Here's a nice recap of how today looks in the US equity market:
Hundreds of stocks at new 52-week highs (and many of those are new all-time highs) while a handful of names are at new lows (and a bunch of those are inverse ETFs, meaning a new low is a new high for the underlying).
Seems like the stimulus has worked, I guess. Unless something freaky happens, the S&P 500 will finish the year up nearly 27%, placing 2013 in the top 10 best annual returns since 1947. Even as details of Fed tapering were released, stocks lifted, for most of this year bad news was good since that meant the Fed would stay dovish and good news was good since it was good news. I can't believe too many traders stayed short very long, and anyone less than 'all-in' is likely kicking themselves and wondering how the typical buy-and-hold Pasadena Grandma managed to have a better year than most of the highly-paid 'pros' who watch the market all day long!
In my view, this year is why a major part of eveyone's (including trader's) assets should be locked away in a 401k/529/IRA etc account and untouched for decades. My son's 529 plan is up 25% this year, well beyond my trading account gains and I'm glad I wasn't trying to trade his way to college. While there are plenty of trading opportunities and strategies to put to work in the options markets, it's important to remember trading is a risk/reward game most of the time, and while we continue to look for the most favorable situations, risk is always an issue, magnified, of course, by the relatively short time horizon for most traders versus decade-long buy-and-hold periods.
OptionsProfits can be followed on Twitter at twitter.com/OptionsProfits
Henry can be followed on Twitter at twitter.com/OptionAlert
EXCLUSIVE OFFER: Jim Cramer's Protégé, Dave Peltier, only buys Stocks Under $10 that he thinks could potentially double. See what he's trading today with a 14-day FREE pass.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV