I have kind of a love-hate relationship with Google. As for the Love part, you have to love a company created from nothing less than 15 years ago by a pair of college Computer Science majors. Now the company has the 3rd largest capitalization of any company on the US market. The other part of the love is that Google hosts the blogger platform that makes this blog possible - and I have never paid them a nickel to use it.
As for the Hate part, you have to resent a company this powerful. Note that Google keeps a record of everything you have ever searched for by source IP address. Think about everything you have ever searched for through Google and think about how much Google knows about you as a result. For that reason alone, I have started to use bing.com for all my web searches. Bing is hosted by Microsoft - But Its Not Google.
The other part of the Hate relationship is that I went for a job interview with Google in New York City. After weeks of preparation, they basically laughed me out the front door. That's right - I am not nearly smart enough to work at Google. Well maybe it wasn't quite that bad, but it felt that way.
Another thing about Google is that it has been notoriously hard to trade. Recall in last week's post, I went into the weekend long the 995 call at about 21. At the time, the stock was about 1011, and I was expecting a gap up to the 1020 area on the open. That would yield a quick $900 profit which I was eager to collect in my TradeStation account which has been struggling to get out to a new equity high.
Early in the pre-market on Monday, the stock was trading at about 1020 and I already licking my chops at the easy profit I would collect. There's nothing like a $900 profit to get your day off to a good start. I was watching right at about 9:30 and was disappointed to see the stock open in the 1012-1013 area. I had about a $100 profit on the contract and I know from opening gap plays how fast the stock can reverse after the gap. So I put a stop loss in at least to lock in the $100 profit and waited for a fill. The stock dropped though my stop but no fill. I sat there for a minute or so and waited, reminiscent of my prior post The Gap, Freeze and Slip. About a minute later, my fill came through - filled for a loss of $45!
How could what should have been a $900 profit turn into a $45 loss? The options market has many way of separating you from your money and I could only conclude that events have conspired against me. But I got my just deserts later in the week and here's where the story gets fun.
I was watching Google on Wednesday and the stock was strong. It had traded down to the 1000 area and bounced strong and was headed for an all-time closing high. I was about 1:25 PM EST and the stock cleared the 1017 area. So I picked up the next Friday GOOG 1000 call for about $24 giving the stock a fair value of $1024. After a brief rest, the stock moved higher. I was surprised to see it clear 1020 a short time later and I was up a few hundred. This time I sat back and gave it some room to breath and sat through a brief pullback in the mid $1020's.
I continued to ignore the stock and was surprised to see it break the 1030 zone not too much later. Now here is was less than 2 hours after entry, and I as up nearly $1000! So I put in a limit order to sell at $34 and was filled instantly. I had my revenge, I bagged $1000 on Google options in less than 2 hours time! Total commission paid on the trade $2. TradeStaion worked like a champ on this trade - total commissions paid on this trade $2!So that trade aside, I have been struggling in my TradeStation account. I haven't seemed to find my edge. On the plus side, the account has been positive from the beginning and hasn't gone into an equity draw down from its opening value - not even once. At one point I was up 10% - peanuts by John Carter standards - but not bad for me.
I came to the conclusion last week that I need to pick my trade entries much more carefully and wait for well-defined setups on the daily chart before taking action. More to come on that.
Enjoy your weekend and have a great week ahead.
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