My batting average

[edward]

I have one gold stock that I have held for just over a year. The rest are less than a year and as recent as a week. I have a couple of silvers that I purchased at the end of the summer just as silver started to move and I can see holding on to them for a while as well.

[hags]

I’m attempting to become a better investor. I think portfolio management is almost as important as stock picking. I’m trying to get a straight answer and keep getting vague responses.

The most precise way is to utilize math expectancy and calculate your own Kelly value which translates into how much of your portfolio you should risk given your previous results.....first off is to find out if your trading system produces positive math expectancy....once it does, calculating the Kelly value is easy and thus will allocate the max. and risk the correct amount according to the previous trades you yourself have managed....

hags

[mrmarket]

Of my last 40 picks...I sold 31 for a 15%+ profit. Of my 9 open positions, 6 of them are profitable and 3 are in the red.

That makes 37 out of 40 winners or a winner rate of 93%....how's that?

[billyjoe]

Of my last 40 picks...I sold 31 for a 15%+ profit. Of my 9 open positions, 6 of them are profitable and 3 are in the red.

That makes 37 out of 40 winners or a winner rate of 93%....how's that?

I was feeling good. Now my 73% sucks! Slowly learning from the Master.

-----------billy

[Deaddog]

Well it sounds pretty impressive but I’ve been tracking you since last Nov and in that time frame you have had 12 winners. Based on an equal position size with enough spare cash in the account to hold 14 positions the realized gain is 13.32%; pretty damn good; sure beats a savings account.

But that Old Lazy Dog, He started a portfolio with only 8 stock around the same time. Out of 7 pick he only had 5 winners. But you know the realized gain on the portfolio is 14.25%.

Could it be that the number of winners in a row isn’t the number we should be concerned about. I’d rather know how much money my money made for me.

[mrmarket]

Well it sounds pretty impressive but I’ve been tracking you since last Nov and in that time frame you have had 12 winners. Based on an equal position size with enough spare cash in the account to hold 14 positions the realized gain is 13.32%; pretty damn good; sure beats a savings account.

But that Old Lazy Dog, He started a portfolio with only 8 stock around the same time. Out of 7 pick he only had 5 winners. But you know the realized gain on the portfolio is 14.25%.

Could it be that the number of winners in a row isn’t the number we should be concerned about. I’d rather know how much money my money made for me.

Sounds like we should have deaddogishuge.com

[mrmarket]

Well it sounds pretty impressive but I’ve been tracking you since last Nov and in that time frame you have had 12 winners. Based on an equal position size with enough spare cash in the account to hold 14 positions the realized gain is 13.32%; pretty damn good; sure beats a savings account.

But that Old Lazy Dog, He started a portfolio with only 8 stock around the same time. Out of 7 pick he only had 5 winners. But you know the realized gain on the portfolio is 14.25%.

Could it be that the number of winners in a row isn’t the number we should be concerned about. I’d rather know how much money my money made for me.

....the magic of compounding maybe escaped your arithmetic?

[Deaddog]

Sounds like we should have deaddogishuge.com

No that requires a skill set I don't have.
I'm still trying to get this stock picking thing down.

When I get to the stage that I can pick more that 4 or 5 winners I'll ask for some help with the Blog. Right now I'm just happy to be pointed in the right direction as far as stock picking goes.

....the magic of compounding maybe escaped your arithmetic?

And yes I understand compounding. The only reason my 8 stocks outperform your 14 is that I'm always fully invested. To have something to compare with I have to keep your position size to 1/14th. I know you do better but I have to have some kind of bench mark.

Interesting subject though. I am wondering what the best way to put compounding to work for me.. I'm considering increasing position size (total $ per position) by 20% every time I have a realized gain of 20%.

So if my 8 stock portfolio is worth $80000 and my position size today is $10000 per stock; as soon as I have realized a profit of $16000 (20% of 80k) I will increase my position size to $12000. The question is should I just make new positions the increased size or should I top up all my positions at the same time. I trade with IB so brokerage cost won't be a big influence.

[billyjoe]

Deaddog,
Compounding is also helped by reinvesting dividends. I'm up on PM, NJR, HQL, NYB, IDE. And the divs. just make it an added bonus.


---------------billy

[peanuts]

All your picks are HUGE. I've enjoyed wild success with many of your choices. It's like having Babe Ruth in my lineup.

[Deaddog]

Deaddog,
Compounding is also helped by reinvesting dividends. I'm up on PM, NJR, HQL, NYB, IDE. And the divs. just make it an added bonus.


---------------billy

Billy:
I take it these are long term holdings. Do you have a DRIP set up with your broker or do you just buy an extra share or 2 when dividends are issued?

For the type of stocks I am picking (Growth & Momo) for the Lazy Dog Portfolio, I’m hoping I don’t hold them long enough to collect a dividend.

The other thing that affects my compounding is that I use my trading profits to finance for my lifestyle. I have been operating with a fixed position and portfolio size, taking my profits out of the portfolio at the end of each month. This tends to make me cut my losses a bit quicker and not let a non performer sit in the portfolio for any length of time.

I’m taking a long hard look at compounding and will attempt to come up with a strategy that allows for both taking a little spending money and adding to the portfolio.

[mrmarket]

No that requires a skill set I don't have.
I'm still trying to get this stock picking thing down.

When I get to the stage that I can pick more that 4 or 5 winners I'll ask for some help with the Blog. Right now I'm just happy to be pointed in the right direction as far as stock picking goes.

And yes I understand compounding. The only reason my 8 stocks outperform your 14 is that I'm always fully invested. To have something to compare with I have to keep your position size to 1/14th. I know you do better but I have to have some kind of bench mark.

Interesting subject though. I am wondering what the best way to put compounding to work for me.. I'm considering increasing position size (total $ per position) by 20% every time I have a realized gain of 20%.

So if my 8 stock portfolio is worth $80000 and my position size today is $10000 per stock; as soon as I have realized a profit of $16000 (20% of 80k) I will increase my position size to $12000. The question is should I just make new positions the increased size or should I top up all my positions at the same time. I trade with IB so brokerage cost won't be a big influence.

Now you're getting it...reinvesting profits is the way to make your nest egg grow and grow. Take a 15% gain and reinvest it 8 times and see what you get.

[mrmarket]

Billy:
I take it these are long term holdings. Do you have a DRIP set up with your broker or do you just buy an extra share or 2 when dividends are issued?

For the type of stocks I am picking (Growth & Momo) for the Lazy Dog Portfolio, I’m hoping I don’t hold them long enough to collect a dividend.

The other thing that affects my compounding is that I use my trading profits to finance for my lifestyle. I have been operating with a fixed position and portfolio size, taking my profits out of the portfolio at the end of each month. This tends to make me cut my losses a bit quicker and not let a non performer sit in the portfolio for any length of time.

I’m taking a long hard look at compounding and will attempt to come up with a strategy that allows for both taking a little spending money and adding to the portfolio.

I'm not a financial manager but Austin Dutton is. However, conventional wisdom dictates that one ought not to put money in equities that they will need in less than 5 years.

[billyjoe]

Billy:
I take it these are long term holdings. Do you have a DRIP set up with your broker or do you just buy an extra share or 2 when dividends are issued?

For the type of stocks I am picking (Growth & Momo) for the Lazy Dog Portfolio, I’m hoping I don’t hold them long enough to collect a dividend.

The other thing that affects my compounding is that I use my trading profits to finance for my lifestyle. I have been operating with a fixed position and portfolio size, taking my profits out of the portfolio at the end of each month. This tends to make me cut my losses a bit quicker and not let a non performer sit in the portfolio for any length of time.

I’m taking a long hard look at compounding and will attempt to come up with a strategy that allows for both taking a little spending money and adding to the portfolio.

Deaddog,

I guess I do have a DRIP set up. Haven't heard that word for a long time. It's more than a share or 2 having been doing this for more than 25 years the accumulation becomes Huge. I've not taken out a dime in all that time.Also most of the big div. payers aren't very volatile and not as risky as the speculative picks. Maybe a little boring but I can live with 10%+ compounded each year. These are long term. My play money buys the others.

---------------billy

[Deaddog]

I'm not a financial manager but Austin Dutton is. However, conventional wisdom dictates that one ought not to put money in equities that they will need in less than 5 years.

Conventional Consmentional: Mr. Market isn’t conventional is he now?

Here’s where I disagree with conventional wisdom. If equities have the best return why wouldn’t you want your money there? I know; I know the market could crash. What law says you have to leave you money in the market when it goes down?

A good portion of my income is derived from my investments. With fixed income being so low and inflation looming I can’t afford to not be in equities.

It may be a little riskier so I control my risk by cutting my losers. The only way the market can take money from me is if I let it. It’s a more hands on approach than most people are comfortable with but who is the best person to manage my money: Me.

This way I can only blame one person if I screw up.