Patience is not my virtue. Since I've taken over active managment of my stocks, i.e. the low point of the year; I have done reasonably well. I am up 15% YTD, and about 30% since my low. However I have yet to learn when to take profits and when to be patient. I tend to buy stocks that I know have value. Yet I can't seem to hold them when they are down; I fret and watch every single hundreth place move up and down. And when they are up; I can't help but hold them, hoping for ever additional dime per share. These two tendencies have cost me. I have yet to figure out; what the "happy" buy in price and "exit" price are. I look at the day's trends and decide at the moment what they should be. As the trends change; I to change my goals. Oh we're up 4%, maybe I can squeeze out 1 more. Oh I'm down 2%, let's avoid the other 1%. Today, I lost out on both ends. At the end of the day both stocks came back up, and although I took profits and one and minimized my losses on the other; both could have ended up better.
Sigh; sometimes you have to learn to cast the die and not constantly recast it. For example, after my fretful selling of the day; I tried to buy into AYR @ the low 18s. I saw it drop rapidly, and then reset my price to sub 18. What happened then? Its now back to 19. My fear of catching the knife is so well honed that I lost out on an easy 5% gain back. Lessons learned.
Out of AFSI at 15.65. In at SWIR at 15.2 and out at 14.9. Up for the week. Down for the day.
Friday, February 22, 2008
Wednesday, February 20, 2008
On stocktips
Neither borrower nor lender be for loan oft loses both itself and friend. Shakespeare had it right, the involvement of money complicates relationships. Since losing $40 bucks and all respect for a high school friend of mine, I've stayed away from borrowing or lending money to friends and family. Better to give it away. It's probably about time to do the same with stocks.
I have yet to be burned by giving wayward stock advise; however persistent inquires by none other than my blood kin have made me rethink my previously ad hoc position. I am no more sure of my stock picking abilities then the next self- proclaimed king of penny stocks; my style suits myself and likely no one else. It is a combination of temperament and risk taking that has produced returns but at a cost of numbers jumping over fences (rather than sheep) and geometric extrapolations that run amuck. If I were to sell or buy slightly differently, these differences may magnify any losses or gains. Let's see if my one and only stock tip fall kaput tomorrow.
Out of CYNO at 23.2. Hindsight says I shouldn't have held out for the 10% gain; I am increasingly learning that ~50% of my speculations do not hit their anticipated end point within the allotted time. In at NTGR @ 22.08. Poor guidance and poor earnings; but fundamentally a good business.
Pretty much all in at AFSI at 15.05. Couldn't get my <15 start point because I was holding CYNO, but earnings were fantastic tonight. If guidance is good tomorrow during the conference call; this is going to move. 18 anyone? Of course if guidance goes down; man that'll be ugly. Thank god for value.
I have yet to be burned by giving wayward stock advise; however persistent inquires by none other than my blood kin have made me rethink my previously ad hoc position. I am no more sure of my stock picking abilities then the next self- proclaimed king of penny stocks; my style suits myself and likely no one else. It is a combination of temperament and risk taking that has produced returns but at a cost of numbers jumping over fences (rather than sheep) and geometric extrapolations that run amuck. If I were to sell or buy slightly differently, these differences may magnify any losses or gains. Let's see if my one and only stock tip fall kaput tomorrow.
Out of CYNO at 23.2. Hindsight says I shouldn't have held out for the 10% gain; I am increasingly learning that ~50% of my speculations do not hit their anticipated end point within the allotted time. In at NTGR @ 22.08. Poor guidance and poor earnings; but fundamentally a good business.
Pretty much all in at AFSI at 15.05. Couldn't get my <15 start point because I was holding CYNO, but earnings were fantastic tonight. If guidance is good tomorrow during the conference call; this is going to move. 18 anyone? Of course if guidance goes down; man that'll be ugly. Thank god for value.
Wednesday, February 13, 2008
On patience & reg T
They always say never look at how well your old investments are doing. If they climb dramatically you'll only cause paralysis the next time a decision needs to be made.
It's impossible to fully predict short term market movements. I pretend to look at a chart and see a trend; oh it "seems" bottomed out, or "topped" out. However for everytime that I have called it correctly, there are an equal or greater number of times that I have been incorrect. An example, I was burned by LVAC bottoming out at @14, althought I wanted to buy it at a lower point. This increased my anxiety and desire to buy in quicker. Yesterday I was in at CYNO at 22.82, and had to sell positions in two other stocks. Both CVLT and TGI are up dramatically, 5-6% since I sold. CYNO, dropped 3-4% yesterday and has only just returned. If i had waited till day end; which is when I usually like to buy my stocks; I could have captured about 4 % extra yesterday and another 5% in CYNO today. This would have taken me up another 10% in 2 days.
All I've learned, is that hunches are merely hunches; I'll just have to trust my gut that CYNO will bring me > returns than keeping CVLT and TGI. Also, end points are extremely helpful, keeping to my endpoints in CVLT and TGI would have kept me winning; but then again, I am also missing opportunities (BW and ACTU) because of these endpoints. So here is another CYNO @ 26. HRP @ 8.5
I also ran amuck of Reg T yesterday, the 3 day settlement period is a B given my new trading style. Margin accts, eliminates this restriction with no cost; provided I don't trade on margin. Its so tempting though....
Still watching AFSI for the high 13s. BBSI as well. Terrible couple of days; but today is up and should return another 5% by early next week.
No new stocks catching my eye.
It's impossible to fully predict short term market movements. I pretend to look at a chart and see a trend; oh it "seems" bottomed out, or "topped" out. However for everytime that I have called it correctly, there are an equal or greater number of times that I have been incorrect. An example, I was burned by LVAC bottoming out at @14, althought I wanted to buy it at a lower point. This increased my anxiety and desire to buy in quicker. Yesterday I was in at CYNO at 22.82, and had to sell positions in two other stocks. Both CVLT and TGI are up dramatically, 5-6% since I sold. CYNO, dropped 3-4% yesterday and has only just returned. If i had waited till day end; which is when I usually like to buy my stocks; I could have captured about 4 % extra yesterday and another 5% in CYNO today. This would have taken me up another 10% in 2 days.
All I've learned, is that hunches are merely hunches; I'll just have to trust my gut that CYNO will bring me > returns than keeping CVLT and TGI. Also, end points are extremely helpful, keeping to my endpoints in CVLT and TGI would have kept me winning; but then again, I am also missing opportunities (BW and ACTU) because of these endpoints. So here is another CYNO @ 26. HRP @ 8.5
I also ran amuck of Reg T yesterday, the 3 day settlement period is a B given my new trading style. Margin accts, eliminates this restriction with no cost; provided I don't trade on margin. Its so tempting though....
Still watching AFSI for the high 13s. BBSI as well. Terrible couple of days; but today is up and should return another 5% by early next week.
No new stocks catching my eye.
Tuesday, February 12, 2008
Taking Profits
Deciding when to take profits is a bitch. You never lose by taking it early, but damn does it sting when you sell and the stock keeps climbing.
Beacuse of the volatile market conditions; I tend to take them earlier than later, although recently I have been stung by the bug of inertia. I held on TGI for my original out point, but in doing so, passed up several other opportunities for quick wins. Given my current trading style, I will lean towards being rash than being patient.
Then again, patience can bite in several ways when buying. I like to put in limits below the current price, 1-2% below. However, sometimes you manage to get in and sometimes you don't. Missed out LVAC at 14.00 yesterday because I put in 13.90. Went to 14.70, a quick 5% gain in intraday trading that I missed.
I am out of CVLT @14.80. Was too patient on holding this out for 15.40, which it never got to. I am out of TGI at 56.10, although I should have been out at $57 several days ago. Hindsight= bitch.
In at CYNO @ 22.82. What do I like; cash flow, book value, cash on hand is good, EPS is good. Debt is low. Beat high end consensus for the 7th time in a row, predicts forward looking growth prospects in 2008. But for some reason; its getting beat up anyways. I am confused. Looking fwd to 10% gain at least by week's end.
Then back into AFSI before earnings next thursday.
Beacuse of the volatile market conditions; I tend to take them earlier than later, although recently I have been stung by the bug of inertia. I held on TGI for my original out point, but in doing so, passed up several other opportunities for quick wins. Given my current trading style, I will lean towards being rash than being patient.
Then again, patience can bite in several ways when buying. I like to put in limits below the current price, 1-2% below. However, sometimes you manage to get in and sometimes you don't. Missed out LVAC at 14.00 yesterday because I put in 13.90. Went to 14.70, a quick 5% gain in intraday trading that I missed.
I am out of CVLT @14.80. Was too patient on holding this out for 15.40, which it never got to. I am out of TGI at 56.10, although I should have been out at $57 several days ago. Hindsight= bitch.
In at CYNO @ 22.82. What do I like; cash flow, book value, cash on hand is good, EPS is good. Debt is low. Beat high end consensus for the 7th time in a row, predicts forward looking growth prospects in 2008. But for some reason; its getting beat up anyways. I am confused. Looking fwd to 10% gain at least by week's end.
Then back into AFSI before earnings next thursday.
Thursday, February 07, 2008
Oversold
The identification of the oversold stock is perhaps one of the most difficult and lucrative plays. How does one determine the intrinsic value of a stock. And for those that are looking for a quick bounce; which stocks are more likely to bounce back in the double digit percentage range. Large falls provide the biggest opportunities for large subsequent gains. Nevertheless Mr. Market occasionally drops that knife; making this play one of the most perilous types of speculations. (let's not use the word investment; its not an investment.)
One example; DBTK, in at 11.30 and out at 12.44 in less than 24 hours. It's not a bad 10% in a single day. What's to like; intrinsic value is high, the bottom and high end were stable. Small caps tend to oversold on any negative news (guiding 2008 lower). It had dropped 30+% from 15.30 to my purchase price. More importantly this was a fundamentally sound business, so people are going to buy back in. Key questions? Was the overreaction due to current market conditions? What factors may prop up the bottom and limit any losses.
Other positions; out of AFSI @ 15.75 and HURC @ 35+. I like both stocks, but i think HURC will hurt in the coming months with the impending slow down. AFSI is still financial/ insurance; and that market is extremely tumultuous. I will be tracking for AFSI @12-13 to buy back in, and HURC in the low 30s. BWLD @ 21ish (also being hurt by consumer confidence). I have owned HURC and BWLD for a long time; enough to enjoy splits.
In at CVLT @ 14.40
One example; DBTK, in at 11.30 and out at 12.44 in less than 24 hours. It's not a bad 10% in a single day. What's to like; intrinsic value is high, the bottom and high end were stable. Small caps tend to oversold on any negative news (guiding 2008 lower). It had dropped 30+% from 15.30 to my purchase price. More importantly this was a fundamentally sound business, so people are going to buy back in. Key questions? Was the overreaction due to current market conditions? What factors may prop up the bottom and limit any losses.
Other positions; out of AFSI @ 15.75 and HURC @ 35+. I like both stocks, but i think HURC will hurt in the coming months with the impending slow down. AFSI is still financial/ insurance; and that market is extremely tumultuous. I will be tracking for AFSI @12-13 to buy back in, and HURC in the low 30s. BWLD @ 21ish (also being hurt by consumer confidence). I have owned HURC and BWLD for a long time; enough to enjoy splits.
In at CVLT @ 14.40
Friday, January 25, 2008
The Technical Trader
Stock trading is not for the faint hearted. Stocks rarely march according to pre-conceived patterns. Hindsight and statistical analysis gives comfort to those who trade based upon alleged patterns. However hindsight is not foresight; how many times have trends fallen above or below a trend. If the trend is the average predicted value, then 50% of values will fall below and 50% will fall above spec. This is no way to speculate, gamble or invest (pick your word).
Overlying stock movement has nothing to do with underlying value. Any reader of Graham or Buffett understands that opportunity only presents itself when the market is imprecisely priced. A stock with upward momentum does not indicate a forever upward trajectory, nor does a downward trend indicate poor underlying fundamentals. Following the crowd has rarely provided long term and consistent winnings. One analogy is the purchase of winter coats before winter. If one purchased when most people shopped, you would be buying before the winter at the highest prices. However, the greatest value occurs in the off season, when the fewest people are purchasing and the sales the greatest.
As such beat up and little favored stocks often offer the most compelling purchasing opportunities, while over-priced stocks (think dot com and housing) are often candidates for shorting. Of course the fundamentals must be examined....
This blog will track my stock purchases and sales this year based up on my personal assessment of value. Today TGI @ 50.95. I expect a bounce to $60 in 2 weeks. Sale at $65.
Overlying stock movement has nothing to do with underlying value. Any reader of Graham or Buffett understands that opportunity only presents itself when the market is imprecisely priced. A stock with upward momentum does not indicate a forever upward trajectory, nor does a downward trend indicate poor underlying fundamentals. Following the crowd has rarely provided long term and consistent winnings. One analogy is the purchase of winter coats before winter. If one purchased when most people shopped, you would be buying before the winter at the highest prices. However, the greatest value occurs in the off season, when the fewest people are purchasing and the sales the greatest.
As such beat up and little favored stocks often offer the most compelling purchasing opportunities, while over-priced stocks (think dot com and housing) are often candidates for shorting. Of course the fundamentals must be examined....
This blog will track my stock purchases and sales this year based up on my personal assessment of value. Today TGI @ 50.95. I expect a bounce to $60 in 2 weeks. Sale at $65.
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