I didn't seem so smart today. I jumped in during the morning rally--knee-jerk style. I was thoroughly spanked by the end of the day when everything turned. I said I was going to wait this week out. I should have followed my own advice.
Down 2.46%
Things looked shaky this morning, but the bulls proved themselves this afternoon. I was too timid to take advantage of the movers and jumped in near the highs of the couple of stocks that I bought.
I sold VSEC this morning with a tight stop. It went on to lose 12%. Goodbye, VSEC--it was a nice run.
Overall the portfolio lost 1.62%. I'll take it given the losses that a lot of people endured last week.
After an awful week, some of my screens have changed dramatically. Two stocks that fared very well last week, VSEC and VSEA no longer appear on the Zweig screen. There are a couple of newcomers that haven't previously appeared, SILC and NE. Looking over the charts, none of them look particularly good yet.
With oil on the march upward again, several oil-related companies are showing up on my screens, NOV, HOC, GLP, and NE.
Valmont Industries (VMI), is right down the street from me and shows up in my Zweig RS screen. They make light poles--boring, but apparently profitable.
SMTX still shows up on the "To the Moon" screen. SMTX is down 30% in the last couple of weeks, so I'll keep my eye on it, but there's no way I'm going to predict where it's headed.
It should be an interesting week. I'm not sure how it will all play out, but I'm looking forward to another week of drama. Be good.
I'm supposed to be doing homework right now, but who can concentrate on that stuff when they've got stock market stuff to write about? Not me.
My happiest days as a trader are when the overall market is taking it in the shins and I still make money. That's what happened this week and I owe my success to risk management and position sizing. I've been trading differently this year. Instead of mechanically following a stock screen (like I did last year), I am paying attention to a few more aspects in my trading.
Last year, I did very well by unemotionally buying and selling based on one of my stock screens. The screen I used was very simple, and I post the results of that screen every week. The screen was the Punk's Zacks and Zweig screen and it made an impressive +60% last year--not too shabby. It didn't matter what was going on in the general market, I just did what the screen told me to do--no questions asked.
I began the year concentrating on that screen again, but after doing some reading and learning, I decided to vary my approach a bit. I discovered I was risking way too much on each trade. Last summer I had my WHOLE PORTFOLIO in one stock for a month (Sothebys BID)! I made over 16% that month, but I had no idea how risky (and stupid) I was being (even with a 25% stop).
Basically, I employed two important concepts that saved me from getting slapped around this week. 1) I refused to risk more than 1% of my portfolio value on any one trade. I stopped out of nearly every stock I owned by Wednesday, but I held on to one stock that refused to go down (VSEC). 2) I didn't allow VSEC's position size to get too out of hand by following it with a stop that wouldn't risk more than 1% of my portfolio. VSEC has gained 57% since I've bought it, so I had to be careful to keep it under control--especially during the rapid losses we saw this week.
The first five months of this year were very frustrating for me (as you can read in previous posts). My dumb screens were kicking sand in my face as I managed my risk and got all protective of my equity. But this week my patience paid off as my returns blew by most of the screens.
I think most traders focus on picking the right stocks (as I have in the past). But a huge part of making big returns comes from how you manage those picks. I'm learning that blindly trading my screens puts me at too much risk for a big loss that will shut me down as a trader.
I highly recommend Van K. Tharp's book Trade Your Way to Financial Freedom if you are interested in learning some ways to better your trading through risk management and position sizing. Here's some free information on position sizing.
What a week! There are a lot of conflicting ideas about what happened this week and about what's going to happen in the near future. I have no idea.
The portfolio actually had a good week -- up 4.16% (more on that this weekend). However, every one of the StockPunk portfolios bit it big time this week with the Zack's and Zweig portfolio showing its worst performance since I started tracking in 2005. It lost 10.69%.
I haven't figured out what I plan to do next week and I'm sure many of you are wondering the same thing--what now? I don't short stocks, so if things don't improve, I'll probably watch from the sidelines for a while.
The bears continue to control this one. I've never shorted a stock, and I'm not about to now (it's too scary). I'll have to say that this is the first time since I began trading that a market move like this didn't bother me. I've actually been able to make money this week. I'll discuss why this weekend.
The portfolio was up .73% today.
We ended up back in positive territory at the close. Don't ask me how. My portfolio was up 1.07%.
My wife told me to stay out of the market today and she was right. That fake bounce would have cost me a lot of dough. Maybe she should be doing this instead of me.
I'm watching SMTX, NILE, CTV, and DRYS closely. It looks like they'll do well today. But, I still think I'll sit this one out. I've been burned too many times when I'm too anxious to get back in because of the fear that I'll lose out.
I called that one well. It was ugly. Besides GLP, not a single stock on my screens managed to survive. VSEC was ahead by 4% most of the day, but met the same fate as most other stocks. My portfolio was down .59%.
It feels good to have a day that finally confirms some of my concerns about the market. The bulls didn't come rushing back this afternoon to save the day. I was tempted to put some money to work this morning, and I'm glad I listened to my head because I would have lost a lot more.
Where do we stand now? I have no idea. But I think I'm going to wait the rest of this week out and see what happens. I still own VSEC and RUSHA, so we'll see if they can lead a comeback. I'll give the rest of my money a rest and let is settle.
Things look ugly this morning so I'd be wise not to buy anything. We'll see how this day plays out, but if the bulls don't come back after running to the exits I think it could get kind of sloppy out there for a while.
My trading today was good overall. For the most part I avoided losers and kept winners. I sold all of my "copy cat" trades. It is time I stuck to the program that has made nearly 40% so far this year. Why am I grabbing trades from others who are making less and whose systems I don't understand? Stupid.
I put a 3% trailing stop on DRYS and it triggered after gaining 3% and dropping back down 3%. It then went on to gain 4% again. It no longer appeared on my screens, but I could have played it a little better.
I avoided mechanical trading today. SMTX lost 7.75%. SYNL continues to be a dog. What's wrong with that stock?
My portfolio was up 1.85% today.
I love the stock market. Another one of my passions is Bible Prophecy (yeah, I'm a freak). I find that they both have a lot of similarities. What got me thinking about this? An e-mail I received yesterday about the soon coming of the end times reminded me a lot of folks who try to predict the direction of the market. Here's what the e-mail said:
..Last Wednesday during a fast, the Lord spoke the words to me,
..."3 weeks until the dam bursts loose" I got the impression that it
...was slightly more - as in the 1st week of August.
...I believe He meant in the spirit and in the natural.
...I asked Him to confirm it. I had 3 direct confirmations 3 days in a
...row and one indirect one.
...The 3 direct ones were:
...Wednesday 1) My gas pump stopped at $33.00 even - without me
...trying or looking at it.
...Thursday night 2) I jolted awake at 3:30 am
...Friday 3) I had a client make a 3:30 appointment - the first one all
...summer for this time. She chose the time, as I had left the whole
...day wide open to her.
...Then, on Monday (I think), the Lord reminded me my birthday is 3/30.
...Last night, in the middle of the night, I heard the words, "2 weeks, 3 days".
...However, I was so tired and they did not register at the time. I only
...remembered them after I woke up. I DID hear them , though. Was it my
...own thought process or was it the Holy Spirit? I do not know, although I
...really think it was the Holy Spirit. It was somehow different than my own
...thoughts. More of an impression with the words, if you know what I mean.
That sounds like a lot of traders I know who think they've got an inside track on how the markets work. They use news, charts, rumors, or "gut feelings" to determine where things are headed. They often promote their "Trade You Way to Millions in Less Than A Year" schemes and sucker people in just like those who say they have a direct link to God do.
Trading is hard work. It takes patience, diligence, and knowledge. There are a few crazy traders out there who get rich quickly and effortlessly (I'm not one of them). But the majority put in hours of effort while avoiding the soothsayers who claim to have a direct link to Mr. Market.
With Biblical issues like prophecy, it doesn't take long to get way off track if you listen to what others think. You've got to figure out what makes sense to you by doing the legwork yourself. The same goes for trading. The only way to create a system that works for you is to design one that makes sense to you (and maybe no one else). You'll never stick to a system that somebody else designs because when the big loss comes you'll be disgusted with it and bail.
PCP has finally left my screening lists after a pretty swell 6 month run. It made around 60% during that time. Thanks PCP.
This week brings VSEA back into the fold. It mocked me last week by gaining around 20% the week after I sold it. I don't know what I am going to do with it this week yet.
SYNL still remains on one of my screens despite a 50% decline. Something is there fundamentally, but it sure has been a dog as of late. It popped 10% for a few hours last week when they reported decent earnings, but it went back to its usual declines. I'm avoiding it this week unless it shows a change of character.
It should be an interesting week so best of luck to all of you. Happy trading!
This was a pretty wild week. I started to drift off course a bit and made some poor decisions. Overall, though, I'm happy with most of the decisions I made--the portfolio was up 3.11%.
My best screen continues to rock. To the Moon added another 8.03% which is the only reason I made money this week. I am too much of a coward to go whole-hog into the To The Moon screen because the returns beyond this year are the result of backtesting. My cowardice has cost me as I continue to dabble with some of the stocks the screen suggests, but I am happy with the amount of hedging it has provided me over the past month.
Like an idiot, I bought a couple of stocks that didn't appear on my screens, but were listed on blogs of folks who know (or appear to know) what they're doing. Needless to say, I lost on all of them. I did the same thing last year at this time and lost my shirt then too. Maybe I've gotten too much sun.
I'm not sure when this is going to end, but I sure am enjoying the ride. Today the portfolio was up 2.21%.
I went from being down 2% to making a whole $13.59 today.
I'm starting to creep back into my old mistakes again. I bought a stock because it was bought by somebody else. It didn't appear on my screens. I got impatient and wanted to share the wealth. It drug me down today. Idiot.
The good news is that I've held out a bit on knee-jerk purchases this week. I've kept about 30% of my account in cash. I've got a couple of buy stops set on some of the screen candidates in case one of them has a big day.
I owned VSEA for two stinking months and it gave me nothing but trouble. I sold it last week and it mocked me today by gaining 10%. Typical.
Not a bad day for the portfolio--up 1.60%. The "To The Moon" screen is screaming again. It's up 4.5% for the week so far.
I tried to cherry-pick a few stocks from my screens today and I ended up picking poorly. My portfolio was down 1.01%.
I'm adding another blog to the list that I read often. It's called Stocks, Trading, Investing: My Ambitions as a Trader and Investor.
It's got a sloppy name and minimal bells and whistles, but I like the guy's style. He has some similar ideas to mine and he shares a lot of information about what he does. One of his picks was up 33% this morning. Check it out.
I've had several e-mails about Stock Investor Pro. This one came today.
Sorry for the multiple emails. I wanted to ask you about Stock Investor Pro. Is it worth the $200 in your opinion? Also, are there backtesting capabilities and the ability to replicate all the
screens on the AAII website?
Mark,
The only way to backtest is to download each weeks' worth of data (about 35mb) and run the program. It's cumbersome and time consuming.
However, the numbers on the AAII website for each screen are accurate (I've tracked them myself to make sure) and every screen except Tiny Titans is included in the Stock Investor Pro software. (Tiny Titans is a two-criteria screen that is very easy to set up on your own).
Howdy everybody. I'm back from vacation.
I had internet access for minutes at a time which allowed me to get quick glimpses of the how my portfolio was doing. I did have access to cable news, (which I don't have at home) and I got a taste for why it is best to go without. People were flipping out about the DOW making all time highs. Monday's drop had gotten everybody worked up that the correction was here, but Thursday's gains changed all that.
It was easy for me to get caught up in all the hoopla, but my portfolio barely budged after Tuesday so I didn't miss much by being unable to monitor things.
I was one of those people that thought things were moving toward some selling so I had some tight stops set. Most of them triggered. By Friday I only owned VSEC and PCP. I'm a bit hesitant to jump back in so I'm going to monitor things on Monday a bit before I make any decisions. I've got a few new stocks showing up on my screens, but not many.
SYNL continues to qualify, but that thing has been a dog for a while now.
I'm pretty happy with how I handled things today. I had many stocks take a big dive (SMTX, TRA, CPLA, SPTN, SYNL) and my decision to tighten my stops and keep my profits worked out very well. I was up 1.20%. I love it when that happens on a down day and I'm getting better at making sure it works out that way.
An OK day. Up 1.5%. I cut my finger on some broken glass and I can barely type. I'm leaving on vacation on Wednesday and this time I won't be able to steal any wireless access. So, I can't guarantee any posting until Saturday. Have a swell week everybody.
Not much has changed on my screens so I'm pretty much sticking with what I've got. I have shored up several of my stops to lock in some of the gains from the last couple of weeks. Generally, when a stock no longer appears on a screen, but has good performance, I'll put a 3% trailing stop on it. This allows me to take further gains if they occur and gives me a quick exit if things start to head south.
It has been one month since I purchased Zacks Research Wizard and I've had many inquiries into how I like it. As most of you know, I'm an avid user of AAII's Stock Investor Pro and I like it very much. I will continue to use it because it has proven itself over the last few years and I've found the folks at AAII to be reliable and the information in Stock Investor Pro to be accurate (and profitable).
To be fair, I have very limited experience with Research Wizard. However, I have been able to run a bunch of backtesting and various screens over the last month and three of the four stocks listed in my "To the Moon" portfolio are stocks I pulled from Research Wizard screens that I've put together.
First I'll let you know what I like:
It's Fast.
With Stock Investor Pro I get information on a weekly basis that I have to download to my computer. I then have to unpack the file and run the screens using the program.
With Research Wizard, the data is centralized on Zacks servers. When I run a screen, my computer (which must be online) grabs information from the server and displays the results in one to two seconds. Even backtesting huge amounts of information only takes a minute or two at the most. That's cool.
Backtesting.
It used to take me hours (or even days) to test a theory I had about a particular screen. I often had to go through old spreadsheets or hard copies to figure out how particular ideas performed. Stock Investor Pro has no backtesting capability built in. To test ideas I would download historical data (on a weekly or monthly basis) and run the software to see what stocks met criteria.
With the backtesting, the process is almost instantaneous. That gives me the freedom to dream up an idea and test it almost immediately. I know that backtesting has its problems and inaccuracies, but it can give a very good idea of what works and what doesn't.
It's very easy to use.
I've worked with several screening programs. Some make my eyes glaze over as I read all of the mathematical formulas that I need to punch in to create a screen. Research Wizard is extremely intuitive. I really like the ability to pare down my screens and find the "Top" stock in a certain percentage, relative strength, volume, etc.
What I don't like:
It's expensive.
At $133 per month, it doesn't make sense to use it unless it is helping you to beat the market substantially. The verdict is still out on whether or not Research Wizard will make my trading better, but the results of the "To the Moon" screen so far suggest that the possibility exists.
Marketing for Research Wizard is confusing.
I'm not an idiot, but I had a hard time weeding through the Research Wizard web site to get the information that I needed. The folks on the phone are much more helpful (they have to be to make a sale), but I would have appreciated knowing the price up front ($1,600 per year). Also, there is an add-on that allows more complex backtesting that I assumed was included in that price. It isn't. It's $1,600 MORE. It looked interesting but I couldn't justify the price, yet.
I feel a bit isolated.
With the amount of information that Research Wizard generates, I'd expect to see some sort of community or forum dedicated to sharing winning strategies or interesting ideas. Zacks sends an e-mail every day, but it's kind of a conglomeration of all Zacks does. I love information and I would like to see more coming from Zacks about Research Wizard.
Well, that's my take so far on Research Wizard. I'll continue to keep you up to date about my satisfaction in upcoming months.
This week illustrates why mechanical trading often trumps putting lots of intellectual labor into choosing stocks. Conventional wisdom suggested that this was a very poor week to trade.
Things turned out OK at the close. My portfolio was up 1.16%
My friend Sean has been extolling the virtues of IESV.OB for the past month now. Apparently it's a company that harvests methane from cow manure. The stock is at about 5 cents and he's hoping that it climbs to a dollar. Maybe a few of you could by $10 worth and make the stock pop a couple of times to get him excited.
I've traded over the counter stocks in the past and I have had some success (I bought TRLG at $2.58), but I avoid them now. They are WAY too volatile and too hard to control. I've only had one pass my screens since 2005 and it lost 50% the couple of weeks that I owned it.
Sean thinks I'm insane, but I generally don't have any idea what the companies do when I buy the stock. I get too emotional when I'm rooting for a company because it makes a good product. I'd rather just trade symbols and let the fundamentals speak for themselves.
My portfolio came screaming out of the gate this morning and my heart started racing a bit as I was up nearly 2%. Of course, I had to look again at lunchtime and I've given back most of that.
Charles Kirk posted a good article about being a perpetual student. He used a golf analogy. I don't like golf, but it made sense.
I've been using Zack's Research Wizard for about a month now. I'm putting together a "review" for this weekend.
I hope everybody had a swell 4th of July. I did.
I didn't realize that the market was closing early today so I couldn't figure out why my stocks we're staying the same for so long.
I lost .88%.
This was my best day since May 2nd, 2006. My portfolio was up nearly 5%. Yowza. Now let's hope this isn't a repeat of two Mondays ago where I made nearly 5% and lost it all (and more) in the two weeks that followed.
The best performing screen today was the "To The Moon" screen which made 7.09%.
A few readers have expressed that they've been a bit confused by the screens that I posted last week. My intention was to discuss a screen a week in detail.
I've removed one of the screens that came from my playing around with Research Wizard. I think it's a bit too soon for me to post screens based on the Research Wizard because I've used it less than a month and I'd like to test things out over the next year.
The "To The Moon" stock screen is kind of a hybrid using AAII's Stock Investor Pro and Zack's Research Wizard. It encompasses my own ideas about what stocks are about to take off and is a short-term (week to week) trading strategy.
Those of you who are following the screens closely can see that there are just a few changes on the screens from last week. Let's hope this week treats us better than last week did. Weeks with a holiday are usually crummy.
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