July End Review of MayankRocks.com FundThursday, August 2, 2012 9:36
Before I talk about the update, I’d like to say that from September, I’m going to share my trades right when I’m executing them rather after the execution. I’m doing this on advice of one of our readers who felt that would be a much more fair to readers.
After Mid-July, I had purchased one 340 call at 22 rupees and as the stock fell below 350, I got another 340 call at 10 rupees and with further fall to 342, I got another one at 4 rupees. This averaged me about 3000 shares at 352. On the day before expiry, Yes Bank gave an absolutely fantastic set of numbers and the stock moved up to 346 on the results day and then to 354 on the day of expiry even when markets were completely flat or even slightly negative. The fund was on it’s way to make some 3000-6000 bucks till the last 30 minutes when suddenly the markets started crashing.
The last 30 minutes were so disappointing and unexpected. My strategy was to roll over the 1000 shares that I had purchased at 362 and book my profits on the other two calls. So I bought one 320 call at 34 rupees, which means 1000 shares at 354 and since only 30 minutes were left for closing, I assumed the stock to end around those levels before suddenly markets started crashing and Yes Bank ended at 346. This sudden fall not just made me lose 4-5 rupees on august call that I carry forwarded, it also ate my profits from July calls.
The correct approach would have been a sell at 346 and 2 lots of carry forward to August at that level which obviously didn’t happen. So there I lost 20,000 there and now I’m simply stuck with just 1000 shares @ 354 now. My original plan was to buy two lots for August if the stock ended anywhere below 350 as any loss trade must be carry forwarded for next month. And the funny thing is, global markets rallied the same day and the next day where I could have bought saw a gap up opening. Anyway mess up happens sometimes, that’s market for you.
The current status of the fund is 492,000, up 92,000 from the original amount in a time frame of one month.