Short Term Trading Weekend Lounge: 29 - 31 July, page-235

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bratt90

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31/07/16

19:14

Post #: 18411209
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Originally posted by forrestfield ↑

Weekend topic:
I have couple of points to add... not that I know much but may be it helps..

1. I have learned over the years that I should only invest in the trendy sectors... Whatever market likes and that's pretty much it... Although I still go and there to find value but better and quicker rewards come from the stocks in the right sector...

2. I try to find stocks which are trading at value... so something which is at fair value in comparison to peers... For example when the tech boom was hot and every body is investing there I tried to find some stocks which were trading with market caps below 10m... and avoided the ones which have made larger gains... Like ZIP was a favorite stock around 70c and with the rapid downloads I even thought it will do $2... However, I kept myself focused and never touched it though it doubled from that price... the moral of the story is... try to get in low... it helps in 2 ways: i) profit margins are really handsome like buying ZIP at 20c would have generated heaps more than buying at 70c... ii) protecting capital is as good as making money... Yes, its boring but it wins the ultimate battle... means if you are not sure about something perhaps its not for you... rather than buying it, perhaps do more work to find something else which might make sense... and its simple...
I know its hard not to fall for hype and avoid things when every body is taking about it particularly the ones making no sense to you... I mean there are 2000 plus companies at asx and at least 30 plus make large gains each month... that means you 1 chance of finding a winner every day... even if you are as slow as I am you still got a chance finding a winner or two every 6 months... Now lets imagine we are working hard to protect our capital and not risking it irrationally... and then trying to find a winner or two keeping in mind proper diversification (diversification means IMO not going nuts and buying 20 stocks with 20k lol, it rather means manageable diversification which means few stocks which we can follow on daily basis like a hawk)... This will ultimately provide handsome returns IMO...
For example, we can see this from the 5 grander approach adapted by different STT folks... One thing which I have noticed that all of us are going for value keeping in mind short term approach... but nothing crazy... At least that's what I did... However, I still do some stupid stuff in my personal portfolio lol...

3. Lock in profits but don't go blind... For example, if you have made 5 bags plus like many stocks did during the tech boom... take the money and run... 500% return is huge... yes you can make 1000% but there is no limit of greed... or perhaps set your targets and keep locking in some as you keep making money... By saying this, don't go blind which means don't shot yourself with a quick 30-50% gain when you can make 100%... so let the runners run to a point where they stop making sense... so huge market caps without any revenues, business models and profits... what we saw in tech boom and many booms before... All in all, let the runners run when they start running and dump them when you see a weakness or when the market cap does not make sense...

In a nutshell, I am trying to teach myself to stay with the market which means investing in right sectors keeping in mind value... I am also trying to learn simple way of doing things... so small market caps good cash and a decent project or looking for one...

Cheers

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Short Term Trading Weekend Lounge: 29 - 31 July, page-235

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White Cliff jumps 24% on 'bonanza grade' copper rock chips at Rae project, Canada

Actinogen Medical ramps up Alzheimer’s treatment trials, targeting fast-track global approvals

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Short Term Trading Weekend Lounge: 29 - 31 July, page-235

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