Always invest from strength even if you are scouring the biggest losers list. So for me that's Relative Strength on a down day and that's why I'm looking at CLN today....... Well Biobottom $3.48 became $4 pretty quick didn't it?See how you can use RS on even the WORST days! Now who else in the MFing world could of made you 12% yesterday & today? If there's another trader out there who can do that without leverage and without going short on a DOWN 400 point day let he or she stand up now! Since I'm crazy I just bought 3000 @ $4 and I expect to sell at $7 in a few weeks. Why $7 I have no idea!
thank you., Ben! with $1000 buys, the $10 i pay is 1%, but that goes down proportionally with larger trades. figuring in commision would make the calcs more complex, but yes, that did cross my mind. commission is an insignificant effect for my trading (usually), and also there is no extra set of entries on a Schedule D because pretty much all my trading is in IRAs. OTOH ... there was a systematic error in my calculations that nobody remarked on, which ALSO becomes more significant (like commissions) when the trade sizes are relatively small. that is, you can't trade fractional shares. so, because it's only a 0.5% chance (for a $2 stock) that a whole number of shares will be bought with $1000 (and less with larger trades size), you're always buying less than tha "$1000" of stock, so the numerators in the final calculation are less than $4000 or $5000, which would LOWER the average buy price if it was factored in. how much? you can do the math. the "whole share effect" is a small effect, inversely proportional to the size of the buy and also inversely proportional to the share price (cost/price). the fractional share effect would move the average lower, while commisions would raise it higher. by how much? it depends on the stock price, size of the buys, and commission. i see it as a wash with one effect cancelling out the other. good enuf for guvment work we used to say. in my case, after the 88% gain on CBLI and seeing it collapse further and further after i got out, i felll prey to the "separate accounts" fallacy which is what makes a gambler take riskier bets when they just scored a win. it feels like they're playing with the "house's money" which is actually now THEIR OWN money and should be guarded as carefully as if it was coming from anywhere. [ i'll check it out and get back to ya! and ditto for BSD Medical. the two alternative-fuels stocks on i've been following are XNL (turns garbage to biofuels) and SUF (they claim that "sono-cracking" turns heavy oil into the more desirable light sweet kind). i think Mark Cuban is saying SUF is a fraud and he's shorting it and bashing it. i think. he's not always right but he CAN kill a small stock regardless. if you look at worldwise oild reserves, most of it is in the heavier grades of oil, with the HUGE oil-tar sands of Canada. if someone can come up with an economical way to turn tar into sweet crude, they'll make a mint. have you ever looked at SUF and XNL in that space? yesterday? i bought ASEI on the selloff that started before the DJIA collapsed at 3 PM, but intensified from there. homeland security with a new-fangled imaging technology that distinguishes material by atomic number (in shades of grey) so plutonium, uranium, and lead would all be black, which could set off an alarm based on computer pattern recognition. TSA stopped groping people's breasts after they got a lot of complaints. ASEI was picked by Motley Fool as their best choice for a small-cap winner this year in one of their areas, though they've split into so many pieces, it's more accurate to call them the Motley Fools (plural). looks like i have to lick my wounds from not selling a few stocks when they had unrealized appreciation and have now swooned. my risk capital is getting low. and i needto take a rest. i've been getting into a state of nervous exhaustion over the stock market and my trading. time to take a break. i'm not logging in to Ameritrade now to get RT quotes and look at L2. delayed quotes from Yahoo with my watchlist of stocks and their quotes and news is good enough. i really reached a state of total nervous exhaustion over CBLI and then COR. it's like i LOST MY MIND. and ... ummm ... that's kind of the reason i don't work on nuke safety anymore ... and to heck with anyone who figures out who i am ... small world, it is. send me a PM if you want to communicate without posting it. nobody else here seems to be interested in COR or our stock picks.
ok. i'm hoping to find a strategy that minimizes my worry and anxiety. that Monday that i was in a love-struck fever to buy COR it was like i had lost my mind. i woke up just a minute after the market opened and i hurried to log in to my account and do some heavy buying and was making decisions in the fogged haze of a caffeine-dependent person without their morning java. i saw that small opening gap up and the spike up to $1.98 and thought that it would keep rallying. well, i was not the only one. i had plenty of company for about 40 minutes until we bought as many shares as we wanted to ... only to see it crash to $1.78 and then $1.60. so. on the weekend before the Monday open this week, you, topdown, and me all seemed to agree that COR would almost surely trade between $1.90 and $1.60 with little chance of it going to $1.50. the market action matched up pretty well with our predictions. so ... what can i learn from this? hopefully, it will give me an aproach that would have bought my shares for $1.70, while being on auto-pilot. i want to develop strategies that minimize my worry and maximize my returns. and as is very obvious. i get anxious and i over-think things. it's draining to watch the L2 and T&S all day long to try to find the best entry point. it's a waste of my energy. heck, here's how anxious i get if my internet access goes down. besides having a backup PC with all the software i need for trading on a notebook PC, i bought a WiFi antenna for $15 so that in the event my DSL went down i can have my desktop poach on my neighbor's open WiFi, with most of them on cable modems. the antenna sits on top of the router (though i could stick it in an open window) but without putting it in an open nearby window, i can turn off my own DSL and get a snappy response when logged in at ameritrade with streaming quotes, etc, for 30 stocks. there are some hiccups as it changes from one connection to another, but there are at least 4 or 5 open WiFi connections i can get to with a 10.5-inch antenna. ok. i'm just mentioning that to let you know how i am prepared for trading without having to use dial-up incase the DSL goes down. and as a software developer i have a backup PC also. so i prepare for things going wrong, which is a big part of being a risk analyst. back to COR. i'd want to buy at $1.90 and would buy bigger chunks if the price went down, and i picked the 10-cent point because of the chart. well, that's how i saw it. so how could i have done much better and had less stress over it? i could modify my dollar-averaging method to increase the size of my buys as it went progressively lower. so, with my $10 commission factored in and the fractional share effect factored in, i calculated the average buy price i would have achieved (so far with plenty of trades going off at $1.60 and it not reaching $1.50) if i had pursued with the following limit orders, to buy $10,000 of stock in total: $1000 @ $1.90 $2000 @ $1.80 $3000 @ $1.70 +$4000 @ $1.60 --------------------- $10,000 spent on stock. I'll factor in both the $10 commission and the fractional-share effect, and it will show that the commission added $40 to the cost basis, while the fraction-share "saved" $2. All in all, the $40 commission paid is 0.4% of the total cost (and raises the cost basis as comared to free trading by that amount. Here goes, assuming i want to invest a total of $10 K on COR spending no more than $1.90/share and lose no sleep over the volatility, here is what i SHOULD HAVE done Sunday night, which was in line with my chart reading and my take on the news, assuming a $10 commission for each buy and factoring in the (insignificant @ < $2) fractional-share effect: $1000 @ $1.90 buys 526 shares for $1009.40 $2000 @ $1.80 buys 1111 shares for $2009.80 $3000 @ $1.70 buys 1764 shares for $3008.80 +$4000 @ $1.60 buys 2500 shares for $4010.00 TOTAL ------ ------------ 5901 shares for $10038.00 So $10038.00/5901 shares means average price was $1.7011. And that price is lower than the $1.78 you chose for your entry point, which was $1.78+, because of your $8 commission. So my avarage buy price would have been lower than yours by about 5%. And i could have slept through the open and not worried about it. And i would be able to watch the ups and downs without having that sinking feeling, because i knew the the lower it went, the more shares i'd be buying, and it was whip-sawing so fast and unpredictably just watching the TS and L2 made me need a Valium.
Ha. I just did something that will add greatly to my peace of mind. The home page of my web browser is set to a customized my.yahoo.com with my stock portfolios (# of shares and cash), and it has been showing a $ number at the bottom which has been hard to look at this week. It was like a drug high to watch it climb as my 5000 shares of CBLI were being held onto as it reached $13.99 ... and then ... down ... down .... down. I have been letting the market determine my mood. That is a very unhealthy approach to trading. Sure, i liked the "high" of seeing that big number when CBLI hit $13.99, and i remember having that gut urge of feeling that it's simply too good to be true. but on the other hand, i thought that this time i'd Let My Winners Run. and the best way to do that would have been with a trailing % stop order. If i had put a 7% trailing stop in place on Wednesday afternoon when it was at $13.50 and climbing, i would have gotten stopped out at $13.01. 93% of $13.99 = 13.0107. I need to do something like read a book instead of obsessively following my stocks. So ... i just went and checked the box for: "Don't show portfolio total value on your My Yahoo! pages." Now it won't bum me out to see that value and compare it to what it was exactly a week ago.
CBLI is up 18% now to $10.89. i just wish i knew why they're buying this stock. there has to be a REASON. http://finance.yahoo.com/q/bc?s=cbli&t=5d
Biobottom it's all my buys going off at $9 1/2 go back on this board I know I asked or begged you guys to hold a gun to my head at $9 1/2. Luckily these computers can buy by themselves with limit orders! CBLI snaps back a $1! Just a bounce though I sold.
Hey Bio- well it was a bit sloppy at the end of the day on the 28th I got filled. Then the next morning it opened lower and I jumped out scared. Then the next day it rallied up and crossed the $9.50 again in the morning so I went back in on the upswing and it was $10.45 by noon and I exited shortly thereafter. for a $1 gain. For all the fear involved it certainly wasn't worth it.
It's possible today to go back in CBLI at $10.50 I think it may stabilize there and resume it's assent. ~stoney