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 advisers prior to making any investment decisions based on information on this website.
A little earlier today I noticed that my Morningstar stock (I do not do this automatically) had hit an appreciation target on the upside, passing the 120% appreciation level. (As you probably know, I use targeted appreciation levels after stock purchases to sell portions of my holdings.) I had sold Morningstar (MORN) shares 3 times previously, thus my target was at a 120% level (the first three levels being at 30, 60, and 90% appreciation points.) I sold 1/7th of my 120 shares which worked out to 17 shares at $71.89. These shares had been purchased 11/22/05 at a cost basis of $32.57. Thus, I had a gain of $39.32 or 120.7% since purchase.
Since I was under my 20 position maximum, this sale at a gain gave me a "permission slip" to add a new position to the portfolio. I did purchase shares of U.S. Global Investors (GROW)....more of that later.
When would I sell next? On the upside, my next targeted level is at a 180% appreciation point. I go with groups of four sales and then increase the interval by 30%. Thus, 30, 60, 90, 120, then 180, 240, 300, 360, then 450% etc. At that time, I would also plan on selling 1/7th of the remaining shares of 103/7 = 14 shares at 2.8 x $32.57 = $91.20. On the downside, after a 120% partial sale, my new targeted sale point would be at 1/2 of that appreciation level or at a 60% appreciation from purchase which works out to 1.6 x $32.57 = $52.11. At that level, I would plan on selling ALL remaining shares. Much like what I did with Bolt (BTJ) which retraced to 1/2 of the highest prior appreciation point.
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