Trades and Rationales

The market was up handesomely today, and I swept out the system trade stocks a half day early to get the jump on any other system traders.

Sold

CHB $10.68 The one week hold was almost over and the stock was up large today.
GERN $7.41 This my baby was up 5 days in a row, and yet was still below its 200 dma.
RSC $17.37 A good rebound for this illiquid stock, also due out tomorrow morning.

Bought

CKFR 500 @ $34.13 One week rebound play for this Buyback Newsletter stock
EML 500 @ $26.725 Ibid, only this most actives plunger dropped 5% more immediately after
purchase, so its already underwater.

Mark Hulbert

Mark Hulbert recently pointed out that newsletter sentiment is not bullish, despite the market recovery, and that this bodes well for prices. He is a wise and hard working analyst, and I subscribe to his "Hulbert's Digest" and read his columns in MarketWatch.

Here is a link to his latest article:

http://www.marketwatch.com/News/Story/Story.aspx?guid={C85B5CD0-BD39-4789-A646-76F967A05BFB}&siteid=mktw&dist=nbc

Just Dodged A Bullet

Adolor reported today that results of their latest study on Alvimopan show that it increases the chance of cardiovascular events. They also said that they, and partner Glaxo-Smithkline, are halting all clinical trials on the drug. Predictably the stock price of ADLR cratered, dropping
57% to $3.75. I think it will drop more, I am damn glad to have gotten out of the stock just last week, for it has been a favorite of mine - the market for opoids that do not affect the gastro-intestinal system is just huge.

What this shows is how risky one trick biotech stocks are, and how well deserved any success is that comes their way. In the meantime, Progenics (PGNX) is the other pure play biotech company with a product designed to meet the same needs as Alvimopan.

Trading Summary And Analysis

I've just completed my analysis for Feb 22 to an intraday time today, April 3:

Benchmarks: SPY -1.43% QLD -6.31% Russell 1000 Value -.83%

My stocks showed a profit of $1270.5 net of commissions: $1030.5 (24 trades).
Since my starting amount was $112 437 (includes the add on) this is 0.9%

I used six basic strategies, grouped post hoc with average results as follows:

a) Buyback and value: -3.7% seven trades
b) Buyback and > 3% one day drop and > 200 day avg: 2.2% three trades
c) other <5%> 200 day avg: -28.4% one trade
d) Subjective story: 11.8% averaged over five trades!
e) Sentimentrader timing trade: 1.4% over three trades
f) 5/1 plus value plus 5/1 industry: 4.5% one trade

These were most of my trades, a few are omitted because I'm not sure why I made them.

These are my conclusions:

Foremost seems to be the large loss I had buying TSTC, a high flying small cap stock that had a large one day drop due to disappointing earnings. It just kept going down. I'll make sure the stock has a low PE if the news is bad earnings, and stay away from blogging chartists' recommendations.

The other bad area was the poor performance of my Buyback passive portfolio. I'm not sure what to do about this, perhaps it is just the large variance, but perhaps the buyback stocks don't do well unless they are moving a lot already, up or down. My adjustment will be to hold fewer stocks but to put more money in them, and to trade situations more.

On the positive side was the standout performance of my subjective selections. LEND and ADLR deserve remembering, and it shows how being interested in stocks and their stories can pay off big time.

Also worth noting is CTB, a value down 5 year/ up one year stock. It is doing well so far.

Also doing well was the strategy of buying stocks that are down large but are in one of my lists (like Fry or 5/1), and the strategy of buying indiscriminately when Sentimentrader gives unequivocal signals.

I must fine tune the Hulbert signals for gold - finding a reliable vehicle - and the short selling strategy I've devised from his newsletter data.