Don't Open Until Christmas

Kunal
Desai
October 2, 2009
How to trade stocksbows-opengraphTrading-Watch-List

Overcoming the fear of a down day, or a down series of days in a bull market can be somewhat difficult for most people.  Just know, that in a bull market, as in any market, I study the fundamentals of the companies which interest me. — When the market is fundamentally strong, like this year, I seek and invest in undervalued companies and I hold them long term.  

I am about to share some images with you – for no other purpose than to explain to you how I deal with the psychology of fear on a bearish week like today.  I’m not full of shit, I don’t make up large positions to “look cool” – and I’m human.  None of us can predict the market, so why bother trying?  I don’t…

So as many know I started adding $SYNM, first cycle, between $1.68-$2.60.  I sold my entire position in the 3’s and I felt naked without Syntroleum in my portfolio.  I had around 45k shares at the time, made well over $40,000.  

I know this company well, and I believe it has huge potential in the future.  So I’ve been rebuying this stock from $2.50-$2.85.  I currently hold a fairly significant position in my long term account, and also in my trading account.  Below is an image from my trading account, be warned if you have a weak stomach you may not like this position 🙂  

Needless to say I tend to hold more in my long term accounts.

A similar story with $NEP, I’ve been buying this stock from the high 3’s to mid 4’s.  I sold some in the $6 range but kept a long position.  I also added a bunch into my trading account as you can see by the image below.

Now, how on earth can I sit on positions that are down some $24,000 without worrying?  Simple.  I am a long term investor, I don’t buy on margin unless I can afford to cover. I keep around 80% cash on the sidelines (which includes my long term/retirement and trading portfolios).  If I need to add cash I can, but I usually don’t have this problem.

Take today, for example.  Some time ago I bought $YGII/$YGYB in the 5’s, and eventually $YONG (same company, series of uplistings, etc). I put the position from the 5’s in my long term account, then on September 9th (less than a month ago) I added 15,000 trading shares of $YONG at $7.  It went up and down, sometimes red days, sometimes green.  Overall I held strong until today.  I sold the entire trading share position only (keeping my long term position) in the 9’s.  I made over $45,000 in less than a month in a realized gain.

So I view my trading account as a Christmas Tree.  I have red and green lights on it – obviously we prefer all green all the time, but this is never the case.  The only difference between me and most people is I don’t trade in my red lights for money — I usually add to the strong positions on red days like today.

Today I added $NEP, $SYNM, $AGM, $TRIT, $CYCC (more risk on this) into my long term portfolio.  I also took another new position of $SWHC under $4.50 in my trading account.

Today was like Christmas for me all over again.  Remember, if you don’t let the fear of “red lights” consume you, you’ll do just fine.  If I dumped $NEP and $SYNM today I’d likely hate myself in the future.  By the way, I’m also holding my position of $BEST in two accounts – full on – we’ll see how that turns out next “Christmas”.

Good luck guys, hope this makes sense.

Subscribe to newsletter
By subscribing you agree to with our Privacy Policy.
Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.
Share