Pure Panic!

On Friday the number of emails in pure panic mode were exceptional. My favorite was this:

"Floyd, it's clear that the market is now in full break out. I read this on CNN Money and don't understand why you think the market might even go down. All the charts tell me this, and I've talked to several bankers who assure me that the market is headed higher"

And my next favorite:
"Hi Floyd,

I've got a good story for you here.

On Tuesday or Wednesday of last week, I placed my first order from one of your alerts. I don't remember the PUT that you recommended (you'd think I'd have it written down in my journal but I don't - another mistake) but I accidentally placed an order for 7 contracts (I wanted 1 contract). I was so nervous that I did not know how to cancel the order before it filled and needless to say, I had about $7500 on the line (my account is $30,000. Fortunately for me, your alert was correct and I made a quick $1600. I couldn't believe how accurate your predictions were throughout the entire day. Needless to say, I was fired up and ready for the next trade. What a rush!

The next day, you sent out another alert for the 655 PUT (I believe you said to get in under 17.10. I wanted to get in so bad that I bought a contract for 16.50. The price quickly dropped and I bought another at 16.10. As we all know, the price continued to drop and the faster it dropped, the quicker my anger and frustration began to rise. I figured that if I kept buying puts at a lower price, my overall cost would decrease and when the OEX reverses (which of course it will b/c FLOYD said so - I couldn't imagine you being wrong) I will make a great profit. So I bought another contract at 14.50, and another at 14.30 and TWO more at 12.90, one more and 12.80 and finally one last contract at 10.80. All in all, I bought 8 contracts for an average price of 13.85 ($11,080 - without commissions). Remember, my entire portfolio is only $30,000. This is my 2nd week of trading!!

What a perfect of example of how emotion and greed can ruin a trader real fast!!

So you can now imagine why I NEED this puppy to drop a lot and drop fast because I cannot stomach watching 1/3 of my portfolio get pissed down the toilet due to my stupidity.

As I type this, I am ONLY losing $2700 and I am seriously thinking about taking a loss on the entire thing. I can stomach a $2700 loss. I can't imagine a 7 or 8 or 9, 10, ELEVEN THOUSAND DOLLAR LOSS!! NO WAY! Not this early in my trading career. That is 1/3 of my portfolio.

I promise you one thing Floyd - I have learned my lesson about over leveraging, greed and anger. NEVER AGAIN!!

At this point, I'm just trying to minimize my losses. Any recommendations? I should would appreciate any help.

Feel free to use me as an example of what not to do!!

Hope to hear from you soon,

M"

And, in my ongoing email "teaching" as "trial subscribers try us", an email from a gent canceling his service. This one I'll teach from, and I wish this gentleman the best:
"always a pleasure to listen to your analysis. I'm interested in live alert. Your email is excellent- it teaches us how you look to OEX but it did not help us to make $$

It will be excellent subscription if you said clearly we are buying 655 call for $9.50
we are selling 655 call for 10.80 or we are holding overnight and we looking for $13.90 and our stop $4.50.
we are buying put 650 for $11.70 target $14.90 stop loss 3 day or $5.50
thanks for your time and effort. appreciate all your help"

1. He's tried us before. This is called a "churner". They spend much of their time trying a variety of services.
2. Making money is hard. No service is the holy grail. I have clandestinely subscribed to so many services that "offer signals" and never yet have I found one in which you can truly ever "buy at 10.80, sell at 13.90"....or where the service tells you EXACTLY what to do. Think it out: if every subscriber did this the market would flood with the same orders, if the service is of any size.

This in the industry is called "the signal game"....these services make their livings churning through many subscribers that pay to join and have a few successes, but many failures.

If you are the type of subscriber that wants this, please save your money. You will lose it. No service can help you "buy/sell". You must learn HOW to buy sell.

Yesterday the market was first led downward, so the talking heads tell us, because the idiots at Microsoft didn't buy the idiots that ruined Yahoo. This is NOT the reason the market fell. This was the EVENT that triggered the first sell off in the market, that we projected earlier last week, and that has a 55% chance of continuing in downturn. Yesterday the market moved to a theoretical Dow low of 12,900. More downside could occur.

Buffett, the legendary investor, recently advised that he believes the financial meltdown that could occur has lessened in risk. He also advised that stock market gains will NOT be large over the next year, and that smart investors must "think small".

This is one more reason to play index options. Astute investors can gain 10 to 30% on intelligent index investing daily, hourly and weekly, and at the same time invest in solid moves, such as through our stock/option Floyd investing at www.bluechipoptions.com

Do NOT expect high gains. You won't get them. We have done a great job in destroying our own economy and have a long way to rebuild. Remember this as you consider your Presidential candidate.