Just wanted to share some thoughts after finishing sorting through my tax for the year... conclusions i think could benefit a few depending on there investing style.
I feel a lot of you are like random friends, and Hotcopper is melting pot of empires rising and falling by the minute. Half a dozen or so of the posters here are actual friends and some new friends made through introductions, Facebook group etc.
The year overall was a disaster compared to the previous FY, i miss the lithium boom of 15-16 and the easy money that came with it.
Nearly 1.5M in buy trades value and almost the same in sells, which would pale in comparison to some.
And after reading a lot of books about stop losses and strategies and psychology and how to use it to your advantage.. the list goes on. It didn't do much for the overall portfolio
Heres what i found i was pretty good at and hopefully it resonates.
I dont fear loss - i don't set stop losses per-say but if i am down 20% ill take a loss and re check fundamentals and or re enter lower or higher if it is de risked or move on altogether. Essentially i take a breather. I lost a lot of money this way. At some stages it helped me save money as the stock fell further. Some times i missed a quick rebound to bigger and better things. However i felt safer.
I am pretty good at taking quick profit if i am in that mindset, dozens of trades taking 5-10% in day or two. I personally love new release stock tips from a wide range of services, amazing to watch herd mentality and make quick $$$.
But here is where i suck big time.. on a stock that i do really well on, ill watch it go up and then greed kicks in.
GMC, a painful stock i will never forget , i made paper profit of 40k in a week, and rather than take profit FOMO kicked in.. alot of what ifs..and hotcopper chatter kicks in and.. WHAM trading halt and a six month suspension. A 40k profit turned into a 70k loss. A tough lesson.
NSL, at one point last year i was sitting on a paper profit of near 200k at the heights of late 2016, (would pale again to some holders on here) .. i have lost a large chunk of that as it has fallen this year.. key reason.. FOMO again. Steel plant / Pellet Plant/ Xinhai/Expansion..
the list goes on.
In the end by having strict selling rules when making a loss, but not strict selling rules when making a big profit , i cost myself in no uncertain terms the equivalent of a cheap apartment in Perth.
Had i sat on my hands picked some conviction stocks and done nothing i would in all honesty be marginally better right now. Another lesson learnt.
So for this FY, my rule is too always take some off the table.. a rule told many a time on this and different threads and just sit on conviction stocks again taking some profit along the way.
Moral of story, you wont go broke taking profits.
The other reality most would know is... hot copper is a snake pit at times. Awesome Researchers, Awesome Rampers, Awesome Down rampers. New posters , Old posters. Everyone including me has a vested interest. Don't let it guide your decisions.. Going through all my trades i thought back at all the different opinions that cost me money one way or another.
If anyone had a winner year, love to hear your story.
Mick.
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