sharetrader
Page 1 of 2 12 LastLast
Results 1 to 10 of 18
  1. #1
    Reincarnated Panthera Snow Leopard's Avatar
    Join Date
    Jul 2004
    Location
    Private Universe
    Posts
    5,853

    Thumbs down 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 () 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
    Last edited by Snow Leopard; 31-01-2017 at 03:06 PM. Reason: Only just spotted the title typo
    om mani peme hum

  2. #2
    Member
    Join Date
    Jul 2013
    Posts
    89

    Default

    Thanks for the post Paper Tiger, can you perhaps elaborate on the rule you broke when you didn't sell IQE? I also dropped the ball on that stock, must have bought around the same time as you. Risky sector but thought it genuinely had promise. Then some unpredictable bad news (and again, and again) and I held on far too long. No single bit of bad news was enough to make me get out and took me too long to piece the story together, in hindsight was inadequate judgement of the increasing levels of risk on an already risky stock :\

  3. #3
    Reincarnated Panthera Snow Leopard's Avatar
    Join Date
    Jul 2004
    Location
    Private Universe
    Posts
    5,853

    Default

    Hi Meister

    Rule: If you are down by 20% or more on your purchase price you better have a very good reason to still be holding. For me and IQE that was a share price of $0.424 or less.

    IQE closed at $0.365 on 29-Jan-2016 because of another bad news announcement and I had an unrealised loss of greater than 20% and I did not have any good reasons to hold.

    Really I should have sold on 1-Feb but looking at the chart I could make the case for not selling until 4-Feb.

    I stuck to the rule after the price fell to $0.41 on 30-Mar-2016 and finally sold out on 5-Apr. Ideally I should have sold out on 1-Apr.


    Luckily IQE now falls under the Do not buy anything with a 64 day average daily turnover of less $80,000 rule (being at $10,582).

    Best Wishes
    Paper Tiger
    om mani peme hum

  4. #4
    On the doghouse
    Join Date
    Jun 2004
    Location
    , , New Zealand.
    Posts
    9,221

    Default

    Quote Originally Posted by Paper Tiger View Post

    the half/ HBL

    I sold down part of my HBL holding, 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.
    Surely a case of the Tiger beating himself up unnecessarily?

    1/ It is only possible to make investment decisions 'at the time'. You cannot make them in the past of the future.

    2/ You can't possibly know that the rest of the portfolio would have sorted itself out before it happened.

    SNOOPY
    Last edited by Snoopy; 20-01-2017 at 06:50 PM.
    Watch out for the most persistent and dangerous version of Covid-19: B.S.24/7

  5. #5
    Reincarnated Panthera Snow Leopard's Avatar
    Join Date
    Jul 2004
    Location
    Private Universe
    Posts
    5,853

    Thumbs down AA - Actives Anonymous

    Quote Originally Posted by Paper Tiger View Post
    ...
    a/ The one I really regret is selling those HBL. I did not need to sell
    ...
    So let me expand on that underlined word need:
    What I needed to do was absolutely nothing;
    As rule I do not sell down just to balance a portfolio, winners are kept;
    HBL was, and still is, a good share to own;
    I did not, at the time have any other share in mind to purchase;
    I sold purely for the sake of doing something, when the only sensible thing to do was to sit on my paws.

    This is a flaw which I have previously been guilty of and a review of 2016 showed I have not kicked the habit.

    Best Wishes
    Paper Tiger
    om mani peme hum

  6. #6
    Member
    Join Date
    Aug 2015
    Posts
    284

    Default

    My habit also...I managed to sell THL and buy into IFT at the top of its cycle! I know that I shouldn't have done that but I thought I was smart so displayed my idiocy. Now I am moving my NZ profits into a managed fund and have allocated myself a play portfolio of real money in the UK (because more happens there) and that is keeping me very happy.

  7. #7
    percy
    Join Date
    Oct 2009
    Location
    christchurch
    Posts
    17,221

    Default

    BeeBop.
    Would you mind starting a new thread and sharing your thoughts on UK stocks.
    I did follow some stocks there over 25 years ago.!
    Recently I tried researching some UK small cap stocks,but found nothing I wanted to buy.

  8. #8
    On the doghouse
    Join Date
    Jun 2004
    Location
    , , New Zealand.
    Posts
    9,221

    Default

    Quote Originally Posted by Paper Tiger View Post
    So let me expand on that underlined word need:
    What I needed to do was absolutely nothing;
    As rule I do not sell down just to balance a portfolio, winners are kept;
    Personally I see nothing wrong with selling off some of a position to balance a portfolio. In fact I regard it as prudent to do so. However, whether you agree with that appoarch or not, I also do not enjoy turning over a portfolio unnecessarily. My rather loose system is that I have a maximum dollar amount that I will keep invested in any NZX share. However, if I go over that maximum I would not do anything sudden until I reach a tolerance over my target. This tolerance is 100%. IOW I will sell off any share that reaches twice my value target. Now you may say this is foolish. If the share is continuing to go up just ride the wave. For me this appraoch is too risky. Given that I am already 100% above my investment target amount, I find great relief in selling down and very importantly lowering my average buy in price at the same time.

    Needless to say I don't need to trade very often

    SNOOPY
    Last edited by Snoopy; 22-01-2017 at 10:24 AM.
    Watch out for the most persistent and dangerous version of Covid-19: B.S.24/7

  9. #9
    Member
    Join Date
    Aug 2015
    Posts
    284

    Default

    Quote Originally Posted by percy View Post
    BeeBop.
    Would you mind starting a new thread and sharing your thoughts on UK stocks.
    I did follow some stocks there over 25 years ago.!
    Recently I tried researching some UK small cap stocks,but found nothing I wanted to buy.
    Percy, I shall do...probably I will merely lay out what I do/hold and why (my metrics). I am not a regular analyst....first call is for you to listen to the Investor Chronicle weekly podcasts (I get them via iTunes), the companies and markets show is one of my favourites.

  10. #10
    percy
    Join Date
    Oct 2009
    Location
    christchurch
    Posts
    17,221

    Default

    Quote Originally Posted by BeeBop View Post
    Percy, I shall do...probably I will merely lay out what I do/hold and why (my metrics). I am not a regular analyst....first call is for you to listen to the Investor Chronicle weekly podcasts (I get them via iTunes), the companies and markets show is one of my favourites.
    Thank you I look forward to your post.

Tags for this Thread

Bookmarks

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •