After 2+ years of blogging on TT, it's clear that double-digit returns are not only possible, they're commonplace among traders here.
Which leads me to question traditional views re 'risk management.'
(a) tof has a talent for identifying stocks/ETFs about to take off.
(b) Mark plays positions the same way he plays high-stakes table games.
(c) David has taken a few hits to the solar plexus lately, but he's still standing- and earlier in the year had several fantastic runs.
(d) Perhaps the most risk-averse player this year, even I was able to nail a +10% trading gain between November 23 and December 2 basically using the SPX.
Let's face it- trading with the support of proven blogmates is a relatively new phenomenon. We may find out several years hence (once the phenom inspires a research paper) that 'blog-supported trading' can reliably escalate returns.
Up to this point, I've been content to trade my own positions, while watching trades initiated by blogmates from the sidelines. I'm going to start tracking your trades more closely, and find out whether I'm able to turbocharge my returns by piggybacking on your ideas.
Happy New Year! Don't forget to down copious amounts of your favorite mind-altering substance.
Happy New Year, friends!
ReplyDelete"blog-supported trading" is really a great idea, since different people naturally have affinity for different trading/investment vehicles and thus placing a few chips into securities your blog mates have identified as being noteworthy will at least give you a nice risk diversification, EVEN IF those picks turn out to be no better than S&P in the long term. In my case, for example, I still have $9K parked in CSTR, which basically saved it from destruction in AUMN over the past few months. Thus, if shit hits the fan (again) in the junior mining sector and AUMN makes a new low and I get a margin call, I'll be able to "withdraw" that 9K from CSTR and use it to satisfy the margin call. Risk diversification.
ReplyDeleteWell said 2nd!
ReplyDeleteCongrats on the great year Mark in such a tough environment - nice work!
ReplyDeleteGreat start in EU. Any news? DAX +3%.
ReplyDeleteYeah I saw that too Mark. Not sure if there is any news other than people thinking things will get resolved.
ReplyDeleteAny of you guys follow MAKO? It's not time to buy yet but it's been on my watch list and I noticed that it has fallen quite a bit. I would be interested in it at $15.
A nice summary of 2011 events...
ReplyDeleteIBD chart depicting 2011 Headline risk
Submitted by NYUGrad #103066
http://bit.ly/vMZHih
DAX +3%- is there a Tuesday trade here?
ReplyDelete(a) XIV. Inverse volatility.
(b) Or VIX. Rebound in volatility.
(c) Short USD/long Euro.
(d) Long GLD/SLV/miners.
(e) TBT.
(f) Rebound in US indexes.
(g) Rotation out of US into Eurozone.
A +3% gain in the DAX was unexpected, no? There will be some reshuffling of ST opinions.
7:49 AM Helping the positive tone in Europe is Germany's December manufacturing PMI, rising to 48.4 ahead of an earlier estimate of 48.1 and last month's 47.9. The rise halts an unbroken string of declines going back to April, though Markit's Tim Moore notes manufacturers as saying the falloff in European demand since the summer has spread to emerging markets.
ReplyDeleteLong time, no see guys. Congrats to TOF and Mark on an EXCELLENT 2011! 2nd, 2012 will be your year of glory. No doubt.
ReplyDeleteI spent the past few days trying to get a handle on 2012. I have never been so bullish. Time to get back to trading. I just posted my reasoning for an explosive rally in 2012. Enjoy.
http://explosiveface-rippingstocksmorgasbord.blogspot.com/
Great stuff Jesse. Hope you’re doing well out there.
ReplyDeleteI also believe there is at least a better than average chance we see 1,500 this year, much to the chagrin of every trader out there looking for once in a lifetime opportunities like 2009. Ain't gonna happen. Well, actually it is happening but in unloved sectors like financials and coal...i.e., stocks like BAC/BTU/HIG. I think BAC could end the year 200% higher if we get to 1,500.
However, if we get a face ripping rally to 1500 then the high fliers will fly high again...and stocks like TZOO, OPEN, and MITK should all do well. I’m all in on MITK right now as I see a big rally in the works up to $20 this year.
Jesse - your article perfectly explains why the DAX was up 3% today and why the CAC was up 2%. Europe is falling apart right?
ReplyDeleteGreat stuff Jesse!! Good to see you pop in again!
ReplyDeleteTOF- You just asked me about some trade ideas. Here is my list of interesting chart patterns:
ReplyDeletedang cnam sol gmxr sol smsi rdn rf jva ctcm zolt amsc jdsu axst aumn jva hov egd mtl vit cis osg gmxr wfr exm pcx csiq fslr aci open ssri hsol noiz cvv shz cis ccih exm tk c gnw pmi tan sol tsl gmr peix swc yge
I'm very interested in and would like to do much more research on WFR, RDN, AUMN, JVA, MTL, OSG, PCX, JRCC, BTU, ACI, FSLR, SOL, BAC shippers, solars, and banks.
I forgot about ANR. Its my favorite chart pattern heading into 2012, but I'm still trying to figure out a discrepancy in its forward projected earnings vs. a few of its peers, notably ACI.
ReplyDeleteOooh I love ANR's weekly chart
ReplyDeletehttp://www.reuters.com/article/2011/12/30/us-ethanol-brazil-tariff-idUSTRE7BT0Z620111230
ReplyDeletePEIX could be very interesting...
PEIX is profitable and recorded the ninth consecutive quarter of growth in total gallons sold back in late October...on the downside, PEIX has increased shares outstanding about 10 fold from 2006. last quarter they did $.12 EPS but shares are now about 70% higher than the number used to calc EPS in last quarter. Using the higher Shs # would result in EPS of $.07 last quarter. Still great considering the company trades at $1. This quarter should be even better considering they now own even more of their plants (they bought about 15% more of the plants in the past couple of months from what I gather) so perhaps they could do $0.12 again, which would equate to a $0.48 EPS run rate. I would think the market could get giddy and trade it up to as high as $10 in a panic euphoria if that happens.
ReplyDeleteInteresting Analysis...
ReplyDelete"Is the Stock Market Cheap?"
http://advisorperspectives.com/dshort/updates/PE-Ratios-and-Market-Valuation.php
Retail - SHLD is now 1/10th the mkt cap of Costco and if you add them together they pale beside WMT. Like 2/3rd the size. I remember the 1970's/80's when K-Mart was overtaking Sears and Wal-Mart was only in the small towns and Costco was unknown. COST still does not have a store in Peoria, IL. WMT has four in the region including a Sam's Club. Sears and a K-Mart hang on.
ReplyDeleteFor any holders of miners, http://peterlbrandt.com says they are cheap in relation to bullion.
ReplyDeleteI am 64% cash (78% if you consider PHYS as money). Wary of the next hit from the Eurozone fallout.
"Expert: Wastewater well in Ohio triggered quakes"
ReplyDeletehttp://finance.yahoo.com/news/expert-wastewater-well-ohio-triggered-234802837.html;_ylt=AqD257R631Pit1Di57hc_RCiuYdG;_ylu=X3oDMTQ0bGszYTl0BG1pdANGaW5hbmNlIEZQIFRvcCBTdG9yeSBSaWdodARwa2cDZTI0YTZhMDYtMmE5ZC0zMWNlLTk3OWEtM2RiODEyYzQxNzlmBHBvcwMzBHNlYwN0b3Bfc3RvcnkEdmVyA2QzMWUxZTEwLTM1YjMtMTFlMS04ZWZmLTA5YzQyNjNkMjZjNw--;_ylg=X3oDMTFvdnRqYzJoBGludGwDdXMEbGFuZwNlbi11cwRwc3RhaWQDBHBzdGNhdANob21lBHB0A3NlY3Rpb25zBHRlc3QD;_ylv=3
Yeah, I've followed this CP. First time the well is to blame for the quake. Crazy...Thanks for the link.
ReplyDeleteMark- Let me begin by saying I'm on vacation this week- so a 9 pm post on Monday need not alarm.
ReplyDeletejesse- Welcome back! I've been wondering about your whereabouts since the floods in Thailand. I just finished reading your latest commentary (http://explosiveface-rippingstocksmorgasbord.blogspot.com/). Man, that is one awesome post! I'll need time to get my head around the bull case- I think it happens in 2012, but not without a downside set up.
Kyle- Hulbert updates Shiller's CAPE from time to time. And the relatively high current P/E10 (as Short calls it) is kind of a nagging concern.
We spent the day in Gold Country. Placerville, followed by Coloma. Picked up a few wall decorations for the house, and walked around a couple of restored/preserved mining towns.
ReplyDelete2nd - I think the main thing that supports the bull case is to consider how much crap has been tossed at the market over the past 18 months...and in this time the market has moved UP.
ReplyDeleteFTEK looks like a buy if it can recapture the 200 DMA.
ReplyDeleteDavid- Gold/silver appear to be rocketing higher again tonight.
ReplyDeleteSo it's a stay-cation.
ReplyDeletetof- I'll keep an open mind. I know better than anyone that the markets couldn't care less what I think.
ReplyDeleteIn fact, I like your take on financials, including the FASt break set-up.
ReplyDeleteWelcome back, Jesse! Great take on 2012! I will forward it to my friends as an example of the kind of analysis one should do about the broad equity market.
ReplyDelete2nd_ave, gold and silver are indeed having a blast tonight! Even if they were to stay flat, however, I think the junior miners are ready to move up.
ReplyDeleteSince December 15, GDXJ is flat DESPITE the fact that SLV is 4%. Since December 23, GDXJ is up 1.5% DESPITE the fact that SLV is down 5%. (I am looking at SLV instead of GLD because GDXJ has a much higher correlation with SLV than with GLD, because SLV and GDXJ are both considered much riskier sectors than GLD, which is often treated as a safe haven). Isn't this the best "tell" for us that the worst has already been priced into the miners? It's the market reaction to the news we should watch, with the "news" here being the change in the price of SLV.
So I think putting some money on the line here, through GDXJ or better yet through a junior miner that *outperformed* GDXJ since December 15 (SVM, AUMN, or something else) is going to be a worthy trade.
http://216.105.249.165/Mobile/news?id=437343760
ReplyDeletenow i know why coal stocks r beaten down. im avoiding these suckers...they may bounce but not as much as others...
RB- Nice breakout for PXP.
ReplyDeleteI bailed on about 3/4 of my MITK between $7.25 and $7.45. I'm throwing in the towel probably at the bottom...
ReplyDeleteI knew that was you.
ReplyDeleteha yep. i'm sick of watching this thing fizzle out. plus i need to keep risk lower with the whole job situation.
ReplyDeleteYell me about it.
ReplyDeleteApparently wind power isn't completely dead:
ReplyDelete1/3/2012:
"Suzlon Wind Energy Corp., the North American subsidiary of Suzlon Group the world’s fifth largest wind turbine maker*, today announced the sale of 57 Suzlon S97-2.1 megawatt (MW) wind turbines for a large wind energy project located in the western United States."
http://www.suzlon.com/images/Media_Center_news/203_Suzlon-120-MW-wind-power-project-western-USA-final-final.pdf
Mark - I also really like the upside in PEIX...although I will definitely take a smaller position in that if I buy it. And I like the setup in JPM/BAC/RDN. Really all financials.
ReplyDeleteVery disappointing action in MITK...I love the story but I can't ignore the way it's trading. What a bummer.
ReplyDeleteWell, I'm glad I wasn't short anything to start the year off...
ReplyDelete"A breakaway gap occurs at the beginning of a market move - usually after the security has traded in a consolidation pattern, which happens when the price is non-trending within a bounded range. It is referred to as a breakaway gap as the gap moves the security out of a non-trending pattern into a trending pattern.
ReplyDeleteA strong breakaway gap out of a period of consolidation is considered to be much stronger than a non-gap move out. The gap gives an indication of a large increase in sentiment in the direction of the gap, which will likely last for some time, leading to an extended move.
The strength of this gap (and the accuracy of its signal) can be confirmed by looking at that volume during the gap. The greater the volume out of the gap, the more likely the security will continue in the direction of the gap, also reducing the chances of it being filled.
While the breakaway gap generally doesn't fill like the common gap, it will in some cases. The gap will often provide support or resistance for the resulting move. For an upward breakaway gap, the lowest point of the second candlestick provides support. A downward breakaway gap provides resistance for a move back up at the highest price in the second candlestick."
UXG and PAL - Wow!
ReplyDeleteGL ladies. ATC.
ReplyDeleteBought starter position in PEIX and RDN...only about 20% total between the two. PEIX @ 1.095 avg and RDN at $2.305 avg.
ReplyDeleteBought starter positions in PEIX at $1.1 avg and RDN at $2.305 avg. Still about 80% cash.
ReplyDeletesorry for double post.
ReplyDeleteWatch natty guys. new monthly low (which it had to make prior to reversal)
ReplyDeleteoil to gas ratio hit 35 (6-10 historical band)
Possible hammer bottom in play across all natty etfs (especially my signal- GAZ)
Just sold ANR and ACI. Legging 330% of portfolio into UNG.
When it comes, the eventual run will be unlike any other commodity run we've seen.
PEIX: Finally, a stock with a chart. A bit soon to see the re-emergence of the trend since it pulled back for so long, but I traded this one before being stopped out. It was one of the Landry service picks on the initial pullback in November.
ReplyDeleteEntry $1.40 if it triggers.
Bowtie in place, good C&H pattern(if a little deep on the pullback) and a kiss of the 50 dma.
Caveat: IF IT TRIGGERS!
CC - Good to see u like PEIX. Now let's get it up to $1.40! I'm happy with a starter position in the stock on this pullback on low volume. I believe the fundamentals for ethanol (strong domestic demand due to government mandates, strong export market, high oil prices, steady revenue growth over past several quarters, and cheap valuation if last couple of quarters earnings continue) warrant a big move higher.
ReplyDeleteJesse - Why UNG man!?!? That's a widow's maker.
ReplyDeletePEIX: Look behind this thing! Was $7+ in the last 52 wks. A gradual decline with no horrible memories, maybe a hair if resistance at $2.60-$3.50. $1.09 to $6-$7 would be a horrible problem, wouldn't it? With a low cost start and a decent position size the potential is substantial and the risk is defined. It can only go to zero. I would take a position risking 2% (if stopped out) and a price target on half the position at 2.60, then set the stop at break even and leave it alone. Maybe add half back on the break above $3.50 on a pullback.
ReplyDeleteSVM - The double bottom reaction high of $10 in late October, added to the difference between reaction low and high of $6, provides a potential upside target of $16...
ReplyDelete