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Sunday, May 17, 2009

Lottery Tickets 2 Eight Days Later

As previously mentioned, the second Lottery Tickets are MUCH higher risk.  So these lottery tickets aren't for the feint of heart.
Lets take a look how we did 8 days later.

Stock 5/7/9 5/15/09 Percent Gain
FAZ 4.75 5.90 24%
SRS 20.1524.46
TZA 24.9530.03 20.4%

As impressive as these returns are, all these stocks could easily go negative on return in two days. I'll be impressed if we can make it to next weekend with higher returns than 20-25% per stock next week.  It isn't a bad idea with these gains made, to put stop-losses in at the entry points I listed above, to ensure you don't lose your shirt if I am wrong. 

If your a high roller, sell 50% at 100% return, and let the rest ride. Tempted to gamble sell 50-75% of the stock at 50% up. Or plain crazy, keep it all until it seems like your shocked how low the market ran. I'm in the last group, mainly since we saw a 40% rally in 9 weeks should mean a decent pullback.

It isn't too far fetched to see  SRS hit at 75,  FAZ 12 to 20 (Depends on velocity of market movement), and TZA I'll get nervous over 50 bucks.   All could hit MUCH higher numbers if the market is headed to new lows, which is a very real possibility.  I reserve the right to get cold feet at any moment and dump all. :)

Still, the best bet was the short pays already mentioned here.
A special thanks to Happy John, who gave me the confidence to bet larger on these plays than I normally would for Lottery Ticket plays.  Happy John is a fiscally conservative person, and he placed some of the largest bets (considering the risk) than I have known him to do in the last 3 years.

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