CLICK HERE FOR MY PODCAST ON THE HELIX SALE AND I SING A SONG 'THE FOX' ;)
Hello Friends! Thanks so much for stopping by and visiting my blog, Stock Picks Bob's Advice. As always, please remember that I am an amateur investor, so please remember to consult with your professional investment advisors prior to making any investment decisions based on information on this website.
One of the peculiarities of my portfolio management system is my approach to selling stocks. I sell stocks, as most traders do, on basically two situations: either on "good news" as my stock market appreciates in price in which case I am selling partial positions--usually 1/6th of my holdings; or on "bad news' which means that the stock has declined from a certain point and given me a sell signal.
I have three points at which I plan on selling a stock on "bad news": either at an 8% loss after an initial purchase, at "break-even" if I have sold a partial position of the stock one time (usually at a 30% target), or at a 50% retracement of the highest sale point on "good news". The last sale may be the most complex to explain. But it really isn't that complicated. If I have sold a portion of a stock at 60%, then I sell all of my remaining shares if the stock retraces to a 30% appreciation point. This goes on for all of my partial sales. In the case of Helix Energy Solutions (HELX) (the former CalDive), I had sold the stock four times (!), with the last sale being at a 120% appreciation level. Thus, my targeted sale of all of my remaining shares was at a 60% appreciation point. The stock passed that point in the last day or two and is actually moving higher today.
A few moments ago, I sold my 142 shares of HELX at $29.84. These shares were acquired 11/3/04, at a cost basis of $19.10/share. Thus, I had a gain of $10.74 or 56.2% on this sale. However, after the initial purchase I made four sales at gains, selling 50 shares on 2/25/05, 37 shares on 8/1/05, 28 shares on 11/22/05, and 28 shares on 1/12/06. Thus with four sales, at 30, 60, 90 and 120% gains, my targeted sale point on the downside was at 60% appreciation. Coming back from a few days away from the market, I realized that HELX had passed that sale point, and this morning, remaining under the 60% appreciation point, I went ahead and sold my remaining shares.
Fortunately, stocks are trading a little healthier today, and I may soon be able to add a new position instead of continuing to unload my portfolio at targeted sales. But in the meantime, I shall continue to strive to maintain trading discipline and follow the rules that I have established for my portfolio.
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