I received a well-meaning question from one of our clients today regarding an open position.
This client missed getting into the trade a couple of months ago.
Paraphrasing her question, she asked, “Since the stock is still above your stop loss level, would it make sense to buy the dip here, and/or would you add to your position here?”
Again, it’s a well-meaning question – one I’m sure we all often wrestle with.
The problem, however, is that the position isn’t acting well. It’s a longer-term trade for us and still has a ways to go until options expiration, but the stock is currently trading well below the level at which we first got in.
In the chart below, you can see where we entered at the purple circle: [Read more…]