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Tuesday, October 24, 2006

RIMM

Today there were important reasons for me to not trade. First off, I've gotten into the habit of entering my buy alerts into my trading acct. for the stocks that I'm interested in trading for the day. However, I was too tired to do that the night before, so I felt a bit unprepared. On top of the usual distractions at work, I also felt not quite mentally alert and focused for trading. If it weren't for my curiousity about how the Google calls were doing this morning, I probably wouldn't have woken up before market open.
So anyways, I just watched the usual suspects today (goog, akam, hans, ndaq, brcd, ise, etc.) not really intending to trade. Pretty soon, I saw something pop in one of the charts I was looking at. It was RIMM! My sentimental favorite for scalping on the TSX was actually having a decent volume break out! Since RIMM is one of the very few high profile, high volume dual listed stocks (listed RIMM on the NASDAQ and as RIM on the TSX), I naturally turned to the TSX ticker to see what was happening. Here's how my trade turned out:



Yup, it was right after I made that profitable scalp on the TSX that the thought occurred to me to check out the calls. Chart had a nice pullback, but behaved "nice" and orderly in the sense that no significant support levels were breached. As it started to bounce back from the pullback (note the decent volume), I went ahead and bought some calls in the afternoon.

3 comments:

Richard said...

So, when a stock is dual-listed, does it trade pretty much identically? Can you take advantage of some amount of lag between one and the other? Or are they merely similar? I never look at TSX quotes.

Phileo said...

Yes, because TSX:RIM trades lower volume, it does sometime lag its alter ego on the Nasdaq (or even overshoot it on one occasion that I observed). It's a totally separate and indpendent MM for the TSX market and that leads to slightly different fluctations. Based on my observations of just RIM and SU, I'd say these price deviations happen about 5%-ish of the time. It's pretty hard to profit from them though, because you also need to consider Forex (CAN$-USD$) fluctuations as well.

Phileo said...

sorry, make that about 10%-ish of the time, ie. these deviations occur approx. once every 2 wks or so.