EXAMPLES OF GOOD RECENT TRADES (and bad)
To try and further illustrate my reasoning (which you may or may not agree with) and the types of trades that I hope we make and not make - see both good and bad trades below). BTW - the below info is mostly taken from some posts I made on SI over the last few days. Let's see if your thinking and philosophy match mine. If so, welcome!
FAVORABLE RISK/REWARD STOCKS and GOOD RECENT TRADES
Note: all of the below successes were quite dependent on the Market rallying (or at least not falling dramatically). If it had turned ugly, even though entry points were good, I would have likely sold quickly to limit losses. Of course, I reasoned that the overall market was more likely to rally than not.
MDT entry at $46+ after upping guidance (sold at $50). Love the stock although PE is a bit high; would re-enter on market/stock pullback. Also, some pubs are positive, which increased my feeling it was a good reward/risk at $46. The market was questionable as to what it would do this week, so I was ready to sell near a breakeven if things went awry, but luckily the Market co-operated.
BMC entry at $16+ after they upped guidance (holding at $18+) with mental stops under toady's low at $17.88 although I feel very comfortale holding this longer term, too).
MHP at $56+ (sold at $59+); love the stock but expect Market pullback and not getting greedy. Three points is 3 points in 2 days.
SONS at $4.50 - one of the more risky trades I've made recently but took a chance Monday when it appeared to be holding it daily low. If it had broken to a new low on a falling overall Market, I would have taken a small loss.
Currently near $5.30 and I sold when the Market began weakening. This could run higher on news with China, but one never goes broke taking a nice profit of 15-20% in one day.
JPM at $35-36, recent low, sold at $37+ as banking sector not exactly favorite group even though stocks are cheap, especially WM with PE under 10. I have no problem buying quality stocks in this group on significant pullbacks. Several pubs like JPM.
GE at $36-37 after reassuring guidance. I figured even in the weak market of last week, this had a good Reward/Risk ratio. Sold too early at $38-39
AMGN at 56-57 early Monday for expecatation of an intraday pop after listening to excellent C.C. This was a calculated quick play ONLY. Sold at close for $59+ because of uncertainty about what analysts might say the next day. Sure enough, stock now below $58 after many were cautious on prospects. Might still get in if stock further weakens.
HCR at $21-22 on low valuation and favorable chart. Now at $23+ after analyst Strong Buy Tuesday morn. Still holding - chart favorable and could run a bit more. Also, this is one I don't mind holding long term as it's PE and PEG are very reasonable, as it it's future prospects.
COST entered at $41-42, on re-test of earlier level a couple weeks ago of 40+. Bounced nicely off lower Bollinger band. Several pubs positive on stock's prospects which increased my boldness in purchasing this near $41, even though overall market was weak last week. Another minor plus, Jim Cramer was beating the drum on this one recently on his radio show (OK, so it's Cramer but he does have a following).
A FEW MISTAKES,TOO
MCD at $27. Turned out to be a bad trade. I thought this one was gaining momentum after their decent earnings report, but turned out it was more negative than it first appeared so sold the stock for a 1/2 pt loss. Why hold it and hope it comes back soon? Sure I could have put it away but it's probably dead moneyy for a couple months at least.
Bought ADCT and some SONS over $6 a couple weeks ago the day the Market broke solidly to the upside. I "bought into" the momo talk that the market was gapping to new highs. Remember how excited everyone was? Well, there's a lesson there too.
THERE YOU HAVE IT .... hopefully this further clarifies my reasoning. I am not saying my logic is right or even better than most, but if your thinking lies along the same lines, we have a computer match (lol!) and I look forward to hearing from you on the thread.
PLEASE - reasoned posts only - quality over quantity. |
