Dwight Karlsen & Co.; <<avoiding the patch like the plague.>>
First; Dwight - I suspect your agenda; given the timing of your post & the sudden re-appearance of ''Dr. Yo'', or is it really Dr. No ? <VBG>. Why me,, why now ? Just when the sector is turning here, huh ? hmmmm? If you are avoiding the oilpatch like the plague, why would you be reading a post from me, how would you even know who I am ? and why would you be responding NOW, hmmm ?
I don't think you are going to get any satisfaction here... Obviously some little ''ego-meister'' wants to re-enter the fray here, but obviously has some ''issues'' to deal with... sorry all; just skip this boring post - but a response to the ''hidden agenda'' boys is deserved...fwiw
First; here is the boring story of poor little $lider <VBG> and my ''mis-adventures'' in the Oilpatch; <VBG> !
Yes; I am absolutely 110% guilty of calling for a bottom, and more importantly calling for a ''rebound'' into the June & July Oilpatch selloff. Absolutely, could not be more wrong - period ! Yes; I lost money, actually big money , real large money - get the picture...<VBG>. I plead GUILTY and throw my self upon the mercy of the court...as does half of the entire Financial World and numerous Fund managers <VBG>. Gee, we all got it wrong didn't we ? As did all the holders of Microsoft, Lucent and Cisco Ford & IBM in the total market crash when they puked and sold, or those who also were gluttons for punishment and shorted into the bottom <VBG> !
But being wrong, and quitting are two completely different philosophies aren't they ? Something about knowing when to hold, when to fold, or when to walk away.. rings true here doesn't it? Well folding, and holding were prudent - walking away wasn't and that's where all the ''Sour-Grapes'' critics are coming from. Many, many people just walked away - no problem with that from me. However; the unbridled and curiously timed return criticism of the exit-takers seems a bit suspicious; just when we've been proven correct of late in very, very profitably tradingt our now 4th rolling wave in the Oilpatch - you guys return ? smelling some money ? Well after three 20-30-50%+ ''pops'' that many here successfully traded, there is plenty of money that you may be smelling here <VBG>. So ''smell it & weep'' !
As I do plead guilty to being human; I was wrong - however; I was not entirelly wrong; I was just early <VBG>. Given the rebound from the end of August/1st of Sept selloff ...and the now 4th rolling wave trading range that the Street has so graciously presented to us on a Silver Platter. Being entirely wrong is one thing; learning from ones mistakes and re-grouping a smarter, more experienced, more open minded and more - ''TRADING" oriented investor is quite another...
However; what separates me from the sour-grapes - whiners; is that I truely believe now; more than ever, that this sector and many (not all) of these companies represent tremendous profit opportunites that will far, far exceed market average returns. While some people take a ''once burned - forever scorned'' attitude toward the Oilpatch; I find that to be a purely ''emotional'' and irrational reaction to a ''logical'' and mathematical problem...
Where would the World be, if we all quit one shovel from the Gold ? Where would we all be, if when we are behind on the scoreboard, we all laid down and quit when the 2 minute warning gun is fired ? Is America a country of quitters ? Is investing an enviroment where quiters, or the emotional can possibly survive, let alone flourish ? No - I don't think so...aint no ''quitter'' in my blood; sorry.
While blind stubborness is not a desired investing characteristic; I do not view my persistance here as blind stubborness; quite the contrary. I preferred to re-group. Went to cash; watched the sector fall farther. However the premise of the tremendous upside valuation/profit potential based up the future return to a ''mere'' normalized crude oil enviroment remained. I learned through my mistakes, but I didn't quit, nor did I change my longterm view of the potential here. What I did decide to do; was take what the Street was willing to give me here. I researched, read, studied; and researched, read and studied some more. I became very familiar with the individual companies of the oilpatch. I read every annual report, every earnings report, every analyst review that I could. I put literally hundreds, and hundreds of hours into research here. I also, studied how the Street reacted here - what did they do and why did they do it ? What were their mindset ? What were their predictable actions and what were their unpredictable actions ? I lived, breathed, and beat the pulse of the oilpatch here. Above all; I paid my dues !
Also, very importantly; what I decided to do, was to focused on how the Street would react; be it irrational or not; to various market actions news events and the fundamentals of crude prices, earnings, rig utilization and dayrates...etc. I formulated a ''trading'' philosphy to trade ahead of the Street; to beat the crowd to the party - but to first make sure what the address was <VBG>...
By ''address'' - I mean at what point the Street would buy, where would they re-enter. More importantly - ''why'' would the re-enter ? Sometimes the questions are more important than the answers... What value criteria were they using ? Stockprices being cheap, or being down a susbstantial percentage were not the criteria. Been there - done that; didn't work... But, then I began to see the Street talk about and then actually enter at ''asset replacement'' valuation levels that the Street deemed to be historically significant of past bottoms. They did NOT use the 10 year low shareprices that so many warned us of ! They started to discount even positive earnings, used cash flow as a measurement of companies, used high Debt load as the curse of death and on & on. - These naysayers entirely missed the opportunities of late. The Street also did not selloff automatically at these valuations, or even on bad news (ala~ SII on its bad report) they were not selling/trading on negative trending earnings any longer ! They didn't sell off any every negative API report ! Alas ! - we began to find what the Street was using as a guide to valuations, to read into/predict where they would enter, buy, or sell; not on today's fundamentals/crude prices - but, rather on the future expectations of fundametals/crude prices !
Also, I began to have an open mind to technical analysis - not because I think it is the ''be-all'' of trading; but because it became undeniably apparant that the Street was using it ! Again, I decided to use it selectively and profitably to guage when the Street would not only buy, but when they would sell; as imho - WE WERE IN A CLEARLY DEFINED TRADING RANGE !
Rule: the Street gets to make the rules !
So if they decide - ''it's a trading range game'' - if you want to ''play'' the game - you gotta play by their rules ! We learned that one could very profitably trade these ranges if one didn't get too greedy ! While the ''Sour-Grapes/Naysayers kept yelling - don't call the bottom, don't time the market - some of us actually learned to only try to capture the middle 2/3rds of these moves - don't be greedy & don't try to beat the Street enrtirely at both ends of a move. If you do, they will crush you... Take pieces of what they will give you and do it again and again !
PS - here is an idea; we didn't have to call the ''exact'' bottom - as if hitting the ''exact'' bottom is necessary to make a boatload of money ? - No this is just like Horse Shoes & Hand Grenades; - one only has to be ''close'' to win this game !!!! and one has to most importantly identify ''what'' game the Street is choosing to play (trading range, Mo-Mo move etc...). And never, never forget - they all ways are the ones that get to choose what game we play !
I have emerged a battered, but hardly beaten; much more savy & sophisticated investor. More importantly, I emerged a trader ! And now I am becoming (at last look) a very profitabel trader here fwiw.
Am I God's gift to the Oilpatch ? - hardly; I view myself as merely an equal among many... Yes; I do love to chatter - all ways have & all ways will.. yak - yak - yak.<VBG>. So there you have it - what can I say ?
Time to trade ! FLC & PDE lagging hmmm;
- Ciao... |
