Now, I will tell you all something...
Yes! I lose money on stocks! Everyone does! And everyone has "a stock" or stocks that they bot that went down the crapper. I can raise my hand to losing my shorts (lol!) in WebVan - wow - that should tell ya something! I have a ton others I could list for ya off the top of my head! Yes... we all have had "toilet stocks" in our ports and we will always have more in the future. The trick is to have less of them. To learn from our "flushing" experiences.
I have learned to stick to my stop loss rules. The high Beta stocks will have a higher stop-loss percentage than a lower Beta stock. But, you simply must stick to your stop-loss rules! And of course, "toilet stocks" are also why I stress the importance of diversification in your portfolios! In my opinion, you simply can not put all your money in one stock!
There are 2 reasons I do not post my sells. 1. It would take me more time to do so; and 2. I am assuming you know when I sell, as I stick to my stop-loss rules. It is pretty safe to assume that if a stock I "rec" goes down 12% from my cost basis, I have sold it. Let's see... KONG, GMKT, IAAC, KNOT, MPEL, IFLI.OB, HBI, MET, BARE, CYTR, AMSF, SFE, DISH, BDN, ADY, CNW, PAY - I have a ton of them!
Now, that brings me to another thought! When someone buys a stock, they did their DD on it beforehand. Right? I do - at least to the best of my abilities. And if the stock "tanks" and they have to sell out due to their stop-loss rules, it does NOT mean they can not buy the stock BACK at a later date! No! I like to keep track of the ones that I have to sell out of, because there were reasons I bot it to begin with, and maybe at a later date it is a better time to buy in. And some of those toilet stocks eventually turn out pretty well!
I am rambling on here, but I just thought I would let you all know that I have had toilet stocks. You have had toilet stocks. We will always have toilet stocks. That is all part of the market. It is nothing to feel terrible about for days on end! No! We must learn from them!
Now... if you will excuse me... I need to use the restroom. ;)
12 Comments:
thanks for bringing this up! We all need to take a step back, look at our FOLIO and rank/rate our holdings.
if you are holding a stock that you wouldnt buy today or your original thesis for buying doesnt hold water anymore...flush it, eh?
a la Cramer, rank from 1 to 4, sell your 4's today on put the money into 1's, ...on the dip ofcourse!
-BOTD
Mr. Dip,
It is always good to "review" your stocks. You know... when I first started investing, I did not even think about buying a stock back if it "tanked". It never occurred to me.
LOL! Yes.. every day is a learning experience! :)
Some stocks get flushed and stay there. Just do a scan of stocks at their 52-week lows. Bleah! But! Some "come back"! So... just keep an eye on things and yes... I agreee, buy on the dip! :)
vonage is a toilet stock i lost a lot of money in it!!
Ah, yes! Vonage the dog, I believe Cramer "crowned" it! Another learning experience.
I've always said that Ty Cobb has the best batting average in Major Leauge Baseball history and he failed more than 6 times out of every 10 tries. If you can cut your losses appropriately on losing stocks it only takes one home run to make some big bucks!
Rob,
That is so very true! And that also reminds me that we all have to keep on trying - we can't throw in the towel after striking out ... we need to bat again. :)
Poor Dick Fosbury...
LOL! Bill!
Well, aren't you glad it is that and not a pogo stick?
Indeedy!
lol!
Last year, 07, has been great for all my investments (12 total) except two toilet stocks. One I feel sure will come back and another I'm not so sure. The first is MPEL and the second is CROX. Both have been huge losses for me. I'm going to take the hit on CROX this year and maybe take the money and dump in MPEL as it close to it's all time low.
Here's to a great 08 and keep up the good work goddess.
Goodness sakes! What are you doing down here in the basement? This is a July post! hehe
Actually, I am glad you made me revisit this as seeing that little animated pic makes me smile. hehe
btw, who you be?
As to CROX... I wear mine every day. I can look right now - over there - to the right - see them on the floor? Yes, I wear them still, but do not own the stock. I am a bit miffed when Cramer said recently that they are more like a HLYS than a NIKE. I am still of the mind that CROX is not a fad! However, as I stated before, the reason I sold was because the company lost my investor confidence when they sold a gazillion shares. And I see that business is slowing. However, that seems to be the case for many companies now. I will revisit CROX in the Spring.
As to MPEL... aaaaah! My little MPEL. Wow! I really thought that this stock would take off. Tell me, what your reasoning is for putting more money into this stock now.
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