How are your investments doing?

[NorTracNY]

I'll give a quick how-to.

I find a stock that has a lot of volatility. You make money on the ups and downs, you make no money on consistency.

Say I buy the stock at $100.
I put in a sell stop at $90.
I only have $10 per share at risk with this. If the stock crashes to $90, I'm out and have a $10 per share loss. But if the price goes up to $110, I raise my sell stop up to $100. Now I'm at a break even. If the stock keeps going up, I just keep raising my sell stop up higher and higher. Once you are above the price of transaction costs and taxes, you now have zero risk in the market. The only cost that keeps going up is the marginal cost of taxes. But if it keeps going up, I'm ok with the marginal tax burden.

Then say the stock gets up to 140 and I have a sell stop at 120 and the market crashes and it hits my sell stop at 120. The tool sells all my stuff automatically and I have a profit of $20 and all I had to do is move sell stops.

There is a bit more nuance, but that is the jist. The key is you have to sell and bank profits.

OK, explain when you buy. You're talking market timing.

 

[Snobdds]

This is the latest stock I'm in. Just last week the RSI hit 30 and the MACD went positive (meaning more money was flowing in vs outflows). It was time to act. I put in a buy order at $11.00 with a sell stop at 9.50. It rallied to $25. I now have a sell stop in at 23. I bought 30K shares. I have a locked in profit of 330K in over a week. If it goes higher, I will just move my sell stop higher. I will sell when the sell stops hit.

 

[LittleBittyBigJohn]

So when you do sell, now you have a cash equivalent. What do you do with it? Presumably you would buy something else but how do you know what and when?

 

[jyoutz]

So when you do sell, now you have a cash equivalent. What do you do with it? Presumably you would buy something else but how do you know what and when?

If we knew the answer to your question, we would all be rich.

 

[Snobdds]

So when you do sell, now you have a cash equivalent. What do you do with it? Presumably you would buy something else but how do you know what and when?

It just goes back into my brockerage account and ready until I do the next transaction.

After awhile you start to get a set of stocks that have a lot of volatility. I just watch them and move when I need to. I will put in orders and if they fill, they fill and if they don't they don't.

I spend maybe a half hour a day doing this.

 

[ultrarunner]

The first thing I would need is reliable Internet… which seems to be elusive no matter where I call home…

When I worked swing I would pay my bills before going to bed… many times when the internet was ok my destination site would be down for maintenance… both local and national sites.

After last year paying property taxes and having one not go through… I went back to paying in person at the county window with time stamped receipt.

Maybe a post for Know Your Old thread?

 

[LittleBittyBigJohn]

Setting an automated sell point is smart. Probably not something I would have though of on my own. But it would require the constant maintenance that you are doing.

The majority of mine and my wife's money are in company 401ks. They do not allow the frequency of trading that you are talking about there is also a very limited pool of investment options. I do have a little bit in a couple of self directed accounts, but I have not had any luck building wealth with them by buying and selling individual stocks.

 

[riptides]

Have you read all the posts here. They are all proud of their paper gains. Not one of them are brave enough to bank the profits, and wait for a better reentry point.

How do you know their price point? Or what they are actually doing?

You don't.

 

[Snobdds]

How do you know their price point? Or what they are actually doing?

You don't.

Well they are more than willing to tell me their % gain. Since I can do math...

I take current price and multiply by 1-their % gain.

Boom...instant price point.

Just for giggles. If current price is 100 and they have a 33% gain. 100*(1-.33)=67. They came in at 67 dollars.

Rip...have many times are you going to challenge me before you learn?

 

[riptides]

Well they are more than willing to tell me their % gain. Since I can do math...

I take current price and multiply by 1-their % gain.

Boom...instant price point.

Just for giggles. If current price is 100 and they have a 33% gain. 100*(1-.33)=67. They came in at 67 dollars.

Rip...have many times are you going to challenge me before you learn?

No challenge. Do not be so full of yourself. Their paper gain has nothing to do with money in hand on their stated goal. Which is an unknown.