Round 2 : Week 2 Day 5 Trade Log

This week was a difficult one. Mostly from the fact that I lost £8,304 on my FTSE 250 short!

It's unbelievably frustrating watching your profits being eaten up by a short hedge strategy, albeit a strategy I feel I need, this one just may not be the correct one.

I looked into other options (excuse the pun) and buying a PUT option on the FTSE, but it too is a very expensive option (Too many puns!)

It's also very difficult to work out which strike price to buy the option at and which contract to buy, i.e. how far out the option expiry is; April, June, September etc.

I looked briefly at covered warrants as well, but they too are expensive.

So I have revised my strategy slightly. I have now taken a hedging bet on both the FTSE 100 and FTSE 250. I took out the initial bet on the FTSE 250 because most of the stocks I have bets on are on the FTSE 250, but I also had some on the FTSE 100. I worked out a weighting of how many bets were on companies belonging to which index and that number versus my total bets, and used that to calculate how much to place on a short bet on each index. My bets are now also a lot smaller.

So, to cut a long story short, I know have 4 short bets, 3 on the FTSE 250 and 1 on the FTSE 100. Reason for this is that I am going to close my short bets as and when I reach certain targets, so it's just easier to manage with multiple bets and the spread being what it is with indices, it's OK to open more than one on the same index. My theory anyway!

Below is the result, I am down just under £4,000 from last Friday, but considering the week that it was in the markets, that is not a great result, so I am looking to improve this in the next few weeks!

I hope you are all having a great weekend.

Until next week...

Stock	Long/Short	Entry Price	Latest Price	Current profit/loss	% on prev day
Arm Holdings	Long	934.90	945.50	399.01	-4.65
Advance Computer Software	Long	90.23	94.52	1,692.75	445.66
Aveva	Long	2,303.00	2,274.00	-453.22	-328.68
Bellway	Long	1,134.80	1,149.00	439.96	-22.19
Cineworld	Long	272.68	277.38	610.05	-55.54
Diageo	Long	1,952.00	1,986.00	947.00	-21.87
Domino's Pizza	Long	526.30	580.00	3,634.03	30.36
Easyjet	Long	987.00	1,058.00	3,325.98	3.34
Euromoney	Long	924.80	910.00	-573.49	-15.61
Intertek	Long	3,300.30	3,436.00	1,454.88	5.42
Ladbrokes	Long	224.36	225.20	129.78	-64.80
Porvair	Long	198.50	196.97	-278.75	0.47
Ryanair	Long	566.30	583.00	1,048.23	-6.77
Spectris	Long	2,367.00	2,374.00	101.24	-57.23
Telecity Group	Long	926.30	906.00	-785.23	-1,930.37
FTSE250	Short	13,679.84	14,018.79	-8,304.21 (SOLD @ -14,035.90)	-30.15
Restaurant Group	Long	425.06	437.80	1,068.22	-33.15
Interserve	Long	497.34	495.80	-112.37	-335.37
Dialight	Long	1,294.20	1,328.00	929.02	482.46
FTSE100	Short	6,480.86	6,483.58	-9.52 (BOUGHT)
FTSE250	Short	14,007.90	14,018.79	-27.22 (BOUGHT)
FTSE250	Short	14,007.90	14,018.79	-27.22 (BOUGHT)
FTSE250	Short	14,007.90	14,018.79	-27.22 (BOUGHT)
Running profit / loss				9,161.54
Diff from prev day				-1,828.81