Anatomy of a Good Trade

A few days ago I posted Anatomy of a Bad Trade, where I openly discussed the worst stock trade I ever did and the lessons I learned. This week I had a picture perfect trade, where I followed my rules and exited a position with a huge gain.

My rules:

1. Look for beaten down UltraShort ETFs with price support that are on sale early in the week.
2. Set stop loss in the event the price support fails.
3. Lock in gain, preferably before the close on Friday.

Bought 90 SRS @78.22 on MON 12/8

Sold 90 SRS @99.78 on FRI 12/12

This time I didn’t get greedy on a Friday. Instead I exited the trade and locked in the gain. Good thing I did, because the stock tanked shortly afterward almost 20%. Now it is the weekend and I’m holding no leveraged ETFs in my account and I’m another $1,920 closer to retirement. This was a good week.

This is not investment advice, but I would not be surprised to see SRS do a similar moonshot move in the next week or two. Hit it and Quit It. Rinse and Repeat.