If recent movement in equity markets doesn’t qualify as “whipsawing,” then I’m not sure what does.
While some of the recent volatility may be attributed to results announced during the most recent earnings season, it seems like a good chunk of it can also be linked to concerns about the global economy. Those concerns have been amplified by rising interest rates and the ongoing trade dispute between the United States and China.
If any symbols in your portfolio have started to act like “whipsaws” as a result of recent volatility, a previous installment of Anatomy of a Trade is likely worth a few moments of your time.
The show focuses on one whipsawing stock in particular, Micron (MU), and tactics/strategies that were used to help minimize collateral damage associated with the whipsawing action.
While you may not trade Micron in particular, it’s a great example to review because it may help you better understand the choices available to you if (or when) a whipsaw does pop up in your portfolio.
Because MU went through a “fantastic voyage” (i.e. roller coaster), there's simply no substitute for a complete review of that “incredible” journey. In that regard, we hope you'll take the time to review the complete episode of Anatomy of a Trade focusing on whipsawing action in MU when your schedule allows.
If you have any questions about trade management in volatile trading environments, or any other topic, we hope you'll leave a message in the space below, or send us an email at email@example.com.
We appreciate your feedback, and look forward to hearing from you!
Sage Anderson has an extensive background trading equity derivatives and managing volatility-based portfolios. He has traded hundreds of thousands of contracts across the spectrum of industries in the single-stock universe.
Options involve risk and are not suitable for all investors. Please read Characteristics and Risks of Standardized Options before deciding to invest in options.