What is Wiggle Room?

Wiggle Room is the regular variance that a stock has from day-to-day, week-to-week. It isn't the big highs or deep lows. It is that sweet spot in the middle where a stock hovers. For example, if you look at Freddie Mac stock (FRE), over the last month it has had a range of about 71 cents to 90 cents per share. Most days it has been between 72 and 82 cents per share. That 10 cent range is what I call "Wiggle Room".

My goal is to make ten percent on my money in a short period of time, and do this over and over and over again. If I can make 10% on my money eight times, I will have doubled my money. If I double my money thirteen times, I can retire.

If I bought 1000 shares at 72 cents per share, and sold it at 82 cents per share, I would make $100 on my $720 investment. Then I have to take out etrade's fees of $10 to buy and $10 to sell, so I wind up with $80 profit which is about 11%. Cool. Hopefully the stock hits both prices, the buy and the sell price, in relatively short order.

One thing that really helps me to believe that I can do this is the fact that I can set my price, enter my buy orders or sell orders "Good for 60 Days" and just walk away. Whenever the stock hits the price, the order will get executed. I still plan to check the stocks every day, but the stress of missing the opportunity or getting "off-plan" is not something that I have to deal with every minute of every day.

I am sure there is some professional investor term for this approach, but like I said in my earlier post, at my age I don't really care all that much what the rest of the world does. This is what I am going to do.