I got very bad habit... after buying shares I am compelled to keep checking...

[Some-one]

I'm buying for mid to long term... definitely not intra-day... so according to all the gurus I shouldn't be concerned about intraday fluctuations...

I bought IBB and ANIK... now every 5 minutes keep checking and when I see it drops a bit more my heart plunges

If your heart plunges with a little bit of fluctuation, you have better sell it off coz the worst plunge would be coming real soon and what would you do then?

 

[Some-one]

i teach u 1 tactic.
go and run computer simulations of trading system.

The computer will tell you how good or bad the trading system is. Use that good trading system and stick to it. This way you can be assured that you will not make losses in the long run.


like for me,even though I am long term value investor, I still strongly believe in stop loss instead of averaging down. I need a risk management system. The trading system is my risk management.

I know that statistically, I will lose 3 out of 10 trades/investments.

That's contradictory. If you are a real value investor, you would be buying more when it goes down and when it goes up as long as it is still below its intrinsic value minus the MOS.

 

[ohgin123]

That's contradictory. If you are a real value investor, you would be buying more when it goes down and when it goes up as long as it is still below its intrinsic value minus the MOS.

Not necessary. If a stock is going down, there could be some problems that you did not anticipate. I will be very very careful to understand the reason why there is a sharp drop if it drop below my comfort zone.

Secondly, even if the stock price goes down, it can always go further down based on the trend at that time.

There could also be better opportunities else where.

 

[wahkao3]

That's contradictory. If you are a real value investor, you would be buying more when it goes down and when it goes up as long as it is still below its intrinsic value minus the MOS.

value investor doesnt mean i can ignore risk management rules.

 

[peterchan75]

If one believes in the efficient market theory then market's discounting mechanism should work all the times. But we know that it does not work all the times. You trade what you believe in.. long all the way down or short all the way up are the two predicaments that no investor would want to be in.

@TS, Since you are able to home into a hot biotech sector, I strong doubt that you are not aware of the volatility of biotech.

 

[Mecisteus]

value investor doesnt mean i can ignore risk management rules.

value investing and stop loss doesn't go hand in hand.

if the share price drops after you have purchased, it means

1) your margin of safety or valuation is just lousy OR
2) the company is getting more undervalued

 

[wahkao3]

value investing and stop loss doesn't go hand in hand.

if the share price drops after you have purchased, it means

1) your margin of safety or valuation is just lousy OR
2) the company is getting more undervalued

Yes they can go hand in hand.
buy undervalued stock. if hit stop loss, cut and run, dont need to think too much why.


I admit that despite covering many angles I could never do a good valuation. Some might turn out to be lousy. So my plan is that if those valuations turn out to be lousy, I just cut, dont ask why.

 

[Mecisteus]

Yes they can go hand in hand.
buy undervalued stock. if hit stop loss, cut and run, dont need to think too much why.

I admit that despite covering many angles I could never do a good valuation. Some might turn out to be lousy. So my plan is that if those valuations turn out to be lousy, I just cut, dont ask why.

if you are buying for the long term, cutting losses in the short term is not the right way. some stocks can go down 30% within 12 months and then rise multiple folds in the next 5 to 10 years.

 

[SgAhBui]

if u've identify a fundamentally sound stock, why not tank the short term drop?

 

[AlphaOmega]

If one believes in the efficient market theory then market's discounting mechanism should work all the times. But we know that it does not work all the times. You trade what you believe in.. long all the way down or short all the way up are the two predicaments that no investor would want to be in.

@TS, Since you are able to home into a hot biotech sector, I strong doubt that you are not aware of the volatility of biotech.

be that as it may. but overall the biotech sector is profitable, which is why most of my healthcare investment funds are in the ETF, not the individual stock. but from what i've read and studied, the company i identified have great financials, great ratios, is both growth AND value (and complies with CAN SLIM standards). i've read their SEC filings and i feel optimistic about its future. and i don't want to do what warren buffett calls thumb sucking, where by you doubt your research and you hold off buying a stock that goes on to soar. with that in mind, i've decided to invest a little in it.

if i lose money, i'll take it as a cheap lesson learned. if i profit, i'll be happy that my research and reading and studying paid off.

 

[AlphaOmega]

if u've identify a fundamentally sound stock, why not tank the short term drop?

i'm tanking what but does not mean i like seeing red figures

 

[Boorseye]

lost money when i kept checking stock prices when i started out. now i only look at opening and closing prices..

well, nobody beats the market so just stop looking

 

[peterchan75]

if i lose money, i'll take it as a cheap lesson learned. if i profit, i'll be happy that my research and reading and studying paid off.

OK... this should clear the air from what is implied in the title of this thread.

 

[AlphaOmega]

I bought ANIK for its high growth and value, and I'm confident it will do well in the upcoming period.

But since I bought it has plunged more than 5%. I have set stop loss at ~10%. Should I be worried? Should I sell if it hits my stop loss point or hold?

I have no idea why it is plunging. Correction perhaps? But it's still pretty undervalued in terms of PEG.

 

[peterchan75]

I bought ANIK for its high growth and value, and I'm confident it will do well in the upcoming period.

But since I bought it has plunged more than 5%. I have set stop loss at ~10%. Should I be worried? Should I sell if it hits my stop loss point or hold?

I have no idea why it is plunging. Correction perhaps? But it's still pretty undervalued in terms of PEG.

It's a small cap stock and being in the volatile sector makes it a powder keg.
Stock Quote ANIK

 

[AlphaOmega]

It's a small cap stock and being in the volatile sector makes it a powder keg.
Stock Quote ANIK

Yeah I understand that. But what I don't get is why the powder keg nature of this stock is causing the price to drop, instead of rallying. I mean, figures are presently very attractive and the financials are healthy.

Most importantly, did I make a mistake buying it? I did my due diligence and researched the company and industry and thought it was a steal. So is this turn of events bad luck or flawed research on my part?

 

[alexchia01]

I bought ANIK for its high growth and value, and I'm confident it will do well in the upcoming period.

But since I bought it has plunged more than 5%. I have set stop loss at ~10%. Should I be worried? Should I sell if it hits my stop loss point or hold?

I have no idea why it is plunging. Correction perhaps? But it's still pretty undervalued in terms of PEG.

If you are not going to honor your stop loss, why set it in the first place.

Traders don't ask if they should hold, if their stop loss is hit, they act.

The fact you ask this question, show you have a long way to go.

Remember, the stop is set for a reason, to protect your capital. I know that you scare of realizing your loss, but that is part and partial of trading. Sometime, no... in fact, most time, you have to realize your losses.

The question you should be asking is...

1. Is the counter you choose correct?

2. Is your entry correct?

3. Is your stop loss set correctly?

4. Is this loss a necessary loss?

5. How can I improve my trade in the future?

Please note that these questions are asked after you closed your trade, not during.

 

[alexchia01]

Yeah I understand that. But what I don't get is why the powder keg nature of this stock is causing the price to drop, instead of rallying. I mean, figures are presently very attractive and the financials are healthy.

Most importantly, did I make a mistake buying it? I did my due diligence and researched the company and industry and thought it was a steal. So is this turn of events bad luck or flawed research on my part?

I think you are a bit confused.

1. Fundamental of the stock only tells you if this stock is worth buying or not. It does not mean it's worth buying now.

2. Your due diligence is on fundamental only, which is okay if you are following Warren Buffett way of investing. Since, you are not as cash rich as him (I presume because you are using stop loss), then you cannot follow his style. In this case, you have to also include technical analysis, so your due diligence is kind of in complete.

3. You should work on your technical analysis, especially the entry.

 

[antonpoh]

I bought ANIK for its high growth and value, and I'm confident it will do well in the upcoming period.

But since I bought it has plunged more than 5%. I have set stop loss at ~10%. Should I be worried? Should I sell if it hits my stop loss point or hold?

I have no idea why it is plunging. Correction perhaps? But it's still pretty undervalued in terms of PEG.

Yup, looks like it's a correction.. and also some research firm downgrade it from Buy to Neutral/Hold.

ANIK Analyst Opinion | Anika Therapeutics Inc. Stock - Yahoo! Finance

For a PE of 28.6, it's not very undervalue.

 

[antonpoh]

Biotech sector may not perform as well as Medical Appliances sector.
You may want to checkout this stock instead.

Stock Quote KOOL

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