Losses versus gains.. a matter of percentages, and good fundamentals..
about 9 reasons I've done pretty well this year.. to all add luck and market momentum also and some major decisions that at the time defied logic.
1) I got into lots of puts from August 19 and have been calling puts during that entire time frametime.
exchange2000.com
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Some of the other posts are gone have just strange numbers in them????? marketgems.com (maybe they are gone from there as well)
2) I've been into small cap and/or 'beaten down' and "severely beaten down' stocks since September and luckily they have just had the right momentum to move up.
3) I just get out of stocks before losses become major (over 5%) my stop loss is technically as low as 3%.. There are exceptions of course. Some really good companies that I feel are only on a 'technical retreat' I might hold.. XEIKY, NMGC,MEMCF are examples
4)Probably the best reason I don't have as many losses is because I leave a lot of profit on the table sometimes up to 50%. I had really made up my mind to hold NTAP through November but I sold it and now it's up 10 points since I sold.
5) Another reason I think is that I read, research, and chart only companies that follow stringent criteria so I don't get 'involved' with too much junk. I'm always reading about changing trends in the sectors and follow almost nightly fund and institutional buys.. It's like I like to 'travel in only the best circles' to coin a trite cliche.. Fundamentals are very important for me. I miss out on 'purely' tech breakouts like VVUS, AMMB, IOM, CIEN because of my crieria but then that's why I have the poster on SI to 'give me good tips' so I can get in these also
6) Earnings plays are good to 'propel' a company at least to move one way or another. They are on my watch lists about 8 months out of 12. A company that barely moves all year will 'move' at or near their report date. Sometimes even a company that comes out with bad earnings report will have done well on 'anticipation alone' POS comes to mind, which was up 5 points on anticipation and promptly down 6 after the report came out. Even RCOT had some very good plays last week.
And conversely, a company that had a very bad earnings downgrade will actually be up before and/or after they report because of "hope" of a better next quarter. HTCH, MUEI, NN are a few that come to mind.
7) Another reason is that the gains lately have been a lot more percentagewise than the losses so my risk tolerance is much higher now and I'm able to take more chances. I lost about 3/4 point in a stock like LZB, but I made about 3-5 points stocks like VTSS, BKE or ANLT.
8) I was very active and in the internet sector since January 1998. and have been a long time holder and trader of stocks not just AMZN,AOL and YHOO (I've never owned a share of AMZN or YHOO, just options) but also MSPG, ELNK, NSOL and lately also VRSN, VRIO and OZEMY..
9) My best decision was selling off my entire long term portfolio little by little and finally finishing the sell off after the September rally.. lossing about 13% profits on the rest of it, but making much more up using that capital for trading both day, position and swing from Mid September through beginning of November.
I've 'escaped' two potentially large losses this week with SEEK and YHOO options. SEEK I opted to hold through a 3 point loss and it came back and YHOO puts I sold after about 30% loss on the options and QCOM with 40% loss on its option.
I don't like to hang on after 5-10% unless of course the stock is still in a strong uptrend.. It would have been silly to exit FBN, TOM, CLX, TXCC or CREE, but when I finally exited them, they all went up more... |
