Buying and Selling Stocks

With all the controversy swirling around Facebook I decided to dump my position and lock in my 10% gain.

On the same day I decided it was time to take profits on CSU.I bought the stock for $926 and sold it for $1096. Close to a 21% gain.

I took the proceeds from my FB sell and bought Encana. Yes, an energy stock. This is just a short term hold and I'm hoping to just gain a couple bucks before selling.

This is just a way to grow money around the core of my portfolio. I don't bother touching the DG stocks I use for income but just trade around them. This is just one way I try and accomplish that.

What about and why ECA?

Most energy stocks are trading at really low levels compared to their 52 week high.

ECA has been as high as $18.54. I purchased 500 shares at $9.87.

Just a small position but I still believe all the risk is to the upside. Time will tell but I believe you buy these stocks when their beaten down for a quick flip and not use them to retire on and forget about. That's just a recipe for disaster.

ECA also pays a 1% dividend but I'm in it for the capital gain and not as an income generator.

There is resistance at $11.67 and if it makes it up there I will be looking to exit. It has been coming off the bottom nicely and looks to be trending up. Anything can happen but when you are looking at flipping stocks, I believe buying them when their down by over 50% off their highs.

The energy sector seems to be displaying a lot of stocks that fit this criteria of mine. You have to watch them like a hawk as commodity stocks can drop like a stone and wipe out all your gains in no time.

ECA pays out it's divy in American dollars and derives 50% of it's production from it's U.S. assets. That's good diversification.

The long term problem with the Canadian energy sector is getting oil to market. We have run out of pipeline capacity so investment dollars have dried up in recent years punishing a lot of these companies.

I'm not interested in the fundamentals here, that's not why I'm taking a gamble here. It's just a short term flip if I can get one in the next 1-3 months.

Oil is very seasonal and cyclical that's why I never hold them long term. I believe ECA has nicely come off it's bottom and I'll watch it for more of a pop if we continue to get higher oil prices.

The company itself is not going away as they've been around since 1971 and is well diversified between natural gas, oil and liquids.

Last year gold and pot stocks were beaten to a pulp and you could have flipped them for some good money. I believe some of these oil stocks are now in the same position now.

Whatever you decide to do keep your eye on the prize and have an exact exit point and take your profits when you reach it.

Other stocks on the TSX you can also look at meeting the same criteria include; STEP, CPG and MEG.

Good luck trading and growing your money!