Saturday, September 14, 2019

Generating Capital Gains



Just a quick hit post and to give you an update of what has been going on in my trading PF lately. I'm in Kelowna on holiday right now so that's why the delay in posting anything of relevance.


Current Holdings

ALO, ATH, ASM, BTE, BDI, CPG, ERF, GPR, GUY, LAC, TCW and WEF

Up $1450 on paper

Realized Gains = $1902

Transactions

Bought WEF Sep 11 - Lumber stocks have been hammered. The cure for low prices is low prices. I bought 3000 sh @ $1.30. I'm up 2% on the trade. I like the stock here and nobody is buying it. Perfect.

Bought LAC Sep 4 - As with Lumber stocks lithium has been lagging. I like this stock as a longer play on the electric car market. The price has really come off so I picked up a small position. Buy them when they're cheap. I bought 1000 sh @ $4.20. Up 13.5% on the trade.

SOLD LMC Sep 4 - Booked profits on Leagold Mining of $1650 on 2000 shares. I bought LMC on 29 July for $2.00

Bought TCW Sep 4 - Energy service stocks also getting crushed all year so I was watching for volume picking up in this sector. You could have your pick. I bought 4000 sh @ 0.97. So far up 21%

Bought BDI on 4 Sep - Another play on a pick up in the energy sector. Camp stocks like BDI hopefully rebound here. Bought 2500 sh @ $1.72. Up 6% on the trade.

Bought ALO 3 SEP - Gold stock laggard 4000 sh @ 0.96. So far a bad pick up. Down 4.5%

Bought ASM 27 August - bought back in after selling for a great profit on ASM. 5000 shares @ 0.89.Down 9%.

Sold TGOD 27 August - booked a $170 profit on 1500 shares sold at $3.18. I'm completely out of the weed sector ATM. The falling hasn't stopped but some trading opps lie ahead in this beaten down sector. The easy money has been made.

Final Thoughts

I bought back into some gold and silver stocks a little too soon so I was wrong there. GUY on paper is my big loser down 20% and has lagged the whole sector. GPR has also been a disappointment.

Paper gains mean shit. It means I got the buy right but still haven't made any money.

All told I'm up $3,400 in this account if I sold everything right now.. I won't but the point is even when I'm wrong on a stock doesn't mean you lose on the overall trading portfolio.

On paper I'm up 40% on CPG. This is helping carry the day. Should I sell and book profits.? We're getting close because all the experts are recommending energy stocks. That's usually a good time to sell. I'll see Monday.

It's been stressful visiting family and holding a lot of commodity positions that need constant monitoring. It's like puppy training. You take your eyes off for a few minutes and there's shit on the carpet.

Copper stocks starting to look interesting along with pot. Always look in the valley for opportunities. Never buy at the top of the mountain.

Just what I'm doing and not what you should do. This is a strategy to generate capital gains and have some fun money.

Wednesday, September 4, 2019

Investing Basics - Nobody Knows Anything




TITLE: Nobody Knows Anything
AUTHOR NAME: Bob Moriarty
AUTHOR CREDENTIALS: Veteran, pilot, consultant and author
GENRE: Personal Investment Strategies
NUMBER OF PAGES: 134

PUBLICATION DATE: May 2016

SYNOPSIS/SUMMARY: From Amazon


"Has following “the crowd” with your investing lost you serious money? Learn the strategies best suited to get you more reliable results. Are you confused by the flood of contradictory advice from so-called experts? Have your past financial advisors cost you years’ worth of savings? Want to make sure your hard-earned dollars are put to the best use? 

Over 50,000 readers a day trust long-time investor Robert Moriarty to show them which tactics work… and which ones don’t. Now he’s here to show you how to avoid failure and find the pathway to profitable growth. 

Nobody Knows Anything: Investing Basics - Learn to Ignore the Experts, the Gurus and Other Fools is a straight-to-the-point handbook for any investor willing to question mass-market hype to find what actually works. 

Cutting to the chase, Moriarty’s contrarian insights explain how you can use your own knowledge and skills, however limited, to buck the trends and defy the popular professionals. Inside, you’ll learn why the crowds are almost always wrong, and how you can go against popular opinion to make a positive return. In Nobody Knows Anything, you’ll discover:- The biases and agendas that distort most investment decisions and how to dodge them- 

What contrarian investing really means and how to do it with precision- 

Ways to see past the buzzwords and guru messages to get the honest truth- 

Whether market manipulation is really an issue and what to do about it- Investing tools, techniques, anecdotes, and much, much more! 

Nobody Knows Anything is the book you need to expose expert advice and find long-term success in the financial market. If you like easy-to-follow steps, down-to-earth strategies, and going against the grain, then you’ll love Robert Moriarty’s powerful resource. Buy Nobody Knows Anything to find out how to make your money work harder today!"


This is an extremely short read which you can devour in just a couple of hours. Bob spends the first 20 pages of the book talking about his other favourite investing book called "Extreme Popular Delusions and The Madness of Crowds".

Basically reminding us that we are herd animals and tend to go where the herd goes. We've done it before and we continue to do just that when it comes to investing. This can end up costing a lot of money and not allow us to take profits when we are given them. NO! the herd keeps holding which usually results in a loss.

EPD covers manias of the past like Tulipmania, The South Sea Bubble and others that have caused human beings to go insane to make money and follow fraudsters like Bernie Madoff.

I had no idea a genius like Sir Isaac Newton lost his life savings on a misadventure like the South Sea Bubble. EPD is a great book to educate yourself on the history of these manias and how they are still happening.

Being a Contrarian

Pretty much this is the whole essence of the book. If you want to make money flipping stocks, be a contrarian. Bob gives a history lesson on some recent investing manias that a lot of us have lived through.

Remember this - The Herd is Always Wrong

Not sure if that's right?

Who fell for Y2K?

We all did. Good example? The world was going to grind to a halt and stop working. People were stalking up on canned food, gold, cash and water. The whole Doomsday Prepper movement was started on this nonsense. Millions were made and fleeced from the herd and businesses that needed their computers upgraded. It was all bullshit.

How about other recent manias investors are caught up in?

Dot Com stocks, Pot stocks, Bitcoin, Lithium, Rare Earth Elements, Uranium, Gold and Silver and on and on. You name it and the herd stampeded in. Some made money and some were late to the party as always happens. 

Why is that?

Because the dumb money buys at the top of the mania and the smart money accumulates at the bottom.

The exact opposite of what the herd does. This is the essence of Bob's book. You must think and act differently from the herd.

You must take profits. IF NOT, the alternative is to take a loss!

To do this - BE A TRADER when it comes to investing in these stocks.

BUY on low volume and SELL on high volume!

The Next Big Thing

Great chapter for traders about looking for opportunities.

These are created by newsletter gurus. Guys like Jim Dines and Doug Casey. Investors like Eric Sprott. They create manias. How? Massive subscriber lists, slick and glitzy marketing. People want in and nothing can stop them.

Once they get in guys like Sprott, Dines and Casey are taking profits. Usually because they own enormous stakes in the companies or commodities they are pushing and heavily promoting.

Gurus take to the TV and make recommendations to the herd to keep them satisfied. How can everyone be right recommending six stocks a day week after week? They aren't. Gurus know when to take a profit. You need to do that too!

Just go to any discussion board on any pot stock on Yahoo. People are bat shit crazy about these stocks. They natter on about the long term prospects even when they are down over a 100% on their money. You are labelled a troll for even questioning their thought process.

The pot mania is OVER! You are a loser if you didn't take your profits early. News Flash - NONE of these companies are making money. The granddaddy of them all has lost over $50B in market cap and has not even made a dollar. WEED. TO. Those who took profits months ago were the smart money. Of course they claim to be long term investors because they have no choice but to hold and try to scratch back their money.

Bitcoin peaked at $20K but still there were buyers until they got drowned in the shallow water by sellers. It's now just over $10K a piece. Are you buying? Do you believe lightning strikes in the same place twice, three times? You decide but just ignore the fools on these boards.

Manipulation

One of those words you only hear the whiners use when they're not making money on a badly timed investment. It's a whole industry itself. You never hear claims of manipulation on the way up. NO, they just tell you that it's now a free market and this is how it is supposed to work. On the sell off they all scream manipulation. Again, ignore these fools and take your profits early.

Silver went from $4-$50 and gold peaked at over $1900 and now sits just above $1500. Manipulation? fuggetaboutit! please. Bob loves to talk about manipulation.

When to Sell and Why

First of all, ignore all the mainstream daily business news. There is no correlation between what you hear from TV gurus and your investments. Do they tell you what to buy that's down and being sold off?

NO! but that's where to look for opportunity.

Bob recommends selling a position and taking profits after a double. SELL 33% of your position each time your stock doubles if that happens. Investors get greedy and hang on too long. If it gets to a top sell part of your holdings and take some profits.

Protect your capital. He provides some great individual examples of gold stocks that rose dramatically and then in a few short years gave it all back.

Lots of great tidbits of investing advice here.


My Final Take

Bob also provides a great list of resources he uses to make decisions. Chart services and newsletter writers.

Bob also runs 321gold.com and 321enery.com

he is a trader and if you are too then this is a good primer to keep you motivated.

Be a contrarian and look in the bargain bin for stocks and don't buy what's high and expensive.

Ignore gurus and news.

Everyone else is biased and has an agenda. Beware of who you listen to and what and why you are buying a stock.

I loved this book and I think everyone should have it on their shelf.


Thursday, August 22, 2019

Income Investing and My Retirement Strategy


My friend Henry Mah wrote a book called 'Your Ever Growing Income'. It is based on using a dividend growth strategy to grow income for retirement. If you don't own it you need it.

What does that mean?

A lot of things like; being a do it yourself investor, knowing what stocks to buy to fund your retirement and how to live off that income.

I use this strategy in all my retirement accounts because I'm comfortable with it and believe for me it's the best way to supplement my monthly pension cheques with monthly/quarterly dividend income.

There are so many investment strategies out there it can be overwhelming to us average people just trying to grow our money. This is just one of them and may not be for everybody.

Henry has posed a series of questions that I will now answer as it pertains to me.


What Stocks Should You Buy and Why?

I buy stocks from a small select group of companies for retirement.
  • banks
  • telecomms
  • pipelines
  • utilities
  • railroads
Just this week I added to my positions in RY, TD and BMO.

These categories contain the stable, old and established companies that have a history of not just paying a dividend but raising it year after year.

Royal Bank has not missed a dividend payment since 1942. Except for 2008 it has also raised that dividend every year. This is how I invest for retirement. As a starting point I started with 1 company from each category. Currently I hold a max of 12 stocks in any one account.

How Should You Evaluate the Merits of the Stocks you are Considering?

I look at a 10 year track record of paying a dividend and raising it. I then look at how cheap it is selling for when I have the money. Some stocks are cheaper than others. Looking at a chart will tell you where it stands. Check out a current 1 year chart of EMA. You think it's cheap to buy right now? NO! 

So I look at a combination of things before I deploy new cash to buy income producing stocks. It's not a shotgun approach. All banks are cheap right now and also provide that growing income I look for.

When Should You Invest More Money Into New Stocks or The Ones You Already Own?

As it builds up in my account from dividends received.

I basically just add to the stocks I own which is a core of 10 stocks.

When Should You Sell Your Stocks?

If you have too many in one category. I sold CIX and SJR-B this week. They both underperformed my expectation and lagged other stocks I owned in the same category. I deployed the money into bank stocks I already owned, concentrating my PF further.

Should You Be Worried When The Market and Prices are Going Down? Why?

NO! I get excited by this.

When prices come down it's time to buy stocks that you have been looking to own. Utility stocks are expensive right now. Should you own some? YES!

Wait until they get cheaper to add is what I'm doing. Once you have a core of stocks then you can look to add on days the market is going down which is just a flashing BUY sign. This is what the smart money does. Look for down days don't run and hide. If you have no money or no desire to buy stocks just ignore one time down day events. You'll sleep better. Royal Bank is NOT going bankrupt.

Should You Diversify Into Other Stocks, Sectors and Markets?

To each his/her own. I mentioned above what I think the stocks are that retirees (of which I am) should be invested in.

I also like food as an investment sector. In one account I own Costco. That checks off another market (U.S.) and another sector with one holding.

People have to eat and food is a stable sector for income investment in my opinion. It's also essential for us but whether it's essential for your retirement is a matter of personal opinion.

My quarterly dividend payment combined with my yearly member's coupon pays for our membership in Costco. Use this strategy as a hedge at a place we like to shop. It helps ignore the annual fees when you're a shareholder too.

For tax purposes I stick to mostly a 100% Canadian Maple Bacon Portfolio. You can use that name if you want.

Should You Worry About Asset Allocation and Rebalancing? Why?

This philosophy comes from Modern Portfolio Theory which I don't believe in or subscribe to. It was invented to make advisors sound smart to sell investment products and funds to retail investors.

Charlie Munger calls it "twaddle". Basically just a set of words used to confuse people about investments.

I don't worry about it and add money to stocks when I have the money and the company goes on sale as mentioned previously.

I also don't believe in 60/40 balanced portfolios. More twaddle!

Should You Worry if your Stocks don't Perform as well as the Market? Why?

No. I don't even monitor or gauge this. I pay attention to dividend increase announcements. This way, I know my invested capital is growing and will continue to provide me with a growing income through rising dividends.

The greatest threat to retirees is running out of money. To avoid that scenario make sure your yearly dividend income is rising. If not, look at your investments and choose those ones that will help you achieve that goal.

When Should You Invest in ETFs, Mutual Funds, Bonds and GICs?

I don't and don't own any of these products. Buffett says most people (90%) should just buy a fund or ETF that tracks the S&P 500 and add to it monthly when you have the money.

I have tried all these products in the past and I'm now 100% individual dividend growth stocks. It's NOT for everyone it's just what I do and NOT what I recommend anyone else should do.

It's just what works for me and what I'm comfortable with. What you should have is a strategy to get to and live a comfortable retirement without running out of money. 

How Do You Determine How Well Your Stocks Are Performing?

Yield + Growth = Total Return

Is the yield growing? How much on a yearly basis? Is your investment going up or down in value? Nothing else matters or deserves attention.

Oh! Do you sleep well at night? If not, time to make some changes so you can.

Final Thoughts

I am not a personal finance blogger. I'll leave it to others on how to save, clipping coupons, how to get a cheap flight, what's the best credit card, budgeting and where to cut expenses.

I simply document and share my experiences trying to grow my retirement money and income. I document NOT create content or anything new that  investors don't already know. I just tell my story.

I further believe that if you are already retired then you MUST become an income investor. That way you can ensure you won't run out of money and in fact have even more money the longer you hold your income stocks.

Lately, I have been using some spare capital to invest for capital gains. High risk and I hope high rewards. I could lose all this money, but I have set it aside for gambling purposes.

I have been documenting my journey a couple times a week while doing this trading. Check back often to see how it's working but don'y buy and sell what I am unless you are prepared and can afford to lose most of it.

Thank you Henry for the invite to the questionnaire. It's been fun. Good luck to all trying to grow money and secure a financially sound retirement.

Saturday, August 17, 2019

Swing Trading and Portfolio Update

Why bother with this type of trading? I guess I like to be contrary. I like the fact that oil and gas stocks here in Canada are being given away. When will you make money on them?

Just when you feel you've bought them at a good cheap price they all go lower.

I used to exclaim all the time that I would love love to buy Baytex Energy below $5. I did manage to buy it at $1.91. Guess what? You can now get it @ $1.75
It's beyond ridiculous.


My Portfolio

ATH 5%
BTE 8.6%
CPG 1.7%
ERF 4.8%
GPR 11.5%
TGOD flat
GUY 14%
LMC 11.2%

Just a terrible week as more bad news out of the weed sector caused me to give up all my gains before I could lock in profits. The week taught me that I need to take money off the table before the close and not wait for the next day. This was costly for TGOD. I ended up selling and buying back my position where I started a week ago.

My energy stocks all came roaring back but are still down a bit. Gold and silver selling and gaining based on what the President says and tweets. It really is hard to keep up.

All in I'm down 4.3% on the whole of my holdings. I've sold 6 stocks for a total gain of $242.13

I made money on TGOD and ASM. Lost on the other 4 trades I sold at a loss. As you can see, sell early, conserve your capital and you'll come out ahead. 

Swing trading is stressful and you have to be patient. Buy when they're down and starting a base. I like to watch the 21, 50 and 200 DMAs.

GPR looks like a mistake and ASM is starting to look like a buy again in the fall. I'll be watching.

I would also be down a further $3000 or 13.6% if I would NOT have sold
ASM, CLIQ, EFR, PEY and GUY when I did. This is the importance of money management

However, I am down on paper $1678.

I really hope that next week will not see this much whipsawing on the markets and oil starts to move on good news. We'll see.

This is pure gambling, take your money early and be patient. Good Luck!

Thursday, August 15, 2019

Massive Market Drop and Selling TGOD

So we had a 800 point drop on the Dow and a 300 point drop on the TSX.

Both one time multi year events. Is there more to come or a relief rally on the way? I don't listen to experts but when they said this August would be rough they were right.

We had a massive sell off yesterday and the futures are pointing to another down day today.

Risk appetite is leaving or has already left. I decided to sell my 1500 shares in TGOD and lock in a measly $180 gain on my position. Why?

What I consider a poor earnings report showing another loss of $16M and revenue of only $2.5M. It's all about the future with weed stocks and so far all are losing money. If it continues to drop lower I will try and get back in for another swing trade.

All my energy stocks are bleeding red except for ERF Enerplus. I may have waited too long to sell. I really only had one day to execute before oil as a whole started to sell off. Oil is set to open lower again.

What's the old adage; "The cure for low prices is low prices". I really hope that rise happens.

We're still a long way from $28 oil which is the low but the stocks are getting the shit kicked out of them.

I'm looking to buy more GUY today. I like it here and gold wants to go higher.  This stock is lagging the sector, we'll see.

My buy of GPR has NOT paid off as the stock just drifts and there doesn't seem to be any hurry to get in. All the silver stocks are pulling back after a nice run.

If I had more money I would add to my bank stocks in my retirement accounts. You have to love it long term when these stocks sell off so you can add to your monthly income. Add income as these stocks get cheap, will bode well for your retirement.

I'm not selling anything in these accounts. Shaw and CI Financial have been a true disappointment. They are tanking. I have time and as long as they don't cut dividends I'll hold.

Be careful and cut your losses early to conserve capital.

IF YOU DON'T TAKE A PROFIT YOU'LL TAKE A LOSS

Wednesday, August 14, 2019

Extreme Investors



I read a lot of blogs and visit a lot of stock discussion boards, hardly ever comment because of the inevitable pissing contests with knowitall investors.

Mostly I just watch the market for unusual spikes in trading volume for particular stocks.

Today I bought ATH Athabasca Oil for that reason.

Up on the day with double the normal trading volume. It's been as high as $1.78 this year. I bought it at 0.63 cents.

Could it double frome here? Dunno. I like to buy stocks that are down with potential to get back to previous highs or at least take a profit. I sold my CLIQ for a slight gain after the stock gave up all of it's gains since it posted earnings. The market is not giving it much love and volume is drying up so I'm looking for more potential profits. I sold it and with the money bought 8000 shares of ATH.


"IF YOU DON'T TAKE A PROFIT YOU'LL TAKE A LOSS"

This is taken from a book I just read by Bob Moriarty which I need to post a review of. Love it and great book.



Why is this important? Well people just think they know everything about a particular stock they just bought. Just go visit a stock focused board and click on the symbol and join the discussion.

What I find is most are so biased they become rabid stock pumpers. Just as bad as trolls.

Here's whats important. Know what the market is doing. Gold just reached $2000 CDN for the first time. Is it on sale now? NO!

Should I take profits? Watch the volume and how the market is treating your stock. I'm up 20% on TGOD. Should I sell it? HELL YA pretty soon. I want to lock in that profit so I can protect my capital.

I also learned this listening to Phil Hellmuth the gambler. This is gambling so the advice is appropriate. He basically says that the most successful gamblers in No Limit hold'em poker are those who cash in a little bit each tournament.

Hear that? He didn't say WIN. He said cash in. So you play smart and make the top 64 or whatever you need to get there. Just play smart enough to get there.

You have to cash in when you can. TGOD announces earnings today and we'll see the reaction. I will take my money and run.

Too many buy more when stocks they bought go down. I never ever average down on my trading stocks NEVER!

People become married to stocks. To win, cut losses when you're wrong and cash in when you're right. Just like a poker player does. They fold when they suspect they're beat.

For the record I don't go to casinos and gamble. If I was rich well maybe.

The extreme investors you see never sell. How do you make money trading stocks doing that? How would you win at poker with that mindset. Focus on taking profits and buy when they're down.

The dumb money buys stocks at the top. The smart money sells. 

I like to buy at the bottom, that's the smart thing to do.

This is why energy and weed stocks are starting to move up and gold stocks will be heading lower. I am not doing this for long term holds.

This is trading and gambling. Know the risks and always take your profits and move on. Never hang on to losing stocks hoping they go back up.

Extreme thinking will get you killed. Develop you're own strategy for making money in stocks.

Update: TGOD announced earnings. Loss of $16M and a revenue increase of 20% or $2.5M. I'll wait and see how the market reacts but I don't like the losses although expected. Long term who knows, but that's not what I count on.

Tuesday, August 13, 2019

New Stock Buys and Portfolio Update

Just a quick short post today as I've been away on a little holiday.

I decided not to to publish any posts as I'm just too bust decompressing and relaxing to hit the computer.

I did manage to buy back into my Guyana Goldfields GUY position and also buy Great Panther Resources GPR.

Gold and Silver seem to be running away with all the market money so why not jump on the train. Today's futures seem to indicate another move higher.

Portfolio Update

CLIQ 1.7%
BTE 7.5%
CPG flat
ERF 2.6%
GPR 3.7%
TGOD 18%
GUY 1%
LMC 8.4%

As you can see stocks are all over the place. I look for areas where stocks are lagging and then are set to move up after forming a base.

Avalanches always start at the top and never in a valley - Bob Moriarity

Look for the valleys.

On another note, I mentioned lumber stocks a little over a week ago.

One of my watchlist picks Canfor Corp CFP has risen 60%.

Did you buy it?

NO. Me neither. Stock popped on news it may be taken private.

So, look in the valleys and what do we find?

Nat gas, uranium and lumber stocks which are starting to move. I was too early on PEY and EFR.

Cut Losers Take Profits

I would be down a further 3.7% hanging on to losers so far. Stocks I sold at a loss and continue to drift lower are; PEY and EFR.

ASM is also lower than my sell price and has not gained it back.

My regret here is that I sold GUY too early. It has it seems started to join the party so I bought it back and I will look for profits sometime in September.

Trading is not for everyone and you could lose everything. Only paly in this sandbox with money you can afford to lose.

I'm up on paper after selling and buying $956.

These values change every day but I continue to like the commodity and weed space to provide some short term Capital Gains.

Stay tuned for another volatile week on world markets. These stocks are not being held for the long term. This is my hobby. What's yours?

Generating Capital Gains

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