Question posted by request . . . .- - - - - - - - - - - - - - - -
Rande,
I appreciate all your responses to my (and others) messages. About your timing swings style - I have been considering such a plan, of course on simple terms as I have no fancy software or TA skills.
I was considering searching for undervalued stocks that were gaining momentum and playing them for just a 10% gain (hopefully a couple times per week - I also work full time). I am glad to see that a more sophisticated investor such as yourself does this (or is considering this) also.
My problem lately is that I have gotten in stocks with momentum too late (not necessarily undervalued ones though.) Specifically, alfn and tpeg (in both around 3 and holding - i feel ok about alfn but not so sure about tpeg). others i am in, but not really concerned with are ifmx, celn, plcop, and idtc (down about 20%, but i think it will gradually climb back).
As you can see, I did not do well last month with my "timing". my picks were ok for the most part, but my timing has caused me to be down a lot of money.
3 questions:
1) any suggestions with what to do with my positions?
2) how can I improve my timing on buying and selling?
3) what do you use to determine the bottom end of a stock price?
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RESPONSE:
Stay away from momentum plays. . .they will eat you alive. I think you also may have picked too many long shots. The timing play list, to which you refer. . .is mostly made up of stocks that have news at LEAST once per month and many have 2 or more. They move up when news hits and since stocks tend to re-trace movements, we stand to gain by ANTICIPATING these moves. That is it, in a nutshell.
The stocks you listed are long shot swing trades. . .if you try to play them as timing play based on movements from news, I think there is a better chance you will lose MORE waiting for them, than you might gain in whatever moves occur.
3 answers:
1. I would be looking to move OUT of the long shots, with the exception of your 1 FAVORITE long shot. . .whatever that might be. . . then, if you really are interested in timing. . .pick some HOT stocks that you know and that you have seen move sharply when news hits. . . especially those that could get some big news any day. The timing play post here gives a list of prospects I like. . . I am sure William could double that list. . .and others may have even better picks.
THAT is not what is important. 2. What IS important is how well you know the trading patterns of the stock. The better you know HOW a stock moves. . .the easier time you will have picking a bottom and picking a top. . .and the easier time you will have suffering thru any slow periods, etc.
3. I often ask someone to help with technical analysis. . most are willing to help. . .when selecting a bottom, etc. . . but many stocks are just plain obvious.
Regardless, YOU need to develop a working strategy. If the strategy you have been using is NOT working. . which you have indicated. . then it is time for a change. . .I cannot tell you what the best change would be. . .but we have offered several strategies here. . depending on your needs. . degree of associated risk you are willing to take and your time frame.
But again, your technique and strategy cannot and should not be dictated by nobody but you.
If would consider a rock solid anchor like A.T. and T., another like Compaq or SEEK. . .then I would pick a few timing plays I could count on. . .like those on list. . .next I would pick ONE sleeper or undervalued gem. . .and finally two good solid swing plays. . . no MOMOS.
That should give you a strong, yet very aggressive port, where it should break even while waiting on the event driven or timing or sleepers. And that would be a major improvement over losing 20 percent.
Hope this helps. . . .others may give their views as well. . .
Rande Is |
