This week has been hard. 6 straight down days for the DOW, which has a big influence on the movement of our market, made me lose most of my profits of about (50k PHP) in 5 months. I guess in an overextended rally like this, it should have been obvious to sell in may and stay in the sidelines for some re-planning. A big factor with my lost is that my capital is a bit bigger compared to what I had when I earned my initial profits. I started with 200k, and it was typically easy because there where lots of bullish rallies to go with. I added 400k to my portfolio making it at about 644k. I entered the following stocks:
MARC @ 3.03 (SOLD) – This gave me an easy 20% gain, which boosted my port a lot, the prob was my bullishness about the stock made me think of holding this one forever. Although it has lots of potential, nickel prices have been going down for quite some time. This gave some investors reason to sell. MARC was also sold down with the other favorites (NI, DIZ, ORE). So instead of getting about 20%, I just sold this at about 3.40 or 3.60. This is still a good stock, this will be in my watch list, I’m hoping to enter it again.
MPI @ 4.08 (HOLDING) – For me this company has really solid fundamentals. It engages in businesses that will gain profit no matter what the foreign economic climate is. It has a stake in Maynilad, it engages in infrastructure developments and other projects such as toll ways, LRT/MRT, furthermore the company is slowly buying big hospitals that have schools as well, such as Makati Med. Potential MSCI listing this may 15, I believe that no matter the developments abroad, one should be secured about MPI.
AGI @ 12.49 (Mistake) – Caused me one big mistake here (worth 14k). I was watching TV (lol) I was supposed to press buy for 1k shares at 12.60, but instead of buying 1k, I accidentally added another ZERO zzzzzzzzz, which made it 10k shares!!! It was supposed to be a test buy since I was still monitoring AGI’s down turn during that time. Soon, from my entry price of 12.60 it went down to as low as 12.20. When it went to ab out 12.16, I added another 50k on the thoughts of averaging down and feeling that it was already a good opportunity. A week after that, the foreign climate was a bit panicky.. or was it just me? (I wasn’t really that focused during this period because I was enjoying vacation.) It went to as low as 11.70! I immediately panicked errr.. My 180k worth position here gave me a loss of about 15k, so feeling really uncertain about the position, I decided to take a loss and just learn from it. The bad part was when I sold at 11.70-11.80, it was the bottom of the short-term down trend already! Big mistake there. I ended up entering at 12.20’ish again with a smaller position, although I should’ve just averaged down during the 11.70 dip, I wasn’t really sure because all the noise was a bit panicky. I guess I still lack the emotional control of holding big positions such as this.
I sold my stake at 12.90, AGI went to a 52-week high at 13.70. The next day, it went down from an open of 13.60 to 12.80-12.90. I would’ve sold immediately at the gap down, the problem was I was still sleeping during the open.
- Emotional Control – do not immediately panic on major sell offs assess the situation first and your options. Sometimes the biggest opportunities are found in the most dire situations.
- Act on a mistake immediately – I accidentally pressed 10k shares instead of a mere 1k. I should’ve sold immediately if I wanted to limit my position size, instead of averaging down at an uncertain point.
- Conviction – If I didn’t panic due to my big position (180k on a stock was the biggest position in my life, I’m just a newbie :p :), I would’ve been able to save myself from taking a loss.
These are just some of my losses and mistakes over the past week. I’m planning to liquidate most of my positions and try to re-plan and let the storm set in first (if there is one), before I look at entering new positions. My profits were easily chipped off because my port size is bigger now compared to the time where I started to get my 50k up. A 1% loss in my port would give me a 6k loss haha, at the same time, a 10% gain would give me a 60k profit. I think it’s just a matter of timing, strategy, and execution. I’ll stay on the sidelines first and get back these losses soon!