My greatest investment mistakes of 2016
I did two and one half stupid things last year.
1/ TWR
Bought in March on what I thought was a market over-reacting and then holding on long after I should have realised that in this case I really did not know better than the market before finally selling out in September.
Fortunately I did stick to my rule about only adding to winners and only ever bought a minimum ($20K) holding but quit with a 42% loss. This is percentage wise and $ wise one of my worst ever losses.
2/ IQE
Bought a half minimum (:confused:) holding in November 2015 and was in profit in late January 2016 when I doubled up. Then it tanked again and I should have followed my rules and sold then.
But I watched it go as low as $0.24 and rise up again to nearly $0.50 justifying my decision. End of March and it fell to $0.40 and in early April I was out with a 27% loss.
the half/ HBL
I sold down part of my HBL hollding, realising a great capital profit, mainly because I was well overweight HBL at the time.
As the year progressed and the various other portfolio members gained that overweightness would have sorted itself out. Indeed come the end of June I bought more HBL, but for a lower price than the earlier sell and the missed divvy, without achieving obesity.
Conclusions and lessons/
a/ The one I really regret is selling those HBL. I did not need to sell and the fact that I used some of that money to buy more IQE hurts a little.
b/ I do not condone buying into a downtrend outright, and over the years have done well picking the nearly right spot, but the moment it was obvious that the market was not going my way I should have admitted the mistake and moved on.
Otherwise I had a pretty good year.
Best Wishes
Paper Tiger