Discussion in 'Stock picks and trading strategies' started by txjeff, Feb 28, 2012.
This thread will break down the plans for long or longer term investing. :turtle:
Here's the four types of funds I would suggest for investing. These would be listed in say a spreadsheet and the stocks or options would be graded with a 1 for best;keeper through 5 (5 would be first one to go in bearish times). Although the list may have 50 or more investments, your personal portfolio would be tailored to suit your budget. Percentages of "sectors" for the diversification of the fund will be dependent of the type of fund. Hedging should be an integral part of each fund as protection.
Objectives: To provide stability and generate above average 3 to 5 year capital appreciation.
Strategies: Invest in mid to large capital good quality common stocks with no or low dividend yield.
Objectives: To provide capital appreciation and tolerate greater short term volatility than other funds.
Strategies: Invest in stocks with above average growth rates with reasonable price and P/E ratio and PEG ratio.
Objectives: To generate income and provide stability to the fund.
Strategies: Invest in securities with a 1 to 3% dividend yield.
Small Capital Fund
Objectives: To provide diversification to the overall portfolio through higher risk positions in emerging markets and small businesses.
Strategies: Invest in stocks with a market capitalization of less than $1 billion with no or low dividend yields.
Here is my carefully crafted plan for long term investing. Not sure what type of category you would give it.
Currently I am holding ( longer than a year, with the exception of ECT ) - I typically buy these on dips, sell some when they get top heavy.
HPI, CII, BQR, CTL, PPL, HGT, ECT, NLY
I buy HPI under 18.
Buy CTL under 35
Buy PPL under 28
Buy NLY under 17.
Just added ECT, see the NATGAS thread.
I sort of have my swing trading built into this, where as most of this does not grow quickly, or lose that quickly, there are subtle swings if you go out 5 years or so. Profits from the swing trading either go into these, sit in cash, or I make another trade. Monitoring the ex dates is critical as well for the ones that do not pay out monthly. This yields over 5%.
About half , give or take 25% , of my swing trades are things that wouldnt be so bad in a longer portfolio. ( Hard to say, depends on the charts. Some are downright dogs )
My questions are -
What exactly do you want to fit into a long portfolio ?
How would categorize what Ive got here? ( Can say its a POS if you want , i have think skin )
I might add some CTL, then sell it 2 weeks later ( but not the whole position )
Not much difference in this and what i swing except on the swings, i have a stop loss and a definite time frame.
I also own this:
Er, some unit trust crap from Invesco. That one was last years I think. Did awesome , I was pleased. Its my large Cap exposure. You get the idea
And now a glorious example of my divine plan in action. ( Dividend Capture )
PPL goes ex this week, I may buy 50-100 shares. hopefully at or under 28, Monday or Tuesday.
I will then , hopefully, sell this turd for some amount higher than 28.5-29, and get the dividend, on some date with in the next 2-3 weeks after Thursday.
So if I do 100 shares, I get the 36 bucks, and hopefully another buck a share.
low stress/risk this way, but also low profit. When I cannot have my eyes on the market all day, this is what i engage in. ( If I am able to day trade, I typically do not engage in this )
the disclaimer is I can change my mind about this and do something else, should i find something juicier that is more of a "swing trade" persay and I do this in a Roth to not pay taxes.
I see you have somewhat of an effort at diversification, although it's a bit heavy on financials and light on pharma. But you aren't laying a ton of money out there, so you are probably ok. Sounds like you don't have any hedging in place. Anyway, choosing stocks for the funds is part of the process. Swing trading is mostly a speculative trade; investing is typically far longer if you are interested in dividends. If I wanted to hold a stock for a long time for dividends I would probably employ covered calls as protection.
First to clarify... The below investments are in a SEP IRA account... Which is less than 20% of my entire portfolio... I also have a (401K) that is very limited in my investment choices. Which is why I am more aggressive with the SEP IRA..
The Stocks that I have owned for awhile now: AAPL and TSCO... both have done very well for me...
Another stock that I own off and on is BAC.... Due to its recent up and downs... It cant stay above $8.10 for any period of time... So I have been selling it at above that area... literally last friday... Sold at $8.12
I literally just bought back in today at $7.965... I catch 2-3 percent ...
I am trying to find a place for WPRT in this portfolio... I like this stock...
I honestly think it will be trading at $10-12 by the end of the year...
Like Useless,,, I have been know to buy stocks just for the dividend payout... BDX is a good one... It typically bounces pretty good before divident pay out... last time I caught 10% on investment and the dividend.
Since Jan 1 2012... I have also owned BDX, ETN, GLD,
Basically my strategy for this account... Hold AAPL and TSCO which is about 66% of the account... until I see evidence it will drop or it triggers my stop loss... which is typically 3% lower...
The other 33% is used for shorter term trading and quicker/smaller returns...
Please note... If I see anything major in the market that scares me... I will sell everything... wait until I see a reason to come back in...
No, I dont have an effort in diversification. ( i have other things, like that invesco bullcrap that is diversified ) That is partly the point. I wont have a Pharma in there unless one one is yielding over 5% and i want to dump something else.
You need just a little bit as whole sectors tend to move. ( ie , more than 1 )
You can hedge w/ options in a dividend capture strategy as well
Not sure if this is the correct place to post this...
I have another 2.5 % gain in BAC right now... I am asking for advice/opinions. Should I sell and take the profit... or hold...
I think it will continue this roller coaster ride for another month or so...
Your request as to whether to hold BAC is posted in the Investment Plan sub-forum for the TIC, but really this is not the place for personal trade requests. That would be the main Stock trading sub-forum. Since you are simply trading that stock, I don't consider it investing anyway. It's either a day trade or a swing trade. If you want to make it a long term investment, then just buy some shares and leave it alone for a long time if you expect it to go up over time or if you expect to collect dividends from it. It's really as simple as that.
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