Revolutionizing My Returns

Good morning!  Good morning indeed…I just booked a 300% gain for the first time since I began trading.  I have been able to find a good amount of positions that double in value, but this is by far one of my favorite trades.

I can remember how it began like it was yesterday, it was early morning September 5th and I had a list of buys from my research the previous evening.  One of those positions was Molson Coors (TAP).  They had announced a 2 for 1 split and their charts were looking really good for some upward movement.  I bought 2 Jan 08 $90 calls for $1,075.  I had high hopes of doubling my investment and the next couple of weeks showed promise of achieving just that.

Then, last week, the stock split and it continued to inch up even though some shmuck came on CNBC one morning talking about how the beer stocks were all sells according to him because they were performing better than they ever have.  I was fuming.  There is nothing worse than a guy who badmouths good performance just because it makes no sense to them.  A warning, sure we can all appreciate that, but telling the world that nothing makes sense because you don’t believe in it really pisses me off.  I wasn’t mad for long though, because the guy was dead wrong; at least when it came to TAP.

Then yesterday I was sizing up my position to take the gains.  I was feeling like I might let it run a little more but worried about a sudden turn around (although I was no longer mad about it, I still had that jackass in the back of my mind making me worry).  To my surprise I woke up this morning to find that an announcement of a merger of operations was going to cause a big gap up in my position.  I decided to strike while the iron was hot!

I logged on and saw that my contracts were trading at 11.30 - last/ 11.80 bid/ 14.50 ask!  For a second my usual shark mentality (see this entry) kicked in and wanted to circle the waters, but I was happy to hear the game show contestant in me shouting “DEAL! DEAL!” as it hit the red button of my id.  The shark swam away and my position closed for a cool $4,752.  I walked around in circles for a couple of minutes, then wanted to wake my wife to tell her of the transaction…but she had a rough night with the boys waking her up and I let her sleep for another 15 minutes…nice guy that I am.

So that is it.  I am still reeling from it a bit, but I can already hear my subconscious talking about what it really represents: Let’s book more like that and let’s book one even bigger!

Trade Well.