In this SMBU Trading Tip of the Week, Bella, author of the “trading classic” One Good Trade and The PlayBook, talks about being relaxed in your trading using $KORS as an example.
Highlights from this trade:
- Growth stocks need to perform very well to keep their tile as best in breed.
- Softening talk occurred in $KORS, but it kept holding higher. This changed the next day.
- Holds below prior day level and couldn’t trade above VWAP.
- Take some stress off your big idea by looking for other potential trades.
- If you’re not typing up stocks all day long, then you’re not doing your job!
We hope you enjoy this trading education video.
You can be better tomorrow than you are today!
Mike Bellafiore is the Co-Founder of SMB Capital and SMBU, which provides trading education in stocks, options, forex and futures. Bella is the author of One Good Trade and The PlayBook.
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2 Comments on “SMBU Trading Tip: Relaxing in a $KORS Short”
As always thank you Mike. Just would like to ask you: when you have a running a position and you start looking for another stocks, do you have stops in that position? In all the size at different levels?
Thank you,
Jc.
Yes for a position like $KORS I have stops in. If I am wrong I take a small loss and if the fundamentals are truly different for KORS then a large gain is possible. $MS defended the stock the day after the video re: the fundamentals still being strong. So that is a new fact to consider for the position and can cause a position 4 points in the money to being one where we are stopped out.
The point of the video is not really the KORS position but rather how not to place too much emphasis on one trade. When you do so you do not trade the position as well as you should. Being in a few other position helps de-emphasize the position.
One Good Trade, One Good Trade, One Good Trade.
Bella