Friday, September 19, 2008

Who Woulda Thunk?

If you'd told me on Wednesday morning that the Citigroup (C) I sold was at the bottom, I'd think you'd be right a good amount of the time. It's just that I was willing to sacrifice selling a portion at the bottom for fear that any more damage might have put me over the edge causing panic, etc.

Now, if you'd told me that the C shares I've got that are currently covered by calls would be in danger of being called away at $20, I'd have thought you were crazy. But, that's where we are today. What a wacky crazy week.

I did manage to add to my Goldman Sachs (GS) position in the retirement account... added some at 104.45 yesterday. So, for the record, the shares have a cost basis of $113.79. I did sell some tech to finance that purchase, but I guess I'm on the good side of that at the moment.

I guess in short, it sure looks like the little guy (me) sells his C at the bottom. On the bright side, I didn't sell off too much of it.

As much as this market jump helps me, I am not necessarily a fan of the outright ban on short-selling of financial stocks. Of course, I don't have all the information on it, but it doesn't feel right. Creating an imbalance like this can't be what's in the best interest of the markets, but what do I really know.

-- Edit #1 --

Okay, the market's closed, and C closed above $20. Come Monday, I will be down to only 25% of my original position. Who would have guessed? Clearly, I did not.


The Travelin' Man said...

Sorry about your taking a kick on C. I bought UYG last month for just over $21 and sold $22 calls - cleared $1.40 cash after commission. The fund went up and it went back down - and I think it was selling for about 39 cents a share the other day. Anyway, it closed at $21.96 - yikes! I think I would have rather been called away. I guess I can still sell next month's $22 calls and pocket another ~$2/share.

Be careful out there....things are craaaaazy.

Brute Force said...

Ya, I guess on the bright side, only 25% was sold at low prices. 50% was sold at $20 due to the covered calls. So, I suppose it could have been a lot worse.

Thanks for commenting... it's been a while. How've you been? Everything working out okay for you these days?