G. Stocks

The goal of this blog is to act more as a stock research reference web site. I've always had an interest in the stock market and have purchased many different stocks over the years. Now I'd like to take it to the next level.

Sunday, September 02, 2007

09/02/07 Stock Portfolio

Here's a summary of my current stock portfolio. Some stocks such as BUD, INTC, and MMM I've been carrying around for a quite a while now which is why the appreciations are so high (my dad got me into investing back when I was in high school). IBM is a stock I've purchased through my employee purchase program so have been slowly adding to it since 2001. I got a bit "lucky" on that one in that it tanked when I first started and has been coming up ever since (all me of course :)

STOCK % Gain/Loss % Portfolio
IBM 141.98% 14.39%
GRMN 101.32% 14.25%
BUD 203.19% 12.91%
QSII -4.06% 9.98%
JNJ 10.98% 8.39%
MMM 300.49% 8.34%
MLAB 6.83% 6.91%
LH 2.70% 6.47%
SJT 2.17% 6.32%
DEO 82.74% 4.50%
INTC 114.45% 4.47%
MRK -1.11% 2.06%
GTW -4.17% 0.99%

Stock Strategy

I've discussed a lot of the things I look for when purchasing a company, but I've never really discussed my decision making process when purchasing and selling a stock. Mostly this is because I tend to make it up as I go along :)

I've been trying to develop a strategy that allows room for a stock to appreciate without interruption from me, but at the same time which allows me to avoid the "bubble" affect and take some gains when a stock reaches a peak and begins to come down.

I strictly follow the -10% rule. That is, if a stock depreciates 10% from my initial purchase price, I immediately sell it all. I recently posted a question to Bob on bobsadviceforstocks.com. Bob is one of my favorite stock bloggers and follows a very strict buy and sell system. My question to Bob can be found here. The main thing I take from this is that Bob has a system, and he sticks to it. There's no gut feeling, no emotion, nothing that is used except his system. It makes investing for him simple (other then picking the right stock of course :). I still see myself as a bit young and foolish, so I just can't bring myself to follow this type of strict strategy (although I know deep down it's the best thing), but I do at least need some rules!

G. Stock Investment Strategy

  • Always sell a stock if it depreciates by 10% or more.
  • Never buy a stock at a peak, I feel like it raises to much risk that I'll end up hitting my -10% sell point if I do.
  • Try and always buy into a stock in a valley (may seem obvious by previous one but not necessarily)
  • Once a stock appreciates by 100%,200%,300%..., sell half of holdings if it depreciates to 85%, 185%, 285%...
  • Sell all of a stock if it appreciates to 100%,200%,300%..., and then proceeds to drop to 50%, 100%, 150%...
  • Never buy stock from a company which is not making money (see exception next)
  • Carry one speculative stock (bio-tech, green energy, ... ). This is the "lottery" ticket as Bob Kramer likes to call it and I believe every good portfolio should have one. This should not exceed more then 1/10 of the portfolio though.
  • Be Patient! Unless a stock seems stagnant, or is no longer a good selection based on homework, be willing to sit on a good stock and wait for it to appreciate.