Almost forgotten to blog about the position which I closed last Friday, June-15th, on NVIDIA Corporation (Nasdaq: NVDA, stock) which I entered back in Feb 13th, 2007, just before the earning announcement.
Looking at the chart you can see how the stock took the plunge and decided to stay below $34 per share for the next two months. Should you invest and long this stock by trading its option, you would suffer huge losses if you do not have the time-value on your side. Looking at the date of the closing position, you can see that I actually waited till the expiration Friday, squeezing every drop of the juice out of it. Am I lucky on this trade? You bet, besides analysis together with strong fundamental, you need all the lucks you can get hold of if you want your trades to turn profitable. 
But the most important factor in such trades is the value of fundamentals and if you’ve investing in such stocks, chances are your trades will return the favor by making good, if not excellent money for you. Also, study the price-action and you’ll be on your way to a better profitable trades. But again, investing stocks are always risky and if you can’t move on with your life after losses, you better think twice before pumping in your hard-earned money. Anyway, this is not a trade which I can be proud of.
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June 18th, 2007 by financetwitter
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Comments
you’ve done the correct thing by testing out without actually using your own hard-earned money tommy …
hope you can get some pocket money learning the art of investing …
cheers …
Hi Stocktube, i would like to pose one question: how do u derive the 57% profit? I am not an expert in math but isnt 40-28 =12 and 12/28 = 43% the most???
Regards.
hello anonymous,
hmmm … where did you get the 40-28 figure?
how i calculated was:
bought NVDA June 32.5 Call at $4.50
sold NVDA June 32.5 Call at $7.10
the difference is $2.60 (7.1 – 4.50)
so, $2.60 / $4.50 x 100 = 57.77%
my profit is $2.60 from initial cost of $4.50 … hence the calculation …
cheers
hi there,
Using pattern analysis, you can actually see the double bottom formed between mid march and early april.
The breakout in the middle of april at 31 something would be a safer position to take, if you also follow technical analysis.
Got it from here.
hello bobby … agreed provided the market pulse is positive … if only you know the chart will perform as what you see today …
end of apr and early of may could give you a constipation period …
cheers
Yes, I agree. Investing indeed is risky. I have only been creating fake portfolio using some online tools to test out my ideas on investing in stocks market. Your site definitely is a great site for me to refer for tips and tricks.
Cheers.