Our November SPY Iron Condor was filled at a debit
of $0.47 to flatten our position. This is a $0.12 loss from our
original fill at $0.35, resulting in a loss of 7.2%. Given this
extremely volatile market, we're glad to flatten out at a very small
loss without increasing the risk of the position. The market continues
to move in a sideways fashion, yielding very unpredictable price
movements. We will continue to watch the market but stand by our exit
according to our trading plan. We don't subscribe to the 'shoulda,
woulda, coulda' philosophy and are ready to start planning our next
trade! We will continue to practice our emotion-free, probability based
approach to trading and will issue our next trade in the near future.
As
this month marks our first realized loss, albeit small, it is important
to see why we strongly advise proper money management. Also remember,
our approach to the markets and trading is strictly based on
probabilities and statistics. While winning trades are always great,
realize that losses are a statistically guaranteed part of trading. It
is our job to keep our losses small and our winners large, all while
maintaining an emotionless state of mind - which can be very difficult
for novice and experienced traders alike! Trying to hold on to a losing
position and 'see if it will come back' is a very dangerous game to
play. You may luck out a few times, but this reinforces bad habits and
will definitely come back to bite you in the long run. Imagine taking
the maximum loss… Not a pretty picture by any means! The market is
always right. For those of you trading equities, futures, and other
index products, please keep in mind that today's action is on very
light volume. Be sure to pay attention as this bullish action may be
falsely optimistic in the midst of the credit / subprime / write-off
themes of late. While a slight rebound may materialize, the larger
macro themes still prevail in the markets.