I'm not entirely sure that trading Research In Motion is worth the headache, but it certainly does make one of the central tenets of profitable trading very clear: it's not how often you're right or wrong, it's how much money you make when you're right, and how much money you lose when you're wrong.
1. LONG the week of 5.19.03 at $3.34. With a $2.44 stop the initial risk (R) on the trade was $0.90. Stopped out and reversed to short at $21.78 the week of 2.22.05. The percentage gain on the trade was 552.1%, and the reward-to-risk ratio was $18.44/$0.90 = 20.53.
2. SHORT the week of 2.22.05 at $21.78. With the stop at $29.63 the R was $7.85. Stopped out and reversed to long at $27.71 the week of 3.14.05. The percentage loss on the trade was -27.2%, and the reward-to-risk ratio was -$5.93/$7.85 = -0.76.
3. LONG the week of 3.14.05 at $27.71. The stop was $18.16, so R = $9.55. Stopped out and reversed to short at $22.77 the week of 9.26.05. The percentage loss on the trade was -17.8%, and the reward-to-risk ratio was -$4.94/$9.55 = -0.52.
4. SHORT the week of 9.26.05 at $22.77. With the stop set at $28.46 the R was $5.69. Stopped out and reversed to long at $26.87 the week of 3.6.06. The percentage loss on the trade was -18.0%, and the reward-to-risk ratio was -$4.10/$5.69 = -0.72.
5. LONG the week of 3.6.06 at $26.87. The stop was $20.03, so R = $6.84. Stopped out and reversed to short the week of 5.15.06 at $22.50. The percentage loss on the trade was -16.3%, and the reward-to-risk ratio was -$4.37/$6.84 = -0.64.
6. SHORT the week of 5.15.06 at $22.50. With a $28.73 stop the R on the trade was $6.23. Stopped out and reversed to long at $26.67 the week of 8.14.06. The percentage loss on the trade was -18.5%, and the reward-to-risk ratio was -$4.17/$6.23 = -0.67.
7. LONG the week of 8.14.06 at $26.67. Using $20.70 for a stop, the R = $5.97. Stopped out and reversed to short at $106.95 the week of 9.2.08. The percentage gain on the trade was 301.0%, and the reward-to-risk ratio was $80.28/$5.97 = 13.45.
8. SHORT the week of 9.2.08 at $106.95. With the stop at $148.89 the R was $41.94. Stopped out and reversed to long at $59.29 the week of 3.30.09. The percentage gain on the trade was 44.6%, and the reward-to-risk ratio was $47.66/$41.94 = 1.14.
9. LONG the week of 3.30.09 at $59.29. The stop was $33.68, so that means R was $25.61. Stopped out and reversed to short the week of 10.26.09 at $58.73. The percentage loss on the trade was -0.9%, and the reward-to-risk ratio was -$0.56/$25.61 = -0.02.
10. SHORT the week of 10.26.09 at $58.73. With the stop set at $77.33 the R was $18.60. Stopped out and reversed to long at $75.34 the week of 3.8.10. The percentage loss on the trade was -28.3%, and the reward-to-risk ratio was -$16.61/$18.60 = -0.89.
11. LONG the week of 3.8.10 at $75.34. The stop was $60.87, so R = $14.47. Stopped out and reversed to short at $52.23 the week of 6.21.10. The percentage loss on the trade was -30.7%, and the reward-to-risk ratio was -$23.11/$14.47 = -1.60.
12. SHORT the week of 6.21.10 at $52.23. With a $69.59 stop the R on the trade was $17.36. Stopped out and reversed to long the week of 10.25.10 at $56.92. The percentage loss on the trade was -9.0%, and the reward-to-risk ratio was -$4.69/$17.36 = 0.27.
13. LONG the week of 10.25.10 at $56.92. Using a $42.68 stop, the R was $14.24. Stopped out and reversed to short at $54.78 the week of 4.4.11. The percentage loss on the trade was -3.8%, and the reward-to-risk ratio was $2.14/$14.24 = -0.15.
Winning Trades: 3 | 23.1% | $48.79/share avg.
Losing Trades: 10 | 76.9% | -$7.06/share avg.
Average Trade: Gain of 55.9% | $5.83/share | Reward-to-Risk Ratio (R): 2.22
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