Lost 100K in one month, 50% wiped out, start to write journal

[NoDoji]

Quote from lost100k:

I was doing average down many times, and never has problem until this time.

"Averaging down works really well until it doesn't. Then it REALLY doesn't."

Here is a scenario where averaging down is acceptable because you are planning your max risk in advance (though it's still not wise):

A stock sets up for a long or short, but it's not the highest probability setup (there another support or resistance level that may still be tested). But you are antsy to get into the trade because you might miss the move if you don't.

OK, if you're that impatient and afraid of missing the move, put on half your full position and place your stop just outside that next S/R level. IF it then moves against you and comes close to that next S/R level and you still feel the trade has merit, put on the rest of the position and keep your stop in place for the full position. Once S/R is broken all bets are off; honor your stop and re-evaluate the trade.

This method prevents you from taking a larger loss, and if the trade had gone in your favor right away, you would add the rest of your position to a winner.

 

[ivanbaj]

Quote from kxvid:

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+10

 

[GTS]

Quote from lost100k:

AIG really confuse me. The reason I bought is they have book value over $300 and now trade at $13. I think they still have 30 B on balance sheet and assets at 600B. It is true that they may loss over 30B in a sudden on that 600B (just need to loss 5% of its asset) and make the stock worthless, but they are also actively selling their assets to make the leverage down.

Another confuse is the government bailout. I think government give 100B loan to them? which should on the liability on the balance sheet. News said government has 80% stake on the company? I think they still did not
exchange loan to common stock. If they exchange, total shareholder equity become 130B and current holder has 20B in control and the book value is still over $200.

Not sure if I am right on AIG. But my thinking is the reward looks greater than the risk.

Ok, nice troll up until this part. Surely you can't be serious about AIG?

 

[auspiv]

Quote from TraderZones:

I have a feeling this may be Mr. 40 Aliases (Cold/c-kid, Jasonn...). He has a history of shock titles and this looks his M.O.

the writing style isn't the same at all

 

[BartS]

AIG long based on fundamentals after a reverse split.
This is possibly one of the worst trades I have ever seen.

If not for the governement this place would be dead.

This was a decent long back in march for a dead cat bounce off the lows - and that's it.

Honestly, I'd stop trading right now and go after a few stocks that you'd learn real real good.

You seem to be all over the place and a little lost (I'd be too if I was in your shoes)....You trade stocks you may not know enough about to make good decisions...

Pick yourself a good book.

Here's 2 for you:
The disciplined trader - Mark Douglas.
Mastering the trade - John carter.

I know a lot of guys have egos and will try to tell the market that it's wrong but that simply doesn't work - when you're wrong accept that quickly and get out - preserve capital at all cost and remember that there is always another trade.

Good luck.

 

[TraderZones]

Quote from auspiv:

the writing style isn't the same at all

Just watch. I suspect it is 70:30 odds he is.

 

[guy990opl]

Where you trading or gambling ?

Quote from lost100k:

One mistake can ruin all the life.

Average down, it is the cause make me loss 30K on MRNA. I was doing average down many times, and never has problem until this time. I have 200K in assets and 10K to buy MRNA at start. When MRNA goes down, I add more to 60K. Unfortunately, MRNA did not go back this time. I finally stopped out with 30K loss.

 

[nebulous]

IMO I'd agree with the suggestions to take a break and revisit the strats. Revise your risk management - maybe something like no more than 10% loss in a position, no position stops bigger than 2% of the portfolio cap (factoring slippage into all stops). You need realistic targets too.

I'd also strongly recommend moving away from the penny stocks. Remember how quickly penny stocks move on a % basis when falling and that massively diluted stocks (or any penny stocks with giant floats) have a lot of natual resistance to upward movement and tend to be trading in pennies for a reason. They also tend to amplify the greed factor. If you feel you have to keep them, think of sizing your positions in a risk based manner off your stops, not absolute capital allocations.

 

[lost100k]

AIG really has problems, but at this price, I think it is a good buy. I do not expect it goes to 100, but I think I will sell them at 30-40 range.

Yes, buy AIG is based on book value. Those fundamentals are on the desk, unless it bankrupt, goes to 0.

If I have a loss on AIG, I will accept it. As a whole part , it is 10% of the portfolio. I won't buy more than 10%.

If you see my long portfolios, you can see that all of them are banks which is heavily down in a month. I cannot say anything on this choice, just unknown how risky this long portfolio is since it is all in one sector. Anyone think bank sector will go down heavily further? I think the crisis is over based on Q2's earning report although there is a long way to get out the mud. The bank shares looks cheap at this price.

I agree with you on this:
I know a lot of guys have egos and will try to tell the market that it's wrong but that simply doesn't work

thanks for your post

Quote from BartS:

AIG long based on fundamentals after a reverse split.
This is possibly one of the worst trades I have ever seen.

If not for the governement this place would be dead.

This was a decent long back in march for a dead cat bounce off the lows - and that's it.

Honestly, I'd stop trading right now and go after a few stocks that you'd learn real real good.

You seem to be all over the place and a little lost (I'd be too if I was in your shoes)....You trade stocks you may not know enough about to make good decisions...

Pick yourself a good book.

Here's 2 for you:
The disciplined trader - Mark Douglas.
Mastering the trade - John carter.

I know a lot of guys have egos and will try to tell the market that it's wrong but that simply doesn't work - when you're wrong accept that quickly and get out - preserve capital at all cost and remember that there is always another trade.

Good luck.

 

[Tide31]

AIG - no way to value that I know of: Gov owns 80% and is owed $180 Bil. 1:20 reverse so that Goldman could short against margin deficiency was the joke this week.

You have all wildly spec stocks on. It looks like a customer of Datek's portfolio from 1990. Like your searcing for the next GOOG that you bought at .65 cents.

Rule 1 - never buy a stock under $1 (they are trading there for a reason).

Rule 2 - Never short a stock under $5; risk-reward is skewed usually.

Majority of your stocks violate these age old rules. I would liquidate and reevalute. You are not going to be up 100% to get your money back. With some savvy option plays (since you are comfortable with risk) and a balanced book you may get $20k back by year end. I would say the time for a major change is 9.30am tomorrow and not a minute later. This is without knowing anything about the actual names in your book except for 2 of them.


Good Luck!