Thursday, October 18, 2007

Portfolio review continued.

Well, I managed to only purchase one new stock today, and sold off 3 (VM, LTUS, and GHDX). Didn't make my goal of just selling, but at least the net of the transactions was in the correct direction.

I did a little soul searching last night after I got locked out of here, and made a more concrete plan on my portfolio asset allocations.

35% Growth/Income: Current allocation in line, includes T, HTE, MVO, and UNWPX. I wont be adding to these positions, other than dividend reinvestments. I am looking to sell HTE in the $30-$34 dollar range. If I get that opportunity, I will find a replacement for it at that time.

30% Blue Chip Growth: Current allocations in line, PCU, NOV, RCI , MIR and NRG. I will most likely lose PCU and MIR due to the covered calls that I have out against them (a mistake I wont make again). I will replace those with some new picks from Navelliers Blue Chip Growth, newsletter, due out on October 22nd.

10% Zip Code Changers: These are my buy and hold pipe dreams, which are actually under allocated at this point, but I will not be filling them in, until I get the last category reigned in. Currently holding LBWR, ZMRAF, and SYBR.

25% Value / Short Term Trades: Here is my real weakness. The ideas in this category have been coming at me fast and furious, and I have been like a kid in a candy store, completely without any impulse control. I likie, gimme, has been my mantra the past few weeks. My focus is on trimming this area. I reviewed ASTM, CSCA, EGHT, GAI, AND GNVC in my post last night (though part of the GNVC research got lost), so on those 5 I will be brief.

ASTM: News out regarding some stem cell research. I expect the gap to fill and then some. For fun I have a 1.39 sell order out there, which would give me a 25% return on a 3 day trade. Not sure if it will click that high though, as there may be some resistance around 1.27 and 1.32.

CSCA: Pulled back slightly on no news. I assume it's just a little profit taking before the 20 year anniversary. I still like this stock.

EGHT: Chart looks good, and up again in after hours to 1.52. This one just feels like it wants to take off.

GAI: This stock is still not exciting me. Down on volume, so it may be being manipulated. 65% shares held by insiders. Looking for a graceful exit.

GNVC: Up in after hours, no news, chart looks good. I like the technical on this since I don't see any real resistance until 4, other than perhaps a bit at 3.25.

NOEC: This one has been testing my resolve, since I posted about the swing trades I was planning on this post. It is going lower on low volume, and has inside shareholders at 59%. I have an 8.70 sell in, and while I don't know when it will hit that number again, I have little doubt at this point that it will. I do see some resistance at 7.50 that I have to contend with though.

PRX: Looking for an out. The chart looks terrible. This was a buy based on insider trades and a press release. Hasn't been a good move so far.

TGB: I like this stock so much, that I bought it again even though I have already lost money on it once this year. It reached new highs, and I jumped on, to immediately watch the price dwindle. It's a copper play, and I like metals. This one continues to haunt me. Looking for a graceful exit.

TRMA: My feelings haven't changed much on this one since the last time I posted on it. I'm looking for a sale on the downside of whatever happens between $38 and $43. I am hitting some resistance at $35.40 I need to break through now.

YHGG: This was a kid in a candy store buy. Looking for an out.

NCST: My short term buy for today. Chart looks good, and up in after hours. Support around $2.16 while my 10% loss is at $2.48. Fifteen day low at 2.16. I feel like I bought this one too high, chasing it.

So, my lessons for myself today begin with no more trigger buys off the short term board. At the minimum, I want to know what my 15 day low and support levels are, then I want to put in my buy price so that my 10% loss lands around those levels. I think this strategy will help me in many ways. First of all, it will make me pause and see if it is really prudent to add another stock to my portfolio. Second, when the stock is added, I wont have to decide where to stop, since I will have made that choice by my purchase price. Thirdly, I think that being a more technically choosy about picking a buy price than just looking at the current level two quotes, I will not be getting into as many stocks, which is part of what I limit this kid in the candy store reaction I am having to the multitude of earning opportunities that present themselves to me each day.

Always perform your own due diligence before making any investment.

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