How to Stop Limiting Yourself and Feel Fully Alive By Tania Yardley

“You can only grow if you’re willing to feel awkward and uncomfortable when you try something new.” ~Brian Tracy

I like my comfort zone and I hate it. It’s safe, but if I stay there too long it starts to feel like a cage. No wild creature is happy in a cage, and we’re all wild creatures at heart.

Sure, we like the reliability of being well fed, clothed, safe, and loved. It’s my theory though (formed just this second) that we are meant to hunt, to seek, to struggle, to engage with a world that offers no guarantees.

Like a caged animal, we become depressed when we play it too safe. “Safe” offers no challenge, no growth, and no newness. Without those things we wither and die inside; we watch too much TV, we eat junk food, we numb out.

Could it be that the prevalence of depression in First World countries is because our lives don’t challenge us as much as we need them to?

We all need exercise to be healthy. Muscles need to break to become strong. Do our hearts and minds also need challenge to thrive?

About eighteen months ago I got sick. It was a weird benign tumor that caused a lot of pain, enough pain that I took myself to hospital at three one morning.

Eventually, the tumor healed and the pain stopped. It didn’t go away; it just stopped hurting me. In the meantime, though, I became very careful, controlled, and I dropped out of my life. I felt afraid and limited. I lost faith in myself.

My world got very small and I became too dependent on those close to me. I was not much fun. I lost friendships.

Now I am rebuilding. It’s not always easy, but I’m on the way back.

I can now see that my comfort zone isn’t comfortable. My fears and limitations have drawn the boundaries of my life, and that’s a small cage to live in.

That’s not how I want to live. I remember more lively times and I want that power and flow back. I want to break through the darkness into the bright light, where life is colorful again.

I want my life back.

If you also need to expand your comfort zone, you may benefit from applying these lessons that are helping me:

1. Get honest.

Ask questions. Get really clear on what is true for you. What do you think? What do you feel? What do you want? What is useful? What’s the truth?

Truth can be hard to take, but it puts you on solid ground. You can walk forward on solid ground.

For me, right now I am “calling myself out” on the lie that I lack the power to make changes.

2. Change is possible.

We can make changes. You may have had a vibrant life before and you can make one again. Know you can change and try new things.

When I decide I’m a victim, it’s a lie. It is just not true. Granted, while I was sick change may have been too hard, but that’s not true anymore.

3. Change is uncomfortable, and that’s okay.

It doesn’t come without risk. We can’t stay in our comfort zones and expand at the same time. Growing is going to be uncomfortable. It’s even going to feel wrong. Do it anyway.

The only way to get a bigger comfort zone is to do things outside it until they don’t scare you anymore. Then repeat.

4. Change happens step by step.

Changes seem big when you start out, but they’re just a series of small steps. They’re just a tiny set of actions. They’re the sum of the things you do, day by day.

A slight change in trajectory is a huge change over time. It doesn’t happen all at once.

5. Explore possibility.

Every day, write a list of things that may take you in the direction you want to go. Write a list of ways to expand your life. Write a list of solutions. Write a list of “could do’s”.

You don’t even need to keep the lists. The good ones will stick. They’ll pop up again and again like your favourite muppet.

6. Take one tiny risk a day.

Set yourself one tiny risk. Commit to doing it. That means you have to do it. No second-guessing. You said you would do it; you’re doing it! It may not be the “right” action, but that’s irrelevant. It’s the thing you chose to try.

7. Every action is an experiment.

Not every little risk will pay off, but that’s life, that’s learning. Every action will teach you something.

I did well in school; it’s taken me a long time to get comfortable with failing and actually “learning to learn.” The school of life is a better teacher and a tougher one. That’s my school right now.

8. Courage is more important than success.

I heard Brené Brown say, “Being courageous is more important than being successful.” I have that on my wall. I think it’s true. Taking small risks makes me feel alive. The other name for “fear” is “thrill.”

9. Risk develops resilience.

We gain resilience with practice by striving, failing, and getting up again. It’s how we build emotional muscle. Sure, have a cry, share your humiliations with a trusted someone, then get back up and take the next step. Being courageous feels scary and good.

And so, right now, I extend invitations knowing I may be rejected. I commit to writing projects that may not be published. I open up more to those closest to me and really let them in.

I open up my world one step at a time, and it’s scary and it’s thrilling. The colors are brighter at the edge of my comfort zone.

I am learning that my fears are false dragons guarding the gold. The dragons look real, but really, only the gold is.

10 tips for overcoming the fear of being bold

I’m working on being bold – whether it’s in a one on one conversation or in a presentation. In the past, I’ve often watered down what I say to avoid upsetting anyone. And I’m not alone. Many of the people that Icoach are concerned about being bold. As a result, they dilute their message so much that they have zero impact on their audience.

Cultivate an attitude of boldness

Being bold is not something that you can “pull out of a hat” when you’re giving a presentation or speech. You need to develop an attitude of speaking out in your day to day life. Otherwise you won’t develop the courage to be bold in your presentations. Practice saying what’s on your mind when you’re with just one other person or a small group.

I’ve found blogging to be extremely useful in helping me be bold. Some posts I’ve written have taken me some time to publish because of my fear, but having done so I’m bolder. Here are some thoughts to help you develop an attitude of boldness in everyday life.

1. Stop being nice

What stops me being bold is that I want to be liked, I want to be nice. I don’t want to have to deal with anyone being upset or offended by what I’ve said. It’s worked for me in many ways, but it holds me back too. I keep this quote on a post-it above my desk:

2. Saying what you think enhances your career

Do you hold back saying what you think because you want to make sure that everything you say makes perfect sense and is supported by evidence? Me too. But research shows that people who speak up more are seen as leaders. Now that makes sense, but here’s the topsy-turvy kicker – what they said didn’t have to be particularly brilliant or clever or original. So don’t worry about being perfect, just speak up.

3. Not saying what you think annoys people

I’ve sometimes held back on saying what I think fearing that it will upset people. Then the situation deteriorates and I end of saying what I think, only to be told “Why you didn’t tell me that earlier?”

4. Your ideas can help other people

Do you think your ideas are not worth sharing, that they’re obvious. Then watch this gorgeous, short video (H/T Rich Hopkins):

5. What’s the worst that can happen

Sometimes when I want to say something bold, I stay silent because I just imagine a nameless disaster. But if I think it through  and ask myself “What’s the worst thing that could happen?” then I realise that the worst that will happen is that the person I’m speaking to might be upset for a day. Can I handle that? Yes, I can! And then often they don’t even get upset for five minutes. They just thank me for being straight! Often the consequences that we fear from being bold don’t materialise.

How to be bold in your presentations

Here are some tips for developing boldness in your presentations:

1. Ask your audience to take action

Just giving your audience information is the safe option. But what does it accomplish? Instead, answer this question:

“What do you want your audience to do with the information you’re giving them.”

Then use your presentation to persuade people to take that action.

For example, in my presentation on Kiva (see my Guide”How to make an Effective PowerPoint Presentation”) I could say to the audience:

“Lending money to poor people is an effective way of helping them.”

It would be interesting information, but I haven’t accomplished anything. Instead I say:

“Lend $25 to a poor person so they can start a business.”

2. Be provocative

In my research on learning styles I came across Frank Coffield, an academic challenging the prevailing mythology of learning styles in education. He said he was inspired by Karl Popper, who wrote in his autobiography:

‘My custom, whenever I am invited to speak in some place, of trying to develop some consequences of my views which I expect to be unacceptable to the particular audience. For I believe that there is only one excuse for a lecture: to challenge. It is the only way in which speech can be better than print’. (Unended Quest Open Court Publishing Company, 1976, p 124)

A friend said to me yesterday “If you don’t miss at least one plane a year, you’re arriving at the airport too early!” Now, I’m not going to change my habit of arriving at the airport in plenty of time, but I can see his point. Similarly, “If you’re not provoking at least one person in your audience, you’re being too nice.”

3. Imagine the friendliest audience

Imagine what you would dare to say if you knew that the audience were the friendliest most supportive bunch of people. That they’re already on your side. Now say that.

4. Express the main point of your presentation in one succinct sentence

If you’ve been reading my blog for a while, you know that I call this your Key Message. The work of crafting your point into a Key Message has you think through what you really want to say. If you allow yourself several sentences to express your point, you’re likely to have woven all sorts of qualifications and caveats. So don’t. Say it in one clear and succinct sentence.

5. Get rid of weasel words

Do you pepper your phrases with weasel words and phrases? Like “I’d just like to” or “sort of” or “kind of”. They reduce the power and boldness of your ideas. You may not know you’re doing this. So either record yourself and listen back, or ask a friend to give you feedback.

Stop holding back – be bold. You’ll get your message across, spread your ideas and enhance your career.

7 Things Really Bold People Do

"Whatever you can do, or dream you can do, begin it.
Boldness has genius, power, and magic in it!"

The day I went off to college, a friend gave me this quote, which is questionablyattributed to Johann Wolfgang von Goethe. Over the years, it has inspired me, and I have seen it posted on the walls and bulletin boards of many entrepreneurs and leaders.

Bold people stand out from the group. They are confident, courageous, and directed. I believe there is boldness in most people. Given the right set of circumstances, many will take action to better the world around them.

People who choose to be bold are inspiring not just because they get big things accomplished, but because they also instigate growth, progress, and movement for themselves and others around them. Sadly, far more people wait for someone who is bold to lead the way, hoping somehow luck will shine success upon them.

Perhaps it's time to unleash the bold leader in you. Try adding these seven actions to your daily repertoire, and see how much faster the magic of boldness takes you toward success.

1. They own their flaws and strengths. There is a difference between boldness and carelessness. Bold leaders have strong self-awareness. They know when they should take bold action and when they are out of their element. They minimize the risk for themselves and others by constantly reassessing themselves and engaging others to accommodate for personal weakness. Want to be a bold leader? Be more self-aware. Engage others who can complement your strengths and compensate for your weaknesses.

2. They keep clear priorities. Someone who constantly jumps into action without a plan isn't bold, just foolish. Bold people know their objectives and prioritize them clearly. They can afford to be bold because they can recognize the right opportunitywhen it comes along. Want to be a bold leader? Know clearly what you need to accomplish and seek those chances that will move the team forward. Avoid unimportant activities that lead to distraction.

3. They speak up. Bold people are not necessarily loud or boisterous, but when they have something to say, they say it. More important, they understand when and how to say it. Being bold does not equal being a bully or a loudmouth. Bold leaders must be better at tact and empathy, because the very nature of their words will carry power and impact. Bold leaders also understand that silence is often the greatest statement one can make, and they use it judiciously. Want to be a bold leader? Say what needs to be said before the silence derails the team.

4. They pair action with knowledge. Even though bold leaders are prone to action, they are rarely considered rash. They apply the same sense of action to learning and due diligence as they do to any other activity. Bold leaders want to make sure their actions lead to success, so they investigate before leading their team to the charge.Want to be a bold leader? Improve your odds of success by doing your homework. You'll increase your confidence and your success rate.

5. They accept the value of failure. No one is totally comfortable with failure, but bold leaders understand that greater rewards stem from greater risk. Still, they know how to mitigate catastrophic risk and how to protect their team. Bold leaders also know how to use risk to their advantage. They harness the energy and adrenaline and make sure that every failure is a learning opportunity. Want to be a bold leader? Make failure an acceptable part of your process. Teach the team how to assess and limit risk, so missteps can happen without total destruction. Then get people to learn and reboot.

6. They make the most of small wins. Many people sit and wait around for the "right opportunity" before they are willing to step up and take action. Sadly, sometimes that right opportunity never comes. Bold people understand that rarely is any situation perfect from the beginning. They look to make the most of any given set of circumstances that can lead to victory, even a small one. Cumulatively, consistent little wins spell success, attracting followers. Want to be a bold leader? Start with a small battle you think you can win, map out a plan, and take the field. Winning builds confidence as well as your reputation.

7.  They build momentum. Bold people recognize that a single victory is not enough to sustain leadership. They work to create a series of actions that help the team gather confidence, speed, and power. They have a sense of when to add energy to drive forward and when to let the momentum itself carry things forward efficiently. Want to be a bold leader? Craft your plan so that each action takes advantage of the success from the last. Take advantage of any win that gains attention, respect, and popularity. Activate your fans, cultivate relationships, build buzz. Don't coast!

把自己还给自己

人生苦短，为什么要在活着的有限时光自我折磨？为什么要患得患失，活得像一只惊弓之鸟，痛苦莫名？谁有精力成天处心积虑地去讨好别人、适应别人？

人很少是为自己活着

生命中有一种轻，比重还难负荷。那就是——失落自我，为别人活着。人很少是为自己活着，不是为所爱的人就是为所恨的人或其他无关紧要的人而活着。人的一生就是失去散灭。无奈之感常逼使我们在意旁人，疏忽自己。

有很多时候，我们下意识地在一隅用旁人的目光与口型来束缚自己，以至踌躇不前，以至无法执着于自己的方向。大事小事都要顾虑到旁人的看法，如同缆绳自缚，最终受苦的还是自己，弄得自己神经不能松弛，使自己无端受到许多纷至沓来的烦恼践踏。

人生苦短，为什么要在活着的有限时光自我折磨？为什么要患得患失，活得像一只惊弓之鸟，痛苦莫名？谁有精力成天处心积虑地去讨好别人、适应别人？

受约束的是心情，没有约束的是生命

生命是自己的，生活也是自己的，我们不应该为负担别人的目光而生存。可见，不是世界不给我们轻松，是我们自己亲手扼杀了轻松。是思想、是物质、是种种欲望的因素，是我们失去了品尝生活乐趣的兴致与品味。

这个世界最缺的是两样东西：从容与友情。由于缺少从容，我们很难见到步履雍容、乾坤朗朗的人；因为缺少友情，难得遇到品格高旷、情趣盎然的人。这世间，只有一个人能够跑到你背后，去追寻你身影里的落寞与痛苦——那就是你自己。

想着依赖什么，是很惊险的想法。自己才是自己皈依处——那是你内在的空明状态。你是自己的囚徒，还得靠自己去释放。当意识到不自在的时候，你便有了自在。希腊特菲尔神庙门上有一句名言：认识你自己！

把自己还给自己

让我们以生命之火点燃自己，去找回失落已久的自我。重新认识之后，在人生的大旷野中，确立属于自己的品质与风格。施以合体的心理引导，卧则高枕无忧，立则挺拔伟岸，行则昂头走自己的路，随别人怎么说。没听说：“芭蕉叶上无愁雨，只是听时人断肠”？没听说：“若无闲事挂心头，便是人间好时节”？

古诗也这样说：“半亩方塘一鉴开，天光云影共徘徊。问渠那得清如许，为有源头活水来。” 什么才是我们生存方塘的源头活水？懂得爱、爱人、自爱的心，就是那半亩方塘。敢爱、敢恨，从容淡定的真性情就是那源头活水。

把自己还给自己，这才是正确的生存姿态。这样的人生才算是——痛快的人生。

像捉迷藏一样，人生的功课之一就是找自己。才懂了一点，却发现不懂的更多。关于成长，似乎没有一劳永逸的事儿，只有不停的痛，愈合，找个角落舔舐伤口；接着又痛……如此往复中，渐渐找回那个藏在角落的自己，并且爱上她。

节奏太快工作太累，我们都需要一片让自己心灵平静的空地栖息。每晚利用碎片时间读一本好书，品一段美文，时时提醒自己，无论走得多远，都勿忘初心。

多读书，读好书，愿我们都能被这个世界温柔对待。

Scientists Used Game Theory To Prove That Being Selfish Pays Off

As cynical as it sounds, the selfish find success in life.

So concludes a new study published Monday in the Proceedings of the National Academy of Sciences. Building on other studies of the "prisoner's dilemma" and "game theory," or the study of decision-making, the researchers, Joshua Plotkin and Alexander Stewart from the University of Pennsylvania, found that self-interest pays off. While the study focuses on the theoretical mathematics behind general evolution, the same trends could apply to human thinking. 

Last year, Plotkin and Stewart conducted similar research, determining that evolution actually favors altruism. The new study, however, adds a twist. The model not only allows "players" to alter their strategies, but also their rewards. The results showed the exact opposite — that in the long-run, cooperation tends to collapse. 

"It's a somewhat depressing evolutionary outcome, but it makes intuitive sense." said Plotkin, a professor of biology in the School of Arts & Sciences.

How It Works

The Prisoner's Dilemma works like this: Two "players" commit a crime and how they behave during questioning determines their punishment. When a player "defects," he or she betrays his or her partner. "Cooperating" means keeping quiet.

If X defects against Y, X avoids jail altogether while Y gets three years behind bars — bad for one and very good for the other. If both criminals defect, they each receive two-year sentences. Lastly, if both cooperate, they'll each spend only one year in jail, the largest mutual payoff.

According to the Nash Equilibrium, named after Nobel Prize recipient John Nash (of "A Beautiful Mind" fame) in reality, most people do snitch on their partners. People simply don't trust each other to keep quiet.

When the game continues for multiple rounds, players can employ different strategies to achieve the greatest benefit. As they learn more about how their partners behave, players can alter their approaches to achieve the greatest payoff in the end. Therefore, players' decisions greatly affect other players' future strategies.

While organisms in nature don't necessarily make decisions the way prisoner's facing interrogation would, the natural world still includes trade-offs. For example, a smaller, weaker male in a species could somehow help a larger, stronger male breed with a female, ensuring the next generation has the best chance of survival. Or the less advanced male could try and mate with the female himself, furthering his line while potentially harming the overall species. 

New Findings

Plotkin and Stewart's original study explained how these principles of generosity and cooperation would have evolved in nature. When costs increased, cooperation did as well — a linear relationship. When the researchers upped the variables, however, the benefits of a more selfish mindset became apparent. 

While the prevalence of cooperation quickly arises in populations with the power to determine how frequently to cooperate, that sentiment soon collapses when players can also determine to what extent they work together. Plotkin and Stewart found a mathematical tipping point, where the hypothetical players favored defection, time and again. 

"When cooperative strategies predominate, payoffs will rise as well," Stewart said. "With higher and higher payoffs at stake, the temptation to defect also rises. In a sense the cooperators are paving the way for their own demise."

As a next step, the marine bacteria Vibrionaceae could provide a real-world example to back this theory up. This species cooperates by sharing a protein they release which allows them to metabolize iron. The bacteria, however, sometimes mutate to alter whether they generate it and how much — a "natural experiment" for Stewart and Plotkin's theory. 

While this creates a bit of a depressing view of evolution, it also makes more sense in nature, according to the researchers. 

What To Do When Your Options Trade Goes Awry

Successful options trading is not about being correct most the time, but about being a good repair mechanic. When things go wrong, as they often do, you need the proper tools and techniques to get your strategy back on the profit track. Here we demonstrate some basic repair strategies aimed at increasing profit potential on a long call position that has experienced a quick unrealized loss.

Defense Is Just as Important as Offense
Repair strategies are an integral part of any trading plan. I always review a well thought-out set of "what-if" scenarios before putting any money at risk. Too often, though, beginner options traders give little thought to potential follow-up adjustments or possible repair strategies before establishing positions. Having a great strategy is important, but making a profit is highly correlated with how well losing trades are managed. "Play good defense" is my options-trading mantra.

Fixing a Long Call
Many traders will buy a simple call or put only to find that they were wrong about the expected movement of the underlying stock. An out-of-the-moneylong call position, for example, would experience immediate unrealized losses should the stock drop. What should the trader do in this situation?

Let's examine a simple long call example, which demonstrates a concept that you can apply also to a long put. Suppose it is currently the middle of February and we believe that IBM, which at 93.30, is poised to make a move aboveresistance (the upper green line in Figure 1) at about 95. We have good reason to jump in early with the purchase of a July 95 near-the-money call. With about 150 calendar days left until expiration, there is plenty of time for the move to occur.

Figure 1 – IBM daily price chart showing medium support/resistance levels.

But suppose, not long after we enter the position, IBM gets a downgrade and drops suddenly, perhaps even below medium-term support at 91.60 (the lower green line in Figure 1) to about 89.34. The price of the July 95 call would now be worth about $1.25 (assuming some time-value decay), down from $3, rendering an unrealized loss of $175 per option. Figure 2 presents the profit/loss profile of this trade.

Figure 2 – IBM July 95 long call profit/loss.

With so much time remaining until expiration, however, it's still possible that IBM may reach and surpass the strike price of 95 by Jul 16, but waiting could add additional losses and present additional opportunity costs, which result from our forgoing any other trade with profit potential during the same period.

Initial IBMPrice	July 95 Call Purchase Price	Lower IBM Price	Lower July 95 Call Price	July 90 Call Price
93.30	$3.00	89.30	$1.25	$2.75
Table 1 – Options prices before and after IBM price change.

One way to address unrealized loss is to average down by purchasing more options, but this only increases risk should IBM keep falling or never return to the price of 95. Actually, the breakeven on the original July 95 call, which was purchased for $3, is 98. This means that the stock would have to rise by nearly 10% to get to the breakeven point. Averaging down by purchasing a second option with a lower strike price, such as the July 90 call, lowers the breakeven point, but adds considerable additional risk, especially since the price has broken below a key support level of 91.60 (indicated in Figure 1).

One simple method to lower the breakeven point and increase the probability of making a profit without increasing risk too much is to roll the position downinto a bull call spread. This is a strategy presented by options educator, Larry McMillan, in his book, "Options as a Strategic Investment", a must-have standard reference on options trading.


To implement this method we would place an order to sell two of the July 95 calls at the new price of $1.25, which amounts to going shortthe July 95 call option since we are long one option already (selling two when we are long one, leaves us short one). At the same time, we would buy a July 90 call, selling for about 2.90. Table 2 presents the price details:

Transactions	Debits/Credits	Cumulative Net Debits/Credits
Buy July 95 call	-$300	-$300
Sell 2 July 95 calls	+$250	-$50
Buy 1 July 90 call	-$275	-$325
Table 2 – Transaction details of rolling down into a bull call spread

The net result of this adjustment into a bull call spread is that our total risk has increased only slightly, from $300 to $325 (not counting commissions). But our breakeven point has been lowered considerably from 98 to 93.25, a drop of 4.75%.

Suppose now that IBM manages to trade higher, back to the starting point of 93.30. Our bull call spread would now be just above breakeven, with a potential profit as high as 95, although limited to just $175 per option. We have, therefore, lowered our breakeven point without adding much additional risk, which makes good sense.

Alternative Repair Approach
Another repair attempt (which can perhaps be combined with the one above) is to roll down into a butterfly spread when IBM falls to 90. With this strategy we sell two July 90 calls, which would be going for about $4 each, and keep the July 95 long call, and then buy a July 85 call for about $7.30 (assuming a little bit of time-value decay in these numbers).

Transactions	Debits/Credits	Cumulative Net Debits/Credits
Buy July 95 Call	-$300	-$300
Sell 2 July 90 Calls	+$800	+$500
Buy 1 July 85 Call	-$730	-$230
Table 3 – Transaction details for roll to a butterfly spread.

The total risk actually decreases on the downside since the total debits fall to $230, but there is some limited upside risk should IBM move back above 92.65 (breakeven). If IBM goes nowhere, however, the trade actually produces a nice profit, occurring between 87.30 and 92.65. The profit/loss table below presents our different scenarios for this repair strategy:

IBM Price At Expiration	Profit/Loss
85.00	-$225
87.30	Breakeven
90.00	+$264
92.65	Breakeven
95.00	-$235
100.0	-$235
Table 3 – Profit/loss details for butterfly spread repair strategy.

Meanwhile, maximum potential losses are $235 (upside) and $225 (downside). Maximum potential profit is at 90 with $264, and profit decreases marginally as you move toward the upper and lower breakeven points, as seen in Figure 3.

Figure 3 – Butterfly Profit/Loss Profile

Combining the Repair Strategies
Since this is a butterfly spread, maximum profit by definition is at the strike of the two short calls (July 90 calls), but movement away from this point eventually leads to losses. Therefore, the best overall approach might be to mix our two repair strategies in a multi-lot repair approach. This combination can preserve the best odds of producing a profit from a potential loser: the bull call-spread repair has a profit from 93.25 up to 95. And, there are ways to adjust a butterfly spread given moves of the underlying (a topic that would require a separate article).

The Bottom Line
We've looked at two ways (which might best be combined) to adjust a long call position gone awry. The first involves rolling down into a bull call spread, which significantly lowers overhead breakeven while preserving reasonable profit potential (albeit this potential is limited, not unlimited as in the original position). The cost poses only a tiny increase in risk. The second approach is to roll into a butterfly spread by keeping our original July call, selling two at-the-money call options and buying an in-the-money call option. Whether used alone or in tandem, these repair strategies offer some flexibility in your trading plans.

There will always be losses in options trading, so each trade must be evaluated in light of changing market conditions, risk tolerance and desired objectives. That said, by properly managing the potential losers with smart repair strategies, you stand a better chance of winning at the options game in the long run.

Fix Broken Trades With The Repair Strategy

Investors who have suffered a substantial loss in a stock position have been limited to three options: "sell and take a loss", "hold and hope", or "double down". The "hold and hope" strategy requires that the stock return to your purchase price, which may take a long time if it happens at all.

The "double down" strategy requires that you throw good money after bad in hopes that the stock will perform well. Fortunately, there is a fourth strategy that can help you "repair" your stock by reducing your break-even point without taking any additional risk. This article will explore that strategy and how you can use it to recover from your losses.

Defining The Strategy
The repair strategy is built around an existing losing stock position and is constructed by purchasing one call option and selling two call options for every 100 shares of stock owned. Since the premium obtained from the sale of two call options is enough to cover the cost of the one call options, the result is a "free" option position that lets you break even on your investment much more quickly.

Here is the profit-loss diagram for the strategy:



Copyright © 2008 Investopedia.com


How To Use The Repair Strategy
Let's imagine that you bought 500 shares of XYZ at $90 not too long ago, and the stock has since dropped to $50.75 after a bad earnings announcement. You believe that the worst is over for the company and the stock could bounce back over the next year, but $90 seems like an unreasonable target. Consequently, your only interest is breaking even as quickly as possible instead of selling your position at a substantial loss. (For more strategies to get back on track, readWhat To Do When Your Trade Goes Awry.)

Constructing a repair strategy would involve taking the following positions:
Purchasing 5 of the 12-month $50 calls. This gives you the right to purchase an additional 500 shares at a cost of $50 per share.
Writing 10 of the 12-month $70 calls. This means that you could be obligated to sell 1,000 shares at $70 per share.

Now, you are able to break even at $70 per share instead of $90 per share. This is made possible since the value of the $50 calls is now +$20 compared to the -$20 loss on your XYZ stock position. As a result, your net position is now zero. Unfortunately, any move beyond $70 will require you to sell your shares. However, you will still be up the premium you collected from writing the calls and even on your losing stock position earlier than expected.

A Look At Potential Scenarios
So, what does this all mean? Let's take a look at some possible scenarios:
XYZ's stock stays at $50 per share or drops.
All options expire worthless and you get to keep the premium from the written call options.
XYZ's stock increases to $60 per share.
The $50 call option is now worth $10 while the two $70 calls expire worthless. Now, you have a spare $10 per share plus the collected premium. Your losses are now lower compared to a -$30 loss if you had not attempted the repair strategy at all.
XYZ's stock increases to $70 per share.
The $50 call option is now worth $20 while the two $70 calls will take your shares away at $70. Now, you have gained $20 per share on the call options, plus your shares are at $70 per share, which means you have broken even on the position. You no longer own shares in the company, but you can always repurchase shares at the current market price if you believe they are headed higher. Also, you get to keep the premium obtained from the options written previously.

Determining Strike Prices
One of the most important considerations when using the repair strategy is setting a strike price for the options. This price will determine whether the trade is "free" or not as well as influence your break-even point.


You can start by determining the magnitude of the unrealized loss on your stock position. A stock that was purchased at $40 and is now trading at $30 equates to a paper loss of $10 per share.

The option strategy is then typically constructed by purchasing the at-the-money calls (buying calls with a strike of $30 in the above example) and writing out-of-the-money calls with a strike price above the strike of the purchased calls by half of the stock's loss (writing $35 calls with a strike price of $5 above the $30 calls).

Start with the three-month options and move upwards as necessary to as high as one-year LEAPS. As general rule, the greater the loss accumulated on the stock, the more time will be required to repair it. (Keep reading about LEAPS in Using LEAPS In A Covered Call Write.)

Some stocks may not be possible to repair for "free" and may require a small debit payment in order to establish the position. Other stocks may not be possible to repair if the loss is very substantial - say, greater than 70%.

Getting Greedy
It may seem great to break even now, but many investors leave unsatisfied when the day comes. So, what about investors who go from greed to fear and back to greed? For example, what if the stock in our earlier example rose to $60 and now you want to keep the stock instead of being obligated to sell once it reaches $70?

Luckily, you can unwind the options position to your advantage in some cases. As long as the stock is trading below your original break-even (in our example, $90), it may be a good idea so long as the prospects of the stock remain strong.

It becomes an even better idea to unwind the position if the volatility in the stock has increased and you decide early in the trade to hold on to the stock. This is a situation in which your options will be priced much more attractively while you are still in a good position with the underlying stock price.

Problems arise, however, once you try to exit the position when the stock is trading at or above your break-even price: it will require you to fork over some cash, since the total value of the options will be negative. The big question becomes whether or not the investor wants to own the stock at these prices.

In our previous example, if the stock is trading at $120 per share, the value of the $50 call will be $70, while the value of the two short calls with strike prices of $70 will be -$100. Consequently, reestablishing a position in the company would cost the same as making an open-market purchase ($120) - that is, the $90 from the sale of the original stock plus an additional $30. Alternatively, the investor can simply close out the option for a $30 debit.

As a result, generally you should only consider unwinding the position if the price remains below your original break-even price and the prospects look good. Otherwise, it is probably easier to just re-establish a position in the stock at the market price.

Conclusions
The repair strategy is a great way to reduce your break-even point without taking on any additional risk by committing additional capital. In fact, the position can be established for "free" in many cases.

The strategy is best used with stocks that have experienced losses from 10% to 50%. Anything more may require an extended time period and low volatility before it can be repaired. The strategy is easiest to initiate in stocks that have high volatility, and the length of time required to complete the repair will depend on the size of the accrued loss on the stock. In most cases, it is best to hold this strategy until expiration, but there are some cases in which investors are better off exiting the position earlier on.

人活着 不一定要别人来认可

人生最大的自由之一就是：不再在乎别人对你的评价。

有时，你需要步出熙熙攘攘的人群，呼吸一番新鲜空气，并提醒自己：我是谁?我想成为什么样的人？最美妙的事情就是听从自己内心的呼唤，勇于挑战。不要再因担心别人的看法或者畏惧未知的事情，而被动接受安乐窝里的选择。只要你去做，一切都会安好!不要让那无关紧要的琐事，羁绊自己的思路，误以为自己的梦想太过虚幻——不是那么回事。

从今天开始，别再等待别人的认可。这里告诉你8个为什么！

1、人生在世，你只有这一次生命可以追逐自己的梦想。

去做自己喜欢的事情，即使失败，也胜于在自己讨厌的事情上取得成功。所以请把握机会，追逐自己心的梦想，屡败屡战，直到成功。勇于牺牲，勇于走出舒适的避风港，一次次搏击人生。满载勇气和激情，直视你的恐惧。坚守自己的梦想，并努力把它付诸现实。

2、别人的认可只是别人的观点。

不要让别人的想法决定你的人生。永远不要忘记自己是谁，不要放弃自己的梦想，因为没有人比你更清楚这些。呵护自己的内心的选择，风雨无阻的前行。不经你的允许，没有人可以轻视你。你是自己梦想和幸福的唯一主宰。

3、唯一值得在乎的是你自己的想法。

实际生活中，放弃别人眼中完美的自己，开始起航真正的自我，是一件相当艰难的事情，但也很是意义非凡的抉择。所以，让自己的爱好自由飞翔。因为，爱好决定梦想，梦想决定行动，行动最终将决定你的命运。

4、有些人永远不会认可你。

不要让别人否认的目光扰乱你内心的平静。这世上有两种人：一种人会消耗你的能量和创造力;另一种人会给你能量，支持你的创造，或者只是一个简单的微笑。拒绝第一种人。让自己快乐起来，去做自己想做的人。有人不喜欢，由他去吧。快乐是一种选择—你的选择！活着不是为了取悦他人。

5、每个人生命的旅程和前途是完全迥异的。

让你与众不同的一点就是：你是谁。不要为了任何人轻易改变自己的本质。未来永远是一个谜，不要害怕探索，求知，不要害怕成长。该来的总会来，只管迈开大步，勇敢前行。假如生活欺骗了你，站起来，要越挫越勇。当你面临需要抉择的岔路口时，做出让自己不会后悔的选择。

6、亲身体验通常是成长所必须的。

关于生活的经验只有通过你自己的实践之后，才能转化成你的智慧。所以，要去尝试并积累经验，而不是依赖别人的意见。这种亲身的体验，可以让你更加理智的思考，然后朝着正确的方向，更加成熟稳重的前进。

7、你的直觉无需别人认可。

当现实需要考验你内心的智慧时，一定要去尝试自己想要尝试的东西，去自己想去的地方，相信自己的直觉。不要接受错误的建议，不要让别人困扰你的想法。如果自我感觉良好，就去做吧，否则你永远也不会知道结局会有多么完美。乔布斯就讲过：“不要让别人的议论淹没你内心的声音，你的想法，和你的直觉。因为它们已经知道你的梦想，别的一切都是次要的。”

8、生命短暂，经不起等待。

假如你很确定自己得了不治之症，假如你已经感觉时间紧迫，那你真的没有时间可以浪费了！清醒吧，面对这样一个紧迫的现实，你没有时间可以等待——无人例外！环顾四周，看看人生的奇迹曾带给你怎样的礼物。选择快乐，别再等待别人的认可——否则你永远没有机会快乐！

为什么我们那么努力，却得不得自己想要的结果，是因为我们没有找到有用的方法，我们想在最短的时间内帮助更多的人，完成自己心目中的梦想，实现中国梦，我们将无偿提供千份内部学习光碟，数量有限。

經典投資書《漫步華爾街》 40年來不敗

這是一本出版 將近40年的經典投資指南，

常為美國著名大學MBA投資學課程的指定參考書。

書中提供 完整的投資理論，

即使是股市門外漢，也能輕鬆讀懂 投資市場的理論與工具，

並幫助一般投資人找到屬於自己的投資理財方法。

本書的作者是墨基爾 (Burton G. Malkiel)，

他是一位 研究證券市場和投資行為的經濟學者，

現在是 美國普林斯頓大學 經濟學教授，

曾是 投資分析 及 投資組合管理 的 專業人士，

此外，他也是個終生投資且成功的股市投資人。

不報明牌，而是建立大家正確的投資觀

作者在出書後的40年間，把自己提供的投資策略做驗證，

因此，他對自己的投資理論很有信心，

作者希望對投資有興趣的所有人，都能找到屬於自己的投資道路．

建立「正確」的投資觀念。

首先，簡單介紹 3大投資理論

1. 磐石理論（基本分析）：運用過去公司的資訊，計算股票真實價值

磐石理論(firm-foundation theory)認為，

「用過去資訊和未來展望，可以計算出股票或房地產的真實價值。」

也就是一般基本面分析所提到的，

買入市價低於真實價值的股票，賣掉市價高於真實價值的股票。

著名的巴菲特，就是遵行磐石理論。

（圖片來源：網路）

2. 空中閣樓理論（技術分析）：比別人搶先一步，買到賺錢標的

空中閣樓(castle-in-the-air)理論 強調心理因素，

因為聰明的投資人要做的，就是比別人搶先一步買到日後能賺錢的標的。

作者認為這就是一種「比傻理論」，

因為你大可付3倍的價格買進，

只要稍後找到傻瓜願意出5倍的價格，你就能獲利。

一般我們所說的技術分析，就是認同空中閣樓理論，

他們透過製作股價圖，並加以解釋。

把投資視為 猜測其他參與者行為的遊戲。

（圖片來源：網路）

3. 隨機漫步理論：過去的資訊，無法預測未來

隨機漫步理論(random walk theory) 是由學術界所提出，

他們認為，「只要是過去的資訊與行為，都無法預測未來。」

就像是 一隻矇著眼睛的猴子，對著眾多股票隨意擲飛鏢，

所挑選出來的投資組合，也會跟專家挑的組合一樣好。

所以這個理論，對分析師來說 非常諷刺！

實證顯示，隨機漫步理論才符合市場狀態

股價變動快速，想靠短期預測獲利是不可能的 

在上面3個理論中，作者信奉的是隨機漫步理論，

他透過驗證告訴你，

股價變動像漫步，你沒辦法預測股價變動的方向。

因為股市很有效率，所以當新消息剛來的時候，

股價變動非常快速，快到沒有人每次都能迅速從中獲利，

股市就像醉漢一樣，是隨機漫步的狀態，

所以想要靠 短期預測 來 投資獲利是不可能的！

在隨機漫步般的市場，應建立投資組合，分散風險

由於經過實證，市場就像醉漢的隨機漫步一樣，

很難預測股價變動的方向，

所以應該建立投資組合，幫助你分散風險，

才不會在某些產業環境波動時，因為只投資單一資產或產業而損失慘重。

投資理論都假設人是理性的，但實際並非如此

前面所提到的投資理論，都是建立在「人是理性的」的前提下，

但人常常是不理性的，在投資上更是明顯。

當你在買股票時，只要賺錢你就會很快賣掉，

只要賠錢卻會捨不得賣，這就是一種投資上不理性的行為。

台股在2008年，也曾出現人們這樣不理性的行為！

當時大盤達到9000點，但那時很多人都說股市還會上到萬點，

不怕死的投資人就一窩蜂的搶進，

但沒想到過不久，就發生金融海嘯，

台股連帶受影響，短短6個月，大盤掉到4000點。

（資料來源：CMONEY主程式）

提醒你，要避免6個不理性行為：

(1) 避免從眾行為

某時期最熱門的股票或基金，在下一個時期總會變成表現最差的。

(2) 避免交易過度頻繁

過度交易要負擔很多的手續費、風險、交易稅等交易成本，

所以巴菲特說「懶惰是最佳的投資模式」。

(3) 如果你已進場：賣掉賠錢股、不賣賺錢股

每個投資人都會說自己害怕風險，

但往往在進場時，

你卻願意冒著比獲利更大的風險，去避免損失。

(4) 提防新上市股(IPO)

每每有 新股上市，報章媒體 總是一片喜氣，

許多股票 會趁這段時間大漲，

搶買進的人，首日尾盤通常可以買到，

但新股票容易上演 主力倒貨給散戶的劇碼，

因此，搶買進的勝率基本上很慘...

(5) 不要輕信小道消息

誤信小道消息，或是新聞媒體的渲染，

看到股票出現高點 就忍不住追高，

結果可能忽然轉跌，讓你出現鉅額損失。

(6)不要相信任何完美計畫

投資人千萬不能忘記這句格言，

「如果有甚麼事情好到不像是真的，那可能就不是真的。」

真心推薦《漫步華爾街》給所有投資人，

幫助大家建立正確的投資觀

看完了這篇文章你可能會問：「既然作者認為隨機漫步理論才是正確的，

那 遵循磐石理論的巴菲特 為什麼可以成功？ 」

因為這本書針對的是一般的投資者，

而巴菲特比起一般投資者有更大獲得訊息的管道，

導致投資成效超過一般投資者，

但是他們的情況不適用於一般投資者，

因此，這本書希望能幫助一般投資者建立正確的投資觀念。