Note from the Author: My first article, Helpful Stock Indicators - Part 1 can be found by clicking on this link. My second article, Putting My Money Where my Mouth Is - Technical Indicators - Part 2 can be found by clicking on this link; Part 3 can be found here. This is the 4th Article in this ongoing series. I am not real happy with this portfolio ... but it is what it is and this should show you the real need to manage your money properly and have a "game plan" for entry and exit points.
Please remember this portfolio was put together with nothing more than a technical indicator known as the MACD. See part one for that story. I have done no other research on these holdings … I simply wanted to see what one technical indicator would do for me.
If you recall when I shared this article in part 3 this is where the portfolio was at that time:
Now let’s take a look at see what the changes have been over the past 27 calendar days which is slightly more than one trading month.
If you analyze these two tables you will see that in the last 27 days the active portfolio (stocks remaining) have gone from a value of $46,142.85 to $47,539.21. That is an increase of $1,396.36 in 27 days or a return of 3.03% in a month.
The active portfolio is now up $2,571.85 as compared to being up $1,175.49 one month ago. So, a return now of 5.72% as compared to a return of just 2.61% 27 days ago.
Had I held onto the stocks I sold I would be down on those three by $2,122.26 as compared to the loss of $2,150.62 I took when I sold them. So, not much of a change there.
Had I sold out of the portfolio a month ago I would have suffered a loss of 1.50% overall (e.g. I would have gotten $64,039.04 back on the investment of $65,014.17. If I sold out of the portfolio today I would have gotten back an overall gain of $421.24 (+0.65%) buy taking out $65,435.40 as compared to an investment of $65,014.17.
If you consider the holdings I still own we see the following changes this month as compared to last month and the original investment, you see this:
It would appear that since my original investment and over the past one month … CE, MRO and PWR would be my best investments. If you recall, I took $17,896.19 off the table when I sold CXO, MOS and IPG. With the stock market being mixed today (Dow now down 100+ points, the S&P up 3+ points and the NASDAQ up 24+ points) I think now would be a good time to invest more into CE, MRO and PWR.
This is what I said in my part 3 Article on this subject: “What I could have done – though it was not part of the plan – was to invest the money taken out when the stocks were sold and invest those proceeds into the winning stocks. This would have had the overall portfolio up even further. Perhaps I will do that on a future portfolio test.”
So, I am doing it. If it were possible to split this available money equally among the three companies that would allow me to invest $5,965.40 into each company. However that is not possible so this is what I did (this is right out of my brokerage account):
You can see I purchased 54 more shares of CE, 330 more shares of MRO and 149 more shares of PWR. This is a total investment of CE $5901.98 + MRO $5,971.75 + PWR $5,981.69 = $17,855.42 of the $17,896.19 that I had available.
Now that it is done … here is my new tracking sheet. You can see I have removed all the ones sold in the past and added the new entries so that you will see two entries of CE, MRO, and PWR. Hopefully, Eli Lilly (LLY) will improve in the short term.
Here is another thing I am considering for this portfolio to get more “bang for the buck.”
I am considering selling short-term out of the money call options on those stocks that hold more than 100 shares to provide an income stream to the account. If I do this I will track that income to show you what is available and the benefits for doing this. I may not start this for another month or so, as I want to make sure I have the time to monitor it as it should be. I am still looking for overall profits of 50% or losses of 10%. Patience is the key, especially since I have other monies working in other places.
I’ll check back in, in about 30 days or so. Until then …
Go make some waves,
Jerry Nix, FreeWaveMaker, LLC
This information is not recommendations for you to purchase or sell any investments outlined in this article. The information is being shared for educational purposes only. I recommend that you seek the advice of a licensed and competent financial advisor before taking actions on your portfolio if you see a need to after reading this article.
The author of this article is long on the following investments outlined herein: FL, CE, CAT, MRO, PWR, OKE, LLY.