Trading results 3/9/10

March 9, 2010 5:56 pm Robert Weinstein Trading results

No shares available

AIG gave a sell signal but IB didn’t have shares to short. Interesting thing is that TS did have them but that was not an option as the account is not large enough to use as effective fading.
Knowing how large the trading in AIG is I thought I would take a look at the options to see what type of volume there was and how close of a beta I could find. As it turns out the 30 and 31 march calls had a very tight beta and also had a small spread allowing for the options to be an appropriate substitute for shorting. One thing I hate about options though is how the markets still give the market makers a huge (illegal in my opinion) advantage in that both side of the market can not be engaged in at the same time with the same account. This means that I can not make a market and trade into a position as easily as I can with a stock. The action was heavy enough though that I saw this as a very small relative hindrance. Also by being able to use the 30s and the 31s at the same time I could effectively trade both sides of the market as they both had the same characteristics. I ended up trading both but stayed small with a total of 3 contracts (2 and 1) as it was obvious that news was about to be released (no news had been released at the time of the trades)
+ 42
+ 97

ANF fell as expected but not as much as I would have liked. I did trade it both ways but not aggressively. I ended up putting in orders near my BE and above 43 as I left to go to the Doc. I thought I would be able to take some time in the waiting room to manage the trades but as it turns out I needed to go into the basement level and I had no phone coverage. Upon getting out I checked the trades and found all my bids hit except one at 42.7x. At the time there was about 10 or less minutes left in the day and the NBBO was 43.02-3 with my cost of about 43.18 I decided to close out the last 100 shares and adjusted the order to bid it at 43.02 which was hit. Not the worlds greatest trade as I was right back where I was in premarket today (although now at a higher basis) + 59

+199

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