The Trend is Your Friend

I am learning to trust the trends in the charts that I make.  Today MCP had a huge gain, and I was able to sell my Call options for a $90.04 gain.  That is 11.93 % of the $754.97 that I spent, and I earned it in just seven days!  Multiply that by 52 weeks in a year and the annual % yield is 620.17%!  I don't know about you, but my savings account doesn't earn that much interest. (Correction: I think I got a little carried away on my calculations.  To be fair, I consider this a monthly investment, even though I made the money in seven days. So, I think the actual annual % rate would be 143.16%)

I sold my options early in the morning, around 7:00 a.m..  Had I held on and waited to sell them near the closing bell, I could have made over $400.  I was a little bummed that I sold them early, and lost out on the opportunity to earn more. But, I have to remember that I made $90.  Just think how much I would have made if I would have invested all of my money, $5,188.  That is a little too risky for my blood right now.

I am just stunned that I made so much, with so little money.  This is far better than leaving it in a savings account, and a lot more fun.  I have included a chart with today's movements. The stock actually broke past the upper trend line that I drew earlier in the month.

Figure 1: MCP

I will put two entries on my spreadsheet for October since I made two trades. Now it is time for me to research my next move for November.