Michael,
I don't really know what repair stratgies could be applied to a stock like (EDS) which closed at 32 1/2 and fell -$ 9 1/2 - trading 28 M shares, other than what I did, thanks to Richard and Andy - placing a sell order before open. Look at it this way, I gained .50 on each share. No more bottom fishing prior to earnings releases, for me.
Now, if you want to look forward and talk about protection, here is what was suggested to me. Don't set your goals on making 15%-25%, look for 50%-100% moves- in time. I have, looking forward, a feeling that AMD may double from its present level within a years time. This may or may not happen. I feel that AMD has a product that could make this happen and so this is 1/2 of my holdings.
What I was told to do was to buy some short-term puts say May to cover any down turn of AMD - protecting me for any immediate surprises. I was also told to go out - over a years time and buy Jan 99 calls which could be sold anytime but gives me time for AMD's stock to climb to a higher level.
As far as the stock holdings, I plan on being fully invested, following the indicators and trade signals I get. If I am to go from long to short, I can do that with one order to Datek. My immediate problem is to establish support and resistance levels for the stock and work them to (hopefully) my advantage. Personally, in time, I am sure this stock will do well, the only thing I have to be careful of is: what will its new low price be? If this market turn sour, which it easily could, I just want to make sure I have a short position and I should be ok.
Oh well, time will tell,
Rob |
