Yesterday we bought Apple (AAPL) after having reduced our position by virtue of ETF trades a little over two months ago. We executed the trade for "large" accounts, with large being defined as being large enough where mostly individual stocks in 2-3% weightings make economic sense, and for the AdvisorShares ETF that our firm subadvises.
You can read more on the particulars here in an article I wrote for theStreet.com. Not included in that article that we bought early in the day so the average price, relative to the day was not good.
I write regularly about not succumbing to emotion with investing but that doesn't mean there won't be tough days. This trade was planned out when we sold in August when there was no potential for emotion and yesterday we executed a strategy that has worked for us far more often than not. This is a pattern we have traded before where we have sold some form of over excitement and then buy back in when things look less one-sided. This is not the only type of trade we do but is one we have done before, Statoil (STO) as one past example of this.
There was no precise reentry point in mind two months ago but the stock fell a lot in a short period of time and combined with what looked like panic yesterday made for a good time to execute the trade.
Where an actively managed portfolio is a series of decisions some of which will turn out to be right and some wrong. I say this on just about every post that discloses a trade and this one is no different.
Proud Member Of
Random Roger
© 2009 | Gadget Theme Blogger Template
Original WPtheme By Blogger Template | Converted By Gadget Lover
| Distributed by eFree Blogger Help
Original WPtheme By Blogger Template | Converted By Gadget Lover
| Distributed by eFree Blogger Help
4 comments:
Hey Roger Do use your rule as faling below 200 day average as being a sign to be defensive for individual stocks also.
not so much, it is more of a tool for the portfolio. the 200 DMA has influenced individual stock purchases before but I use it more subjectively with stocks versus the broad index which is a strict discipline.
You should write about the fiscal cliff. What nonsense
We always need a new budget. Congress always passes a new budget - eventually. It does not take that long after a new budget is needed until they pass one.
Whether you like the new budget or anybody likes the new budget does not matter. It will be passed.
Don't let everyone get scared by the fiscal cliff and do something stupid with their portfolio. The fiscal cliff (budget) will come and go - eventually - and life will go on
Funny you mention this . I'm occasionally tempted by an individual stock to jump off my indexing train. Apple is the stock that has been tempting me lately.
Post a Comment