Wednesday, November 17, 2021

>> LEG INTO TRADES (investments) like I TRY to do

WORDS OF WISDOM whether trading stocks or options

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Hi Everyone!
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HOLDING BACK MONEY just in case your trade idea goes against you

Legging into trades means the same ... you don't take a FULL BITE up front rather you 'leg' in 100 here, 100 there to see how the trade idea goes.

Recently I did a Cash Secured Put where I wanted 300 shares of a stock (MARA) but decided that I had better hold back some shares just in case the trade idea were to go against me ... so I decided to do 200 shares vs 300 shares

This turns out to be a good move as MARA is falling -6pts today.

By holding back the 100 shares ... it gives me an opportunity to take advantage if the stock were to fall ... allowing me to Dollar Cost Average.

With MARA falling another -$6 today that gives me an opportunity to slip in and use that extra 100 shares to do another  Cash Secured Put if I felt this was a good time ...

For me, I wanted to own 300 shares of MARA so this will allow me to have 300 shares but not at $55 where I did the 1st Cash Secured Put ... rather instead lower ...  probably around $52ish

Now where the stock goes from here I have no crystal ball ... but at least by holding back the 100 shares I am able to Dollar Cost Average down making it probable for me to obtain the shares and Write a Covered Call where my stock purchase price will be at or under my Covered Call Strike Price ... that would be the most optimal situation

I have done this now for 2 years on various stock entries and it seems to help ...

If I leg in for 200 and the trade goes well... the stock moves higher and I don't get the only 100 in the game ... its ok, I have good skin in the game, we move one.

MY WORDS OF WISDOM
I TRY to NEVER TAKE A FULL BITE!!! - timing the market is hard to do.

If I want 300 ... I do 100, 100, 100 
or 200, 100

Because sometimes ... it can REALLY go bad and by doing this I've saved my ASsss!

As always, do your due diligence and this is not a recommendation



Until next time, I wish you the very Best In Trading!
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Regards,
John
email me corepositiontrading@gmail.com
Remember, this content is for informational and educational purposes only. If you invest using information contained here, do so at your own risk. Please read the full disclaimer posted below and visit cptdashboard.com for my privacy policy.
Disclaimer - Yes - at the time of this posting I do own shares. I am by no means recommending this stock for purchase
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