I’ll admit it.  I got my a@# handed to me on my most recent foray into options.  I’ll also admit that I totally stole the title of this post from a phrase my friend Andy uses. I can’t help it, as it sums up BEAUTIFULLY what happened to me today.

Here’s a quick synopsis:

I have been following Visa (V) hard for the last couple months. So going into earnings I decided to speculate a bit, being extremely bullish on the quarter and place a 75/85 bull vertical spread. It wasn’t expensive, and I had defined risk on the downside and playing a spread kept the costs manageable. I was, like MANY, MANY others out there expecting a good 3Q earnings report. All they did was blow their numbers away, AND reaffirm 4Q guidance. All is great right? The aftermarket pops, I go to sleep thinking I nailed it.

Except it didn’t go that way. Futures turned overnight and then V tanked. The bottom fell out. I traded out of my position with a marginal loss when the stock rebounded to 76 or so during intraday.

Easy reminder of where we are economically. Things aren’t behaving irrationally. Tug of war between the bulls and bears is leaving positions hung out to dry. When you think things are going up, they go down.

For now, I’m going back to being safe in the market. Cautious is a difficult card to play, though