Monitoring Positions

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In this video, I want to talk about how we just go ahead and monitor our positions at the open of the bell each day. Actually, as I’m recording this, you guys are going to hear a sound here coming up in about 25 seconds as we get into this video as the bell starts to open today.

I wanted to start recording this video a little bit before the market open and just go through what I'm looking at as I monitor positions in the morning. Of course, it's important that as you go through here that you're trying to see what the big movers are and the big things you need to change.

Actually, here comes the bell. Okay, market is opened. I don’t know why the bell didn’t actually go off. Maybe I had it turned off. The market is opened now and you can see the positions are starting to flood in and the new trades for today.

You can see everything is starting to quickly change here and we’ve got lots of positions that are being updated and changed throughout the day. Now that we’re started here today, the first thing that we want to do is take a look at positions that are big movers.

If you have something for example that's only moving $4 like our put credit spread here in IWM, we probably don't need to look at that right now. A big move for your portfolio might be $10 or $20, but I’m looking for things that are making really, really big moves.

Let me just slide my platform over here just a little bit. One of the other ways that we can do it is we can take a look at the symbols on our watch list. You can look at the left hand side of the screen here.

I don’t have the symbols here, but I usually rank and check out and see which stocks are making really big moves. Percentagewise, I like to just rank and see which stocks are making big moves.

In this case, the one that right now has a 19% move today is JCPenney. That's a pretty significant move. That’s definitely an outlier from everything else.

And then any stocks that are making big moves down and one that’s making a big move down is MU which we didn't trade through earnings, but we tried to trade through earnings. But you can see it’s got a pretty big move down, so maybe I might want to take a look at that for a possible trade.

But if anything on that list has a ticker symbol that is a stock that you’re trading, then obviously, you’ll want to take a look at it and see if that requires some sort of adjustment because of the big move.

As you start to go through your list, what I like to do is just open up some positions and see what's happening as far as the market change. In XLE, we have a pretty big move up in XLE, we’re starting to lose a little bit of money of our profit.

As I start to go through here, now we start to ask out questions. Does it require an adjustment? Is this a trade that we’re going to let go all the way through expiration? Is this an undefined risk trade, a defined risk trade, whatever the case is?

We want to start to ask ourselves those types of questions as we go through some of the trades that we have. In this case, it’s a defined risk trade and we’re just going to let it go all the way through expiration.

As I go down here, I don’t have too many positions that are making really big moves. The only position that I currently have that’s made a pretty big move and just dollar wise, it's offset is I got assigned on a couple of contracts that I have in US steel.

You can see down here, we got assigned the 300 shares, so although it looks like a pretty big loss here that’s completely offset by what's going on up here with the underlying options that we profit it on, these net out and actually were a little bit positive because of the stock assignment today.

Those might be something that we’re going to go ahead and exercise and close out or we could decide to keep the position, whatever the case is. But you can see this is definitely the first thing on my radar screen today from everything else and that's obviously what I’m going to tackle first.

After you go through all of your positions and just make sure that everything is buttoned up, nothing really needs to have an adjustment or nothing really is pressings, no stocks that you’re trading are down 20% and 30%, whatever the case is, then you really have to just let things be.

I say this in all sincerity because most people assume that you've got to just watch and hover over your positions all day long and that’s just not the case. Most of the trading activity happens in the morning.

A lot of things will move quickly in the morning and then they’ll settle throughout the rest of the day and then move again towards the end of the closing bell. I

t’s important just to check your positions once in the morning, maybe come back if you want to, check them in the afternoon, but revisit some of your positions in the afternoon towards the close of the bell instead of around lunchtime or so just so you have an understanding of where the market might go, if it continues to fall into the close or rise into the close, whatever the case is.

In our case, there’s really not much that we need to do so from here. We’re done monitoring our positions today, now we can focus on either doing something else. If you’ve got a day job, you can work your day job.

We’ll start actually going out and start looking for new positions and analyzing new positions from here. Hopefully this video was really helpful.

It doesn't have to be some overly complicated system that you use as long as you just quickly get in and check and monitor your positions, remove yourself from the market, let the positions work themselves out, you’ll be better off for it long-term.