Monday, August 24, 2015

Markets gone berserk

It looks incredible to me when I checked in this morning.  Down 700 points, but it was worse at the open.  Then it seemed to battle back before fading into the home stretch.

The market is down over 2k points, but I'm nowhere near breakeven in my position.  I know why, too.  The way this thing works is that it mimics the percentage move each day.  But, if the stock goes down 20 %, it has to rise more than that to get even.  Example:  Stock falls 20% from 100 to 80.  In order to get back to 100, it needs to rise 20 points out of 80, not 100.  It has to rise 25% in order to make it to breakeven.

I knew all that, but for some strange reason, I've been overlooking it.

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