Green day on low volume. It doesn't necessarily mean that bulls' story is over and it was a dead cat bounce. We saw several times already in todays' market that bulls recover from a very difficult position and move up further.
Penny stocks were not bad today as well. Because of SDS we did worse than S&P and this is the price we pay for hedging. I noticed that we were selling more our long positions than replenishing and relative weight of SDS grew from 27% up to almost 30%. It's not good and I think during the next down move we reduce our SDS hedging by 1/3. At this point makes sense to reduce both: SDS and number of long penny plays. I started cleaning portfolio couple of weeks ago but was doing it too slowly IMHO.
Today was a good day to reduce number of positions and I used this opportunity to sell one of our oldest plays – CMLS. Bought for 0.55, today we sold it for 2.17. Perfect 300% result. Its regretful we saw CMLS reached 2.50 today, so we could book almost 400%, but,.. well… it's a done deal. We sold CMLS as I don't see TRUE long term potential for this company. Huge debt, negative book/share value for CMLS is still there. When I bought it for 0.55 and when I sold it today for 2.17 – it's the same company with the same problems.
SBSA – a play we added 6 days ago for 48 cents. Sold ½ of SBSA today for 0.54. Top price for SBSA today was 0.59. I noticed for the last two weeks I sell a little bit prematurely, but I don't think it's a big problem here. After such a huge 50%+ market rally, it makes sense to stay risk averse and realize "modest" 10-15% today instead of waiting for 30-50% tomorrow, which looks too nice to be true.
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