real gains. I think you should always do this with options since the clock to expiration day is always running. Option gains can evaporate in the blink of an eye.

Two. This is the approach I use. Use a technical stop out point. I use donchian channels but you could also use a moving average. Something that tells you that the momentum and trend has shifted.
A pretty successful trader I know uses both of these, after a fashion. He legs out with trailing stops that are set at Fib points. For example, say you're in a 3k position. Set a trailing stop to take you out of 1k shares at a point determine by Fib points, then set a higher profit target with a trailing stop for another 1k shares. The final 1k you get out of at the profit target you originally figured for the trade when you started.

There are lots of books and articles on trade exits. You should be able to find something that you like.
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Old 12-04-2016, 11:46 PM   #8
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Re: Help me with my Trade Exits.

Sometimes it helps to take some off early. I frequently take off like 1/10 or 1/8 when I get a move just to take off some pressure. It probably doesn't makes any real difference in terms of pnl, but it psychologically makes things easier.

I feel like holding winners helps nearly every strategy, from my swings to even my shorter term scalps. Sometimes you give a lot of open profit back, but that's just part of trading. No one is a trading genius who can pick perfect entries and exits.
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Old 12-05-2016, 11:22 AM   #9
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Re: Help me with my Trade Exits.

Quote:
Originally Posted by Mori****a System View Post
Maybe you just need to set target exit points. For example, handicap what you think it should be or when you want to exit in view of having something possibly better than what you would have had from holding, then exit a set x% when that target hits and then rehandicap what you think it should be if necessary.

Even if you think there is EV to be had by holding, sometimes it's not necessary to squeeze the last 10% or so if you have something better. A win is a win, in many cases there is no need to win harder than what you were aiming for unless it's a very clear situation that your target was an underestimate.

One example I had recently was NTT. I had a target exit point at $35, because I thought the intrinsic value was $45, but at that point it would be 2-4 years to reach from $35 to $45 so 30% gain over 2-4 years was not as attractive as if I held something else, so I exited at $35.

It's at $40 now, but I don't really care because I think my current longs will yield something better (they did). If I didn't have anything better, of course I would've kept some of my NTT holdings, but since I was committed to exiting at least 50% once I hit my target to claim my win, I could rehandicap the situation from then.

Also my recent exit of PRSC for ACW was along similar lines, though I kinda luckboxed out on that one. I am probably going to rebuy in PRSC sometime soon.

Yes, a good scale out method , would probably make sense, Its about me implementing it.

Ill give you guys a real world example though.. HLF , I have been short since the low 60,s on a good amount of shares, personally I feel its a 20 dollar stock, but I do have a 12 point or so gain right now, should i take profits? one of my clients wants to hold because A. he also agrees with me its a turd and B. for tax reasons, he would rather wait til after january 1st to take the gain, as he has enough capital gains for 2016 to worry about .

So what would be the optimal play here?
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Old 12-05-2016, 11:23 AM   #10
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Re: Help me with my Trade Exits.

Quote:
Originally Posted by mrbaseball View Post
I am a short term trader so my advice may not apply as well for longer holdings. I think you have 2 good options .

One. You could just use a sort of mechanical scale out approach once you have started realizing real gains. I think you should always do this with options since the clock to expiration day is always running. Option gains can evaporate in the blink of an eye.

Two. This is the approach I use. Use a technical stop out point. I use donchian channels but you could also use a moving average. Something that tells you that the momentum and trend has shifted.
yes, that's what i plan to implement, i notice that us as traders, always plan to scale out, but almost never do,, we start our initial scale out , and 20 minutes later we are spooked out of our rest..
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Old 12-05-2016, 11:25 AM   #11
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Re: Help me with my Trade Exits.

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Originally Posted by MyrnaFTW View Post
Yes, a good scale out method , would probably make sense, Its about me implementing it.

Ill give you guys a real world example though.. HLF , I have been short since the low 60,s on a good amount of shares, personally I feel its a 20 dollar stock, but I do have a 12 point or so gain right now, should i take profits? one of my clients wants to hold because A. he also agrees with me its a turd and B. for tax reasons, he would rather wait til after january 1st to take the gain, as he has enough capital gains for 2016 to worry about .

So what would be the optimal play here?
If you are worried about taxes for 2016 you could do some sort of 2017 option to lock in gains now and defer the tax bite to 2017.
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Old 12-05-2016, 11:26 AM   #12
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Re: Help me with my Trade Exits.

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Yes, a good scale out method , would probably make sense, Its about me implementing it.

Ill give you guys a real world example though.. HLF , I have been short since the low 60,s on a good amount of shares, personally I feel its a 20 dollar stock, but I do have a 12 point or so gain right now, should i take profits? one of my clients wants to hold because A. he also agrees with me its a turd and B. for tax reasons, he would rather wait til after january 1st to take the gain, as he has enough capital gains for 2016 to worry about .

So what would be the optimal play here?


What you feel it is personally and what the market feels it is are not the same thing. Burry had to endure that for a long time before it aligned. With options you don't have that time. So maybe it's better to see what the market thinks it might be worth.
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Old 12-05-2016, 11:36 AM   #13
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Re: Help me with my Trade Exits.

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Sometimes it helps to take some off early. I frequently take off like 1/10 or 1/8 when I get a move just to take off some pressure. It probably doesn't makes any real difference in terms of pnl, but it psychologically makes things easier.

I feel like holding winners helps nearly every strategy, from my swings to even my shorter term scalps. Sometimes you give a lot of open profit back, but that's just part of trading. No one is a trading genius who can pick perfect entries and exits.
Yeah, psychology is such a huge factor in trading, maybe booking wins on a small % of the position will help out with the next plays..



Rafiki,

HD, i slept at the wheel, I had a put position i started right before the ER , @ around 1.8 , i saw it worth to 6+ on intrinsic value , and saw the combination of Goldman upgrade, new housing starts number, and jim cramer pumping it for me to lose everything as the puts expired worthless,

i had a good 20 minute window when the housing report to get out at profit and I did not take it..
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Old 12-05-2016, 02:17 PM   #14
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Re: Help me with my Trade Exits.

so Started a smallish position,, its a pre earnings play, but I would probably short post earnings as well most likely


AZO stock short at 780 and azo 12/16 780 puts @ 16.80


im expecting them to actually beat but sell off, which is why im ok with shorting more at the open.
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Old 12-06-2016, 03:16 AM   #15
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Re: Help me with my Trade Exits.

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i will also say that i have beaten the stock market for over 4 million (easily) , in the 12+ years I have traded it.
Unless you're new to options, I find it hard to believe that someone trading for 12+ years with big size doesn't have a clue about options, e.g. asking whether an option was mispriced, or falsely recalling a moment where call-put parity was violated.

I hope you aren't looking for "clients" on 2p2.
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Old 12-06-2016, 08:35 AM   #16
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Re: Help me with my Trade Exits.

Myrna is cool, he's never done that
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Old 12-06-2016, 10:51 AM   #17
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Re: Help me with my Trade Exits.

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Originally Posted by :::grimReaper::: View Post
Unless you're new to options, I find it hard to believe that someone trading for 12+ years with big size doesn't have a clue about options, e.g. asking whether an option was mispriced, or falsely recalling a moment where call-put parity was violated.

I hope you aren't looking for "clients" on 2p2.
grim,, you honestly wouldnt understand what i was talking about , or see why its mispriced. I have never actively looked for clients, and i dont think i ever will or need to. ive been on 2+2 trading for 3+ years .

avged down on my azo puts @ 10.70 and the stock at 782 ,
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Old 12-06-2016, 04:23 PM   #18
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Re: Help me with my Trade Exits.

Sell pieces for freerolls
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Old 12-06-2016, 04:47 PM   #19
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Re: Help me with my Trade Exits.

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grim,, you honestly wouldnt understand what i was talking about , or see why its mispriced. I have never actively looked for clients, and i dont think i ever will or need to. ive been on 2+2 trading for 3+ years .
Please spare me the "I wouldn't understand" bull****. You don't know anything about option pricing, and anyone who can't see that is a options fish as well. This one takes the cake:

Quote:
Originally Posted by MyrnaFTW View Post
I understand that it seems like I simplified the question , but there have been situations where I believe the pricing model was wrong. If I recall correctly. The 32.5 calls were reading at 50 cents with tbt at 33.05 ,the day before a major announcement.
And for record, I have no problem with people asking questions, no matter how basic, but it raises eyebrows when they make grandiose claims.

Anyway, I'll stop derailing now
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Old 12-06-2016, 11:11 PM   #20
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Re: Help me with my Trade Exits.

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Please spare me the "I wouldn't understand" bull****. You don't know anything about option pricing, and anyone who can't see that is a options fish as well. This one takes the cake:



And for record, I have no problem with people asking questions, no matter how basic, but it raises eyebrows when they make grandiose claims.

Anyway, I'll stop derailing now
Myrna is a fish; fading him is free money!
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Old 12-07-2016, 07:57 AM   #21
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Re: Help me with my Trade Exits.

Puts on Myrna
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Old 12-07-2016, 08:24 AM   #22
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Re: Help me with my Trade Exits.

Myrna,
It seems you mostly got schlonged by Trump. Had the market tanked on a Trump win, you probably would have done well.
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Old 12-13-2016, 09:13 PM   #23
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Re: Help me with my Trade Exits.

Myrna, the only way to eliminate the psych stuff is to trade mechanically. Do not allow yourself to vary even if it is a Tuesday or your period is about to start or Carl said something on CNBC.

You set trailing stop loss limits (or whatever exit strategy) and you stick to them no matter what. Never vary from your exit plan even if it makes you puke.

There is absolutely no reason at all for psych to get in the way of a decent exit strategy.
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Old 12-14-2016, 09:12 PM   #24
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Re: Help me with my Trade Exits.

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Myrna,
It seems you mostly got schlonged by Trump. Had the market tanked on a Trump win, you probably would have done well.
I was expecting down as well. Maybe it is just taking longer (to begin) than everyone thought?
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Old 12-14-2016, 09:12 PM   #25
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Re: Help me with my Trade Exits.

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Originally Posted by BrianTheMick2 View Post
Myrna, the only way to eliminate the psych stuff is to trade mechanically. Do not allow yourself to vary even if it is a Tuesday or your period is about to start or Carl said something on CNBC.

You set trailing stop loss limits (or whatever exit strategy) and you stick to them no matter what. Never vary from your exit plan even if it makes you puke.

There is absolutely no reason at all for psych to get in the way of a decent exit strategy.
What's this, a good post?
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