Nothing for today! The Stock Market Monster has decided to take a break for the HOLIDAYS. Do to the up and coming holiday's I will not return to my normal Thursday schedule until after the first of the year. Not much trading will go on over the next couple of weeks. Trading volume will be light. I will be back in action on January 6th 2011. Not sure if I can stay away that long! If I have something urgent to say I will let everyone know.
Enjoy the remainder of 2010 and have a Happy New Year!
Clay-
Thursday, December 16, 2010
Thursday, December 9, 2010
When Should I Sell My Stock?
I know many investors would like to know when they should sell their stock. Today I will explain my thought process of selling a stock and what to look for when making that important decision of taking a profit.
I cringe when I hear someone talk about how much money they are up in an individual stock and 6 months later they end up selling for a loss. This is a very common occurrence when investing in the stock market. I know! I’ve been there. When I first started investing I was terrible. I lost money because I didn’t have a clue on when to sell my stock. You must have patience when investing and be able to keep your composure when times get tough. Selling stock is a very crucial component to growing your portfolio, but selling at the wrong moment could cost you dearly!
Here is a brief list of what goes through my mind when I want to sell some stock
1. Your stock has more than doubled. As Jim Cramer would say. “Sell your initial investment and let the rest run.” You’re playing with the houses money! Hey I learned from the best (Thanks Jim) If you haven’t sold a single share when you have a gain of a 100% or more you’re being plain greedy! I promise that what goes up must come down! So please sell some stock.
2. Sell a percentage of your holdings if a stock runs up to far too fast. Many stocks run up from the trough (bottom) to peak (top) over a period of weeks in excess of 20%. I don’t know what it is about 20%, but I have seen a stock go on a great run and then suddenly run out of steam at the 20% mark. (Key moves 10%, 15%, and 20%.) I guess fund managers use round numbers. I always take some stock off the table at 20%. I never sell all my stock at once, but it’s imperative to lock in a profit after a 20% run.
3. Continuing on with the 20% move, I would like to add that I pay close attention to a stocks chart on this one. I don’t care what price I paid for the stock I will sell a portion of my holdings after a big run. I wait for the stock to pull back and then I enter back into the stock at a lower price. Buying and selling keeps me on my toes and forces me to pay attention to my stock like a shark.
4. Always sell into strength. It feels so good to sell when a stock is up. Don’t try to time the top of a move. By the time you try to figure that out the stock will be down a couple bucks ($$$). You’re trying to make money here! Stay focused on the task at hand. Sell when others are buying and buy when others are scared! This is how you make money. If everyone knows about the stock and its being hyped on the TV and Internet, I hate to burst your bubble, but the big money has already been made! Move on and find a better money making opportunity.
5. Always sell if the reason you invested in the stock changes for the worse. Business changes rapidly and when the outlook changes for a company in a negative fashion, run for cover! Shoot first and ask questions later. Sell immediately and sit on the sidelines to process the new information. You do not want to be caught in an out of favor stock. It will sink like a rock!
6. Sell when your portfolio value becomes over weighted in one stock. You don’t want to have too much money in one individual stock. It’s okay to have a couple of front runners, but keep it within reason. Example: if a single stock consists of more than 50% of your portfolio a change must be made.
7. If a better opportunity presents itself, feel free to sell a stock to put yourself in position to make a profit. It’s called opportunity cost! You have to take full advantage of any opportunity that leads to an increased chance to make money off your investments. I’ve done this many times. I would sell an under performing stock and reinvest the money in a higher quality company. This really does work! Don’t be the person to wait for your stock to break even and then sell. It won’t happen! Cut your losses and move on.
Obviously, much more information runs through my head, but this list will get you started in successfully making money in stocks! I buy stocks when they are cheap and I keep tabs on them as they progress and appreciate in price. The thing is people are less willing to buy stocks when they are perceived as to high (Expensive) It’s the same concept as shopping for a car. Everyone wants a deal! I may want to buy a new BMW for $40,000, but that’s a little steep! If I talked the car salesman down to $35,000 I would be getting a deal. I would be more willing to buy the car at $35,000 because it’s a bargain and not $40,000 or the fair value of the car. You can compare stocks to buying clothes, appliances, electronics, services, and groceries. You will pay up for a bargain! At least I would. Always look for value when investing. It all comes down to the future of a company. Value is where the money is made!
Sell a little in WFT and CAT. I’m going strictly off the charts on my recommendations. WFT and CAT are in overbought territory. Apple (AAPL) has been quiet for awhile. I like the chart on this one. It’s spooling up like a turbo!
Have a great night!
Clay-
I cringe when I hear someone talk about how much money they are up in an individual stock and 6 months later they end up selling for a loss. This is a very common occurrence when investing in the stock market. I know! I’ve been there. When I first started investing I was terrible. I lost money because I didn’t have a clue on when to sell my stock. You must have patience when investing and be able to keep your composure when times get tough. Selling stock is a very crucial component to growing your portfolio, but selling at the wrong moment could cost you dearly!
Here is a brief list of what goes through my mind when I want to sell some stock
1. Your stock has more than doubled. As Jim Cramer would say. “Sell your initial investment and let the rest run.” You’re playing with the houses money! Hey I learned from the best (Thanks Jim) If you haven’t sold a single share when you have a gain of a 100% or more you’re being plain greedy! I promise that what goes up must come down! So please sell some stock.
2. Sell a percentage of your holdings if a stock runs up to far too fast. Many stocks run up from the trough (bottom) to peak (top) over a period of weeks in excess of 20%. I don’t know what it is about 20%, but I have seen a stock go on a great run and then suddenly run out of steam at the 20% mark. (Key moves 10%, 15%, and 20%.) I guess fund managers use round numbers. I always take some stock off the table at 20%. I never sell all my stock at once, but it’s imperative to lock in a profit after a 20% run.
3. Continuing on with the 20% move, I would like to add that I pay close attention to a stocks chart on this one. I don’t care what price I paid for the stock I will sell a portion of my holdings after a big run. I wait for the stock to pull back and then I enter back into the stock at a lower price. Buying and selling keeps me on my toes and forces me to pay attention to my stock like a shark.
4. Always sell into strength. It feels so good to sell when a stock is up. Don’t try to time the top of a move. By the time you try to figure that out the stock will be down a couple bucks ($$$). You’re trying to make money here! Stay focused on the task at hand. Sell when others are buying and buy when others are scared! This is how you make money. If everyone knows about the stock and its being hyped on the TV and Internet, I hate to burst your bubble, but the big money has already been made! Move on and find a better money making opportunity.
5. Always sell if the reason you invested in the stock changes for the worse. Business changes rapidly and when the outlook changes for a company in a negative fashion, run for cover! Shoot first and ask questions later. Sell immediately and sit on the sidelines to process the new information. You do not want to be caught in an out of favor stock. It will sink like a rock!
6. Sell when your portfolio value becomes over weighted in one stock. You don’t want to have too much money in one individual stock. It’s okay to have a couple of front runners, but keep it within reason. Example: if a single stock consists of more than 50% of your portfolio a change must be made.
7. If a better opportunity presents itself, feel free to sell a stock to put yourself in position to make a profit. It’s called opportunity cost! You have to take full advantage of any opportunity that leads to an increased chance to make money off your investments. I’ve done this many times. I would sell an under performing stock and reinvest the money in a higher quality company. This really does work! Don’t be the person to wait for your stock to break even and then sell. It won’t happen! Cut your losses and move on.
Obviously, much more information runs through my head, but this list will get you started in successfully making money in stocks! I buy stocks when they are cheap and I keep tabs on them as they progress and appreciate in price. The thing is people are less willing to buy stocks when they are perceived as to high (Expensive) It’s the same concept as shopping for a car. Everyone wants a deal! I may want to buy a new BMW for $40,000, but that’s a little steep! If I talked the car salesman down to $35,000 I would be getting a deal. I would be more willing to buy the car at $35,000 because it’s a bargain and not $40,000 or the fair value of the car. You can compare stocks to buying clothes, appliances, electronics, services, and groceries. You will pay up for a bargain! At least I would. Always look for value when investing. It all comes down to the future of a company. Value is where the money is made!
Sell a little in WFT and CAT. I’m going strictly off the charts on my recommendations. WFT and CAT are in overbought territory. Apple (AAPL) has been quiet for awhile. I like the chart on this one. It’s spooling up like a turbo!
Have a great night!
Clay-
Thursday, December 2, 2010
We have ourselves a Bull Market Rally!
What an excellent week for stocks! Man I love making money in such a short period of time. This is the time to get excited about being invested in stocks! All the time and effort you put into finding that perfect stock and boom a big week! I can’t get enough of this game. It’s a game leaning in your favor. It’s the total opposite of the casino.
It drives me nuts when people say investing in the stock market is like gambling at the casino. Give me a break! If that was true can someone please explain the success of Warren Buffett? The success of how he is worth over $40 Billion from investing in stocks. After that great story is told walk the street and find a gambler. I guarantee you that person’s net worth doesn’t amount to a hill of beans! Rich people don’t gamble. Remember that!
I can’t even tell you how much money I have lost at the Casino when I was in college. I kid you not; I would probably have a nice little trading fund in excess of $25,000. No that’s not how much money I actually lost, but that money would have generated some serious gains over the past 10 years. I consider going to a Casino high priced entertainment and that’s about it. Of course its fun, but it won’t lead you to riches. Investing involves educating yourself in business and how to spot trends of companies that are winning with money. You find a company that continues to grow in value and you invest your money to grow with that company. That’s it! Plain and simple.
Who says you can’t make money in the stock market? Only those that have never made a dime, are misinformed and not educated about how the stock market truly works. I don’t know about you, but 1 day of trading and I can make more money than a person can all year + some in a high interest savings account.
Example: Of course I’m going to mention one of my favorite picks!
Westport Innovations (WPRT) up 4.10% today closed at $19.30 a share
4% in one day! A savings account barely pulls 1% per year at the current interest rates. It would take you 4+ years to make what WPRT did in a day.
I will risk my money everyday of the week for that reward! The reward outweighs the risk.
2nd great example: I just sold a portion of my holdings in Weatherford International (WFT) only because it has ran up from $17.00 to over $21.00 a share in about a month.
I was in at $17.99 a share and I sold a portion of my holdings into strength at $21.29 a share. That’s an 18.3% return! Back to my first example vs. a savings account it would take over 18 years to make the money I did in a single month!
All I’m trying to say is that anyone can make money investing in stocks if they take some time to do the proper research. You have to make investing fun in order to make money. When a person is having fun they will likely pay closer attention to their investments. If you don’t pay attention you have the potential to lose a lot of money.
That being said I’m all fired up this week. Stocks are working! Jobs are coming back and retail sales were up. The after Thanksgiving sale was a hit! That is a positive sign towards recovery. People are starting to spend money.
Apple (AAPL) is working closed at $318.15 a share less than a dollar of its 52 week high
Caterpillar (CAT) working like a charm trading at its 52 week high of $88.62
Weatherford (WFT) trading at its 52 week high of $21.19 a share
Westport Innovations (WPRT) getting ready to break out! Up 4.10 % at $19.30 a share
Intel (INTC) Up over 6% this month and continuing on an upward trend higher
Money is being made!
_______________________
Now lets change gears and discuss my findings on SodaStream (SODA)
I said I was going to come back to SodaStream (SODA) after Tuesday and I’m glad I told everyone to wait to buy this stock because it was crushed on Tuesday as it plummeted down 20.6% It lost $8.60 a share. Not to worry. Remember this stock went public and closed at $24.12 on the first trading day a month ago. It was at $41.60 on Monday 11/29/10. That’s a 72.4% move. That was a perfect time for investors to sell.
Soda actually had decent numbers and I continue to believe this stock will go higher. Revenues increased 51.7% in the 3rd qtr. That’s huge! The sell off had to do with profit taking and uncertainty. With the increased exposure into the U.S. market Soda has plenty of potential for growth. I don’t want to get into all the details of the conference call, but being a new company takes time for investors to adjust to management. I can say the CFO didn’t answer to many specific questions. He gave a lot of generic answers and very little information for SODA’s future earnings. I would keep SodaStream on the radar. I’m a buyer in the upper 20’s if it gets there. Beware of the volatility! This stock is crazy!
Check out the earnings call for yourself.
http://sodastream.investorroom.com/
(Recent post on Soda)
http://stockmarketmonster.blogspot.com/2010/11/sodastream-international-soda.html
Have a great night! Man stocks are hot!
Clay-
It drives me nuts when people say investing in the stock market is like gambling at the casino. Give me a break! If that was true can someone please explain the success of Warren Buffett? The success of how he is worth over $40 Billion from investing in stocks. After that great story is told walk the street and find a gambler. I guarantee you that person’s net worth doesn’t amount to a hill of beans! Rich people don’t gamble. Remember that!
I can’t even tell you how much money I have lost at the Casino when I was in college. I kid you not; I would probably have a nice little trading fund in excess of $25,000. No that’s not how much money I actually lost, but that money would have generated some serious gains over the past 10 years. I consider going to a Casino high priced entertainment and that’s about it. Of course its fun, but it won’t lead you to riches. Investing involves educating yourself in business and how to spot trends of companies that are winning with money. You find a company that continues to grow in value and you invest your money to grow with that company. That’s it! Plain and simple.
Who says you can’t make money in the stock market? Only those that have never made a dime, are misinformed and not educated about how the stock market truly works. I don’t know about you, but 1 day of trading and I can make more money than a person can all year + some in a high interest savings account.
Example: Of course I’m going to mention one of my favorite picks!
Westport Innovations (WPRT) up 4.10% today closed at $19.30 a share
4% in one day! A savings account barely pulls 1% per year at the current interest rates. It would take you 4+ years to make what WPRT did in a day.
I will risk my money everyday of the week for that reward! The reward outweighs the risk.
2nd great example: I just sold a portion of my holdings in Weatherford International (WFT) only because it has ran up from $17.00 to over $21.00 a share in about a month.
I was in at $17.99 a share and I sold a portion of my holdings into strength at $21.29 a share. That’s an 18.3% return! Back to my first example vs. a savings account it would take over 18 years to make the money I did in a single month!
All I’m trying to say is that anyone can make money investing in stocks if they take some time to do the proper research. You have to make investing fun in order to make money. When a person is having fun they will likely pay closer attention to their investments. If you don’t pay attention you have the potential to lose a lot of money.
That being said I’m all fired up this week. Stocks are working! Jobs are coming back and retail sales were up. The after Thanksgiving sale was a hit! That is a positive sign towards recovery. People are starting to spend money.
Apple (AAPL) is working closed at $318.15 a share less than a dollar of its 52 week high
Caterpillar (CAT) working like a charm trading at its 52 week high of $88.62
Weatherford (WFT) trading at its 52 week high of $21.19 a share
Westport Innovations (WPRT) getting ready to break out! Up 4.10 % at $19.30 a share
Intel (INTC) Up over 6% this month and continuing on an upward trend higher
Money is being made!
_______________________
Now lets change gears and discuss my findings on SodaStream (SODA)
I said I was going to come back to SodaStream (SODA) after Tuesday and I’m glad I told everyone to wait to buy this stock because it was crushed on Tuesday as it plummeted down 20.6% It lost $8.60 a share. Not to worry. Remember this stock went public and closed at $24.12 on the first trading day a month ago. It was at $41.60 on Monday 11/29/10. That’s a 72.4% move. That was a perfect time for investors to sell.
Soda actually had decent numbers and I continue to believe this stock will go higher. Revenues increased 51.7% in the 3rd qtr. That’s huge! The sell off had to do with profit taking and uncertainty. With the increased exposure into the U.S. market Soda has plenty of potential for growth. I don’t want to get into all the details of the conference call, but being a new company takes time for investors to adjust to management. I can say the CFO didn’t answer to many specific questions. He gave a lot of generic answers and very little information for SODA’s future earnings. I would keep SodaStream on the radar. I’m a buyer in the upper 20’s if it gets there. Beware of the volatility! This stock is crazy!
Check out the earnings call for yourself.
http://sodastream.investorroom.com/
(Recent post on Soda)
http://stockmarketmonster.blogspot.com/2010/11/sodastream-international-soda.html
Have a great night! Man stocks are hot!
Clay-
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