Warning - another long and boring post
Hello, Jay
When I was a young and callow lad and played the futures markets until my tax guy told me that the up one year, down next year pattern was making him seasick, I did double up. After all, I'd read about the guy who kept on doubling his gold position during the great 1979-80 runup until he was getting visits from the Comex people asking him to stop. If I remember correctly he took a tiny stake to $90MM and still escaped with about $30MM when the music stopped. The usual result with me, though, was that when the inevitable downdraft came I'd lose more than I'd made in the runup, even if the correction was a minor one. So my answer is - no, I almost never double up.
I will double down, however. The reason I do - not always, sometimes - is that when my stock craters, there usually is a point where it stabilizes and moves up. The trick here is to take advantage of the momentary rise and sell a doubled position. It won't turn a losing trade into a gain, but it will cut your loss.
BTW, this takes a lot of discipline, which I often lack. But I think it is a fact that you do get bounces in downdrafts, and if you can force yourself to go against the grain and sell into the rebound, it is an effective way to cut losses.
Your take home selection is interesting - I also took home AAPL, ADPT and IOM (the latter from yesterday). Unfortunately I sold DBCC at 19 1/2 and it looks like it might gap tomorrow. I also took CIEN home because nobody wanted to bail me out at 15 3/4 at the close, darn it. |
