The other day I had to make an adjustment to my holdings in the Fusion account. My put insurance was running out of time and I needed to renew the policy. In the process of rolling the put, I took some time to reflect on what had happened to the position over the last year.
Initially, I was very disappointed because I did not have a profit in the position after holding it for more than a year. But on further reflection, I observed that HPQ declined 17% in February of 2018, recovered and declined 16% in March of 2018, rose 26% from April to October of 2018, and finally declined 19% during the correction we are presently experiencing. During all that volatility the position was never at risk for more than a 1-2%.
During that time, I could have exited the positions for a 10% plus profit if I only had a crystal ball on the coming decline. So, in summary, I was always able to sleep at night knowing my position was safe and avoided the concerns during some volatile action. I rolled my put out in time, hoping to time my exit better in the future.
I'm Kurt Frankenberg, and I have discovered how to truly put the odds on the side on the individual investor.