My Picks in 2006

Profit/Loss

RMD - 10% Gain
CHCI - 35% Gain
HAL - 11% Gain
HANS – 33% Gain
AMGN – 9% Gain
WTR – 11% Gain
CME – 0% Push
DXD – 16% Loss
NTDOY- 21% Gain
LZB – 12% Gain
NFLX – 12% Gain
SIRI – 12% Loss
STP – 13% Gain
GLW – 11% Loss


Average Profit/Loss: 9%
Average Loser: 13%
Average Gainer: 17%
Amount Correct: 71%

So, how am I supposed to calculate if I hit my goal of a 30% gain for the year? Well, I need to figure out the average turnover for each stock and multiply that by the average P/L for each stock, and I get a good estimation of what my picks brought in.

I don’t need to make the assumption of how many stocks were in my portfolio at any given time to account for the amount of money used, because there is always 100% investment at all times. I realize that this is not always true, but I need to simplify for obvious reasons.

(901 Cumulative Days Held) / (14 Stocks) = 64.36 Days Held on Average
(64.36 Average Days Held) / (155 Total Days Traded --I started late in July) = 2.4 Turnover Rate
(2.4 Turnover)*(9% Average Profit) = 21.6% Total Profit

Gain since July 28th (The start of this blog)
DJIA = 12%
S&P500 = 12%
My Picks = 21.6%

(155 Total Days Traded) / (360 Days per Year) = 2.32 Annualizing Factor
(2.32 Annualizing Factor) * (21.6% Total Profit) = 50.1% Annualized Gain

I wouldn’t have liked to sell GLW so soon, but I think it’s the only fair way to end the year. I will probably re-add it for a fresh start in 07’. There were a few areas where I could have improved, but overall I think I did well.

In my next post I will start my portfolio for 2007.
Happy New Year.
-Chris

One More Day

The trading year ends tomorrow and I'm left with STP, SIRI, and the recently added GLW to my picks. STP is sitting on a 15% gain, SIRI a 12% loss, and GLW a quick 11% loss. I will close all three positions out tomorrow and start fresh in 2007.

In my next post I will review my trades for 2006.
-Chris

Two Thumbs Down

Let go of Netflix shorts when markets re-open on Tuesday, 26th.

With four more days of trading until the new year, I'm rolling up my positions. I will re-evaluate my two stocks left and look for more, as I battle the idea that the market could finish at an all time high.

If you shorted Netflix when I suggested at 29.50 you would have a 12% gain. The stock is currently at 26.20 and sitting just above 200DMA support and 50WMA support.

I still think this is a stock to short, based on two simple facts:
1. Competitors are emerging from everywhere
2. Downloading is the future of rentals, not mailing

I would rather not lose money we've already made if NFLX gets a pop based on technicals. Bank the money and lets look forward to a great 2007.

Merry Christmas
-Chris

Ho Ho Hold on...

Every now and again charts just don't work-- if they did, everybody would use them. Even after Corning re-affirmed fourth-quarter guidance, it broke through support and decided it wanted to hang around in the 19's. Normally I drop a stock that breaks a strong support, but GLW does not have enough flaws to make me drop it.

Assume the analyst at UBS is right and there will be a weaker demand for LCD monitors and big screens. Wall street will not care when they release Q4 numbers in January, and see potential growth. Charts still look pretty on the MACD side, so I will give GLW a month to cooperate. RSI is getting low, Slow STO is below 20, I don't see more short term free fall to come.

As a side note, STP could be looking to start a Cup-and-Handle. Lets cross our fingers and hope that Christmas comes on time.

Good luck to all of you and be careful, the DJIA charts still look UGLY.
-Chris

*edit* I caught this article after hours today on NFLX, which is the reason they took a 2.5% drop when the market closed.

Christmas Loves LCD's

Buy Corning Incorporated (GLW). Not only does this holiday season look good for Liquid Crystal Displays, it also looks promising for a shortage in fiber-optics. Of course anybody who knows GLW could tell you that, but I have other reasons for suggesting the stock-- always technical.

Here on the daily chart one might suggest that GLW is below both 200 and 50 day resistances (mainly right below the 50). Although it could be a resistance for the stock, the plus side is that a stock close to a support/resistance invokes volatility. Add volatility to a stock that's crossing the zero line on its MACD, and you have a good possibility of a breakout upwards. I don't like the high SlowSTO, but perfect charts are hard to come by. Also, as annotated on the chart, there is a good support not too far away if the 50DMA buffers the stock.

Similar story on the weekly chart, a 50WMA resistance approaching while the MACD is ready to cross the zero line.

The risk/reward is excellent here, and I will be adding GLW to my personal portfolio tomorrow.

I hope you're all enjoying the holiday,
-Chris

Lazy Stocks Part II

Take profits on La-Z-Boy (LZB) and sit tight as I scour the market for another stock. I hate to leave only 3 stocks in the portfolio, but I'm pretty sure we can get back into LZB at a higher price. If you shorted La-Z-Boy when I suggested at 13.29 you would have a 12% gain. The stock is currently at 11.85 and nearing some moderate support from it's uncorrelated MACD. I've been a bit busy lately, but I expect to find a gem to add to the list soon.

Have a great weekend.
-Chris