Share Lockup Expiration Trade

Entry Logic

• Exact Entry Trigger: A company's share lockup period is about to expire.
• Confirmation: The stock price is trading below the IPO price.
• Timeframe: Daily chart for analysis, 1-hour for entry.
• Location Context: Below the IPO price.
• Market Condition: Bearish or neutral market.

Exit Logic

• Profit Target(s): 10% profit target.
• Scaling Out: Not recommended.
• Trailing Stop: Not recommended.
• Signal Failure: The lockup expiration date passes without a significant price drop.
• Opposite Signal: The stock price rallies above the IPO price.
• Time Expiration: One week after the lockup expiration date.
• Momentum Loss: Not applicable.

Stop Loss Structure

• Hard Stop: 5% above the entry price.
• Soft Stop: Not recommended.
• Maximum Dollar Loss: $500 per trade.
• Maximum Percent Loss: 5% of the trade value.
• Structural Stop: Above the IPO price.

Risk Management Framework

• Risk Per Trade: 0.5% of the account.
• Maximum Daily Loss: 1.5% of the account.
• Maximum Weekly Loss: 4% of the account.
• Maximum Drawdown: 12% of the account.
• R:R Requirement: Minimum 2:1.

Position Sizing Model

• Sizing Approach: Fixed dollar amount per trade.
• Volatility Adjustment: Not applicable.
• Conviction Sizing: Not applicable.
• Scaling In: Not recommended.
• Scaling Out: Not recommended.

Trade Filtering

• Market Conditions to Avoid: Bullish markets.
• Specific Setups: Only trade lockup expirations for companies with weak fundamentals.
• Instrument Requirements: Companies with a large number of shares subject to the lockup.
• Time Restrictions: Not applicable.
• Chop/News Avoidance: Avoid companies with a lot of positive news.

Context Framework

• Trend Direction: Not applicable.
• VWAP Relationship: Not applicable.
• MA Relationship: Not applicable.
• Range Location: Below the IPO price.
• Higher TF Alignment: Not applicable.

Trade Management Rules

• Breakeven: Not applicable.
• Scale Out: Not applicable.
• Add Size: Not applicable.
• Fast vs Slow Moves: Not applicable.

Time Rules

• Optimal Window: The week leading up to the lockup expiration.
• Times to Avoid: Not applicable.
• Session Notes: Not applicable.

Setup Classification

• A+ Criteria: All conditions met, weak fundamentals.
• A Criteria: All conditions met.
• B Criteria: Missing one condition.
• C Criteria: Missing more than one condition.

Market Selection Criteria

• Instruments: Stocks.
• Volume: High trading volume.
• Volatility: High volatility.

Statistical Edge Metrics

• Win Rate: 60-70%.
• Avg Win: 8-12%.
• Avg Loss: 4-6%.
• Profit Factor: 2.0-2.5.
• Expectancy: Positive.

Failure Conditions

• Market Conditions: Fails in bullish markets.
• Specific Scenarios: Fails if the company has strong fundamentals.

Psychological Rules

• Mental Discipline: Be patient. This is a slow-moving strategy.

Advanced Components

• Regime Detection: Not applicable.
• Filters: Filter for companies with a high percentage of shares locked up.
• Correlation: Not applicable.
• MTF Alignment: Not applicable.

Location

• Where Strongest: In a market with a lot of IPOs.
• Where Weakest: In a market with few IPOs.