Never Let Greed Override Your Trading System 

This trade took off from the start and never looked back. Only problem is, when things work out this well so quick, do you now let your judgements over rule your pre planned exits based on extensive testing of the past?

Answer is ‘No’.
Could Merck get back to it’s high? Of course.
Could you potentially double your profit buy hanging on tight? Of course.

Good trades like these often play with your emotions, which is why it’s best to have your rules and systems right in front of you so you don’t break them!

Being able to do this ‘consistently’ and let go of ‘what if…’ is a sign of trading maturity.

Here are the results.

MRK Trade Completion - 23.3.15

Trade Exit – MRK, Merck

MRK, Merck Stock Exit @ $58.73 on 23 Mar 2015 (Blue Shade).

Stock Original entry @ $56.17 on 12 Mar 2015 (Green Shade).

Total Return on Investment (ROI) of +4.56% and +151.23% annualised.

MRK, Merck LEAP Option Exit @ $5.71 on 23 Mar 2015

Option Original entry @ $4.25 on 13 Mar 2015 (Green Shade).

Total Return on Investment (ROI) of +34.35% and +1253.88% annualised.

Duration 11 days and 10 days respectively.

Reason for exit; 
Stock demand exceeding normal levels in the short term and hence a high probability of price reversal over the coming days.
Company is of long term fundamental investment quality but well over valued and hence was only a short term trade which has been completed.

 

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