RE:Punjabi - tell me if this is a good plan?I am looking at LRE market book the largest bid is for 40000 shares by TD @1.60. The second largest bid also from TD at $1.54 for 22000 all other bids down to $.02 are for much smaller size.
I do not have a crystal ball & do not know what will happen in the future. There are lots of unknowns. Price of oil in the next few weeks, the size of tax loss selling, the size of cut in capex & dividend. Market conditions.
Stock markets are very unpredictable. You can make a plan it may or may not work at all or may require some tweaking.
What I understand is that you want to trade the dividend. First the company has not announced the dividend yet. So there might be no dividend. In case there is a dividend. The company will announce it.
After the announcement & before ex dividend trade you have to buy some shares. I would buy some immediately after the annoucment & the rest in few days before ex dividend provided that your are comfortable with the price. If there is lot of panic selling or market sentiment is not good then stays away. It is not worth it. Retail investors get trapped for a small dividend & lose huge amounts.
Let’s assume you bought some shares & on the last trading day before ex dividend the stocks pops lot more than the amount of the dividend. I would sell all the shares & take the profit & run. On Ex dividend sometimes the stock tanks as dividend traders try to get out & there is not much buying interest. If you have bought at a good price it is better to wait out till there is a bounce to get out.
I would not buy that many shares you may have a problem getting out on ex dividend. Whatever you purchase buy them in stages & different prices. I would trade in a position & take advantage of intraday volatility. On the day of buying based on the price of the oil, level 2 & other factor find the possible bottom & buy around that price. Once you have some shares & if you can figure out the trading pattern & range. Sell at the top with some profit & reload at the bottom. If your cost is $5 flat then flipping shares even with small spread you can make money.
If your objective is only making $.035 div spread then you might better off trading & taking advantage of intraday swings. Today the stock has intraday swing of $.15. Getting $.05 spread would have been easy & less risky. You would have a problem trading a large block. I would not trade more that 20k block at a time. Maybe even smaller multiple trades.
When you post large orders you are exposing your position. Small traders will trade around you. It is better to break up your order.
Personally I would not buy 165k shares for div trade for a spread of $.035. Too risky with poor reward. I would use a smaller amount & try trading intraday for small spread it is less risky.
On the other hand If LRE is at the right price under certain conditions I would consider is for a tax loss trade. Get the dividend anyway & sell in January when all the sellers are exhausted & the stocks drifts higher. This would be if there is less risk of big plunge in oil prices.
When trading for small spreads you have to constantly assess & take in account the changing market conditions.
Make a trading plan test it & tweak it. Figure out the trading pattern & see if you can get a div trading everyday. For LRE only pull back trading would have worked.
| Close Prices Last 3 Months | | | | | | |
| Date | Open | High | Low | Close | Chg | Total Vol |
| 12/4/2014 | 1.77 | 1.78 | 1.63 | 1.66 | -0.11 | 2,272,284 |
| 12/3/2014 | 1.77 | 1.89 | 1.74 | 1.77 | 0.09 | 3,166,508 |
| 12/2/2014 | 1.75 | 1.86 | 1.65 | 1.68 | -0.11 | 9,663,109 |
| 12/1/2014 | 2.12 | 2.14 | 1.77 | 1.79 | -0.38 | 9,573,588 |
| 11/28/2014 | 2.32 | 2.33 | 2.11 | 2.17 | -0.22 | 4,272,207 |
| 11/27/2014 | 2.66 | 2.68 | 2.33 | 2.39 | -0.31 | 3,915,072 |
| 11/26/2014 | 2.82 | 2.82 | 2.7 | 2.7 | -0.16 | 1,690,520 |
| 11/25/2014 | 2.89 | 2.91 | 2.8 | 2.86 | -0.03 | 2,394,946 |
| 11/24/2014 | 3.01 | 3.01 | 2.85 | 2.89 | -0.13 | 1,963,090 |
| 11/21/2014 | 2.98 | 3.1 | 2.96 | 3.02 | 0.13 | 2,235,875 |
| 11/20/2014 | 2.72 | 2.93 | 2.7 | 2.89 | 0.16 | 1,920,980 |
| 11/19/2014 | 2.78 | 2.79 | 2.7 | 2.73 | -0.03 | 1,304,774 |
| 11/18/2014 | 2.87 | 2.88 | 2.75 | 2.76 | -0.08 | 1,722,798 |
| 11/17/2014 | 2.86 | 2.91 | 2.78 | 2.84 | -0.02 | 1,242,898 |
| 11/14/2014 | 2.82 | 2.94 | 2.8 | 2.86 | 0.03 | 2,090,638 |
| 11/13/2014 | 2.97 | 2.97 | 2.8 | 2.83 | -0.15 | 2,347,413 |
| 11/12/2014 | 2.94 | 3.05 | 2.89 | 2.98 | 0.05 | 1,786,695 |
| 11/11/2014 | 2.85 | 3.005 | 2.8 | 2.93 | 0.03 | 1,561,626 |
| 11/10/2014 | 3.04 | 3.1 | 2.86 | 2.9 | -0.08 | 2,568,043 |
| 11/7/2014 | 2.87 | 3.02 | 2.82 | 2.98 | 0.12 | 2,949,245 |
| 11/6/2014 | 2.83 | 2.87 | 2.73 | 2.86 | -0.09 | 3,911,760 |
| 11/5/2014 | 2.85 | 2.99 | 2.82 | 2.95 | 0.13 | 2,053,582 |
| 11/4/2014 | 2.94 | 2.95 | 2.79 | 2.82 | -0.22 | 4,358,001 |
| 11/3/2014 | 3.21 | 3.21 | 3 | 3.04 | -0.15 | 2,134,108 |
| 10/31/2014 | 3.2 | 3.23 | 3.14 | 3.19 | -0.06 | 2,961,329 |
| 10/30/2014 | 3.29 | 3.3 | 3.22 | 3.25 | -0.06 | 2,733,625 |
| 10/29/2014 | 3.41 | 3.44 | 3.23 | 3.31 | -0.07 | 1,604,259 |
| 10/28/2014 | 3.26 | 3.4 | 3.22 | 3.38 | 0.11 | 1,797,353 |
| 10/27/2014 | 3.5 | 3.5 | 3.16 | 3.27 | -0.23 | 2,183,994 |
| 10/24/2014 | 3.63 | 3.63 | 3.46 | 3.5 | -0.1 | 1,414,347 |
| 10/23/2014 | 3.66 | 3.71 | 3.59 | 3.6 | 0.03 | 1,659,003 |