Avoid Getting Hosed By Following Billionaires


Manage episode 152573513 series 1063725
על ידי Joshua Belanger התגלה על ידי Player FM והקהילה שלנו - זכויות היוצרים שמורות למפרסם, לא ל-Player FM, והשמע מוזרם ישירות מהשרתים שלכם. הירשמו כדי לעקוב אחר עדכונים ב-Player FM, או הדביקו את כתובת העדכונים באפליקציות פודקאסט אחרות.
Last Thursday, I was looking at my trading platform trying to find an opportunity. This market has been so dull and uneventful. It feels like you're sitting in a government office waiting to be called filled with 30 other people and counting them down. Then all of a sudden out of the corner of my eye I start to see Apple drop like a rock, again. That's a little interesting since earnings were out a few days before that saw prices decline. So I clicked on the symbol and started to watch it drop from 98 to 97 to 96 and then bounce off 94 and hold into the close. As it began to fall, I quickly knew like the rest what may have spooked more investors. Mr. Carl Icahn was on CNBC and said they had exited all of their Apple position. Slow clap, it was a great trade, but I don't agree with his tactics of using social media or T.V. to talk his position, but if people are that uninformed to put stock into what he says, it's their money. I find it funny how many people and even professional trash CNBC, but still watch it and listen to guys like him. Do I watch it? Hell no! Do I care what Mr. Icahn says? Hell no! Nor should you. Why? Taking the words of The Rock, It doesn't matter what he says! So many get lazy or think that people like him know more than you. Hedge fund managers have HUGE egos, which leads to taking enormous positions, which means substantial risk. While Icahn's Apple trade worked well, take a look at his other holdings. They are losing a lot of money. While he cited a few reasons why he sold, the one he failed to bring up was he likely needed to. With those other positions that have been hammered, he needed to release some capital. So if he sold his stake over the last several months, how come you didn't know about it until after the fact? I mean he talked it up when he was in for the last year getting people excited. There are so many lazy financial professionals out there that manage money, They idolize people like Icahn Because of the amount of money under management, which to them is a status of success. So the natural process is for these people are to follow what he's doing. Who gets hosed? You do! Apple prices are back to October 2014 levels and like most who just follow people and don't know what to do afterwards, they take the ride and end up at the same place. So where does Apple go from here with Icahn out? Same as before, up or down. Bias is part of creating success, but putting on the right trades are more important. For instance: If you think prices go higher here, you buy a call spread or calendar If you think prices go lower here, you buy a put spread or calendar. Why? Apple implied volatility dictates that. Knowing how to craft the right trades consistently is part of the formula for your success. If you want to know why that is and have a desire to create more success doing it yourself, then this manual for your success is what you're going to want. http://www.FearlessInvestingWithOptions.com To your wealth, freedom & options! Joshua Belanger

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