Comments on: What Goes High Must Go Higher

By: Jonathan

Jonathan — Thu, 06 Mar 2008 01:54:09 +0000

Good to hear it worked out for you. Sounds like it was a great trade.

By: Eddie

Eddie — Thu, 06 Mar 2008 01:18:34 +0000

thanks for the vote of confidence last night. traded out for a 23% profit. Happy trading.

By: Jonathan

Jonathan — Wed, 05 Mar 2008 13:21:55 +0000

Hey Eddie,

I like PBR, I think it could easily bounce back to 125. What I don’t like is the fact that the market is moving in the opposite direction. That always complicates things for me. I’ve tried to go long several times in the past few weeks and I have gotten stopped out about 8 times out of 10.

By: eddie

eddie — Tue, 04 Mar 2008 23:42:43 +0000

Sorry when I said contracts, I was talking about options. But for our purposes I guess I just need to know were the stock of pbr is going. thanks

By: eddie

eddie — Tue, 04 Mar 2008 23:41:08 +0000

Actually im doing the april 115 calls. I usually trade options in place of the the common stock. thanks for the help.

By: Jonathan

Jonathan — Tue, 04 Mar 2008 23:32:00 +0000

Hi eddie. Are you talking about the stock PBR or something else. Can you give me symbol and a month if you’re talking futures. I’ll take a look. I won’t be back until later tonight…

By: eddie

eddie — Tue, 04 Mar 2008 22:58:01 +0000

Hey there. This post was on mind this morning. Before the bell I got long a few contracts of PBR. It just touched its 50dsma. I will scale into more call in the next coming day on any more weakness, and strong volume. Need some feed back thanks.

By: Jonathan

Jonathan — Tue, 04 Mar 2008 13:18:25 +0000

I kind of look at my capital in futures and stocks as one entity. As a percentage of my overall trading activities, I try to keep risk close to 1% to 2% of overall capital even for futures. My futures account is just smaller than the stock one.

Now that I think about it some more…it also depends on what pattern I’m trading. Some stops would require more than 4 or 5 times maintenance.

I’m not saying that a 4 to 5K account is entitled to trade one corn contract. What I am saying is that when I short 1 March Corn, I’ve already allocated 4 to 5K in losses, regardless of % risk on the trade. I think of the 4 or 5X margin as there to cover something “just in case”.

Thanks for the comment Bill. You insight is thought provoking as always!

By: Bill aka NO DooDahs!

Bill aka NO DooDahs! — Tue, 04 Mar 2008 11:55:39 +0000

4-5x maintenance margin equates to … what, about 3-4x leverage for most contracts and most brokers? That’s still an awful lot of leverage for somebody trading their **own** account.