My Activision Blizzard trade

Nevertheless, I wanted to get in a trade that I might score a buck or two from. After studying many situations, I decided to use Activision Blizzard. Nothing in the rule book says you can't use an equity as an instrument for both trading and investing. So I bought in almost two weeks ago at $12.46. In my opinion, the stock would see at least a dollar move shortly.

Well, I was wrong. Activision Blizzard was not going up a buck. I could tell by the subsequent price action. Well, let me amend this statement. I guessed by the subsequent price action that Activision Blizzard wasn't necessarily heading higher by such an amount. Remember, I can't tell the future.

I immediately decided to get out at a fifty-cent gain, if that was to be. Thankfully, it was. This week, I sold out at $12.96.

If you're going to trade, something to keep in mind is that you shouldn't be afraid of getting out at either break-even or a small profit. Egos can blur the line of sanity when buying and selling. It is very, very difficult not to fight with the market. Even though you think you know enough not to do it, that you're above everyone else when it comes to emotion, you're not. I'm not, anyway. Putting in the sell order on my shares, even though I was counting on a dollar move, felt awful.

Thankfully, I didn't have to take a loss. Honestly, I could have become overtaken by emotion and added to my position. Actually, if I want to be completely honest, I probably would have done that had the price action been different. Not necessarily a bad idea, since as I've said, I do like Activision Blizzard's long-term prospects (especially the upcoming fall gaming slate).

However, a trade is a trade, and you should stick to your plan. Sometimes, as they say, taking a small loss and moving on is the better strategy. Not always easy to follow such advice, but you should try. At the very least, I knew enough to get out at $12.96. Not a bad move, either, for a short holding period in many respects. But you know, I almost set the sell order higher as the stock moved up. I am so glad I didn't, because that price seems to be around the resistance level.

Maybe shares of Activision Blizzard were having trouble because we were coming up to the July holiday. Interest from Wall Street wanes around this time of year. Maybe shares will be way over $13 next week. If that happens, then I'll be sad, I suppose. Still, I think I made the right decision.

Disclosure: I own Activision Blizzard; positions can change without notice.