Slider, were on the same strategy, just due to a small difference in taste, we're on just a slightly different course.
When I read your posts and think a little about what you are doing, assuming you are doing what you say you are (and I believe you are), I conclude what you are really doing is managing the risk/reward opportunities being presented by the market, AND taking advantage of those.
It is important to properly evaluate and stay on the right side of the risk/reward equation, at all times. If no reward you don't play. If the risk too high you don't play. Those are the primary limits. Everything in between is subject to personal choice and preference, but obviously some situations are preferred. The mother lode is always the low risk/high reward. When these come along you want to truly take advantage of those, with a large percentage of what you have available.
In addition to the risk/reward of individual equities one at times needs to expand and apply the same principals on a broader scale, about their whole portfolio. For example being short certain equities at this point in time has little downside risk, and good upside if the market truly tanks. Being long others may have limited downside if the market tanks, but good upside if there is rebound. Not knowing for sure which way things are going to go, as may be the case at the moment; viola - prepare for both, with stops for either case. At other points in time it is just as obvious to be overweight for a particular situation.
Just my $.02. |
