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Posted On: 10/15/2020 11:09:31 AM
Post# of 154120
Quote:
as for derisking a position, I'm personally of the belief that the only way to derisk a position is to own less of it (or hedge it directly with options). Making a quick buck trading a stock you know well is nice, but I never believe in "I'm playing with the casino's money", because it never is, it's always your money, at every moment in time
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Fair point, but as one is able to pull profits out the risk of loss decreases. Most accomplish this by selling shares at a price higher than they bought them at. I did some of this, but the majority of my derisking came by capitalizing on the shorts activity. I wont get into numbers, but I placed positions near the bottom of several short attacks and sold them a day or two later. The profit I made from this, in my mind, offsets the base investment cost that remained.
I dont recommend this as a strategy, as it is very risky, and you have to have a pretty high tolerance for it.
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