Friday, March 5, 2010

03/05 NDX Fast Butterfly

NDX hit my up-side hedge-recover zone, so I had contingent orders to flatten the deltas and by end of day I added a new bullish butterfly. My goal: to get out of the trade with a small profit next week. The pros of using the hedge-recover: Turning a loss into a win; the cons: deploying more capital and having a bit wider loss (~14% instead of ~8%).
Note: Whenever I add capital to a position, I do not add this new capital to the amount of money I used to define the original stop levels. The capital is deployed, but the idea is to maintain the risk per position consistent.

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