Learning When To Hold Them And When To Fold Them...

OneWeekJob_Day3_001I had a great week working with Andrew as a Stock Trader. He was nice enough to welcome me into his home in Weston, Florida, lend me his trading secrets, and not to mention introduce me to an amazing game on XBOX called Guitar Hero 3. On my last day, I thought I was getting a pretty good handle on things; I was reading the charts, predicting where the stock was going to go, deciding on what would be good buy and sell points. I was getting the hang of it, and was getting a little confident. Just as I did, I learned a very valuable lesson: no matter how many models and techniques you have to help you predict what direction the stock should go, the bottom line is that the stock market is unpredictable.

The stock that I was watching was Crocs - the shoe company. It was a bad day on the market overall and the stock was down, I thought for sure that it was a good buy point and asked Andrew if I could purchase 500 shares at $38. He said sure. The stock began to look positive and then it starting going down, and down. Andrew asked if I was going to just sit and watch it go progressively lower, saying that you must decide on a point where you have to cut your loses. I felt really bad. All of a sudden it wasn't so easy, and then I did a quick calculation of 500 x $38 and realized I was dealing with some serious money.

We sold it down $2 a share and the stock continued to go down. So much so that Andrew thought this was getting ridiculous and that it had to come back up, so he went back in for 2000 shares. As soon as he did, the stock started to climb quickly. I felt like I was cheering on the home team watching that stock rise and urging it to push further. Then it was time to rush out the door, speed to the airport, do a tv interview at the airport as I was checking in, and then barely make it to my plane - pretty exciting. In the end, we ended up $5000 in the plus for the day and a valuable lesson learned.

Next week I am heading to Brooklyn, NY where I will be a Baker in Brooklyn. If you are in the area and want to meet up, let me know.