After running a very successful private hedge fund for several years, I often look back on my challenging foray into the world of mutual fund management. I vividly remember thinking that the transition would be no different than a new custodian a few new reports and a daily NAV. That was until the first day I decided to book a good run and move to cash. The nightmare began with a compliance e-mail informing us of our misdeed and requesting detailed information as to why we took such ‘cautious’ action. It never ended until that final trade two years later.
The freedom an individual trader has in clearing the decks after a good run is equal to that of a poker or black jack player stepping away from the table after a good hand. It is exhilarating to step up from the table actually saying ‘I won’ and have something to show for it.
Do I leave moey on the table at times? You bet. Do I look back and many times swear off early selling? Well, I used to, now I simply chuckle and remember that out of the 4200 stocks I scan each day, odds favor another decent one around the corner.
While you may not have cashed out yesterday, (because you too may have your own laugh when you see me clear the deck) raising stops is just fine as well. Whether you cut shares, raise stops or outright sell, make sure you never lose that incredible flexibility of the individual trader who always has the opportunity to dive right back in where he left off.
The market is yawning this morning, Gold is getting smashed and I will be taking a day off. It’s been nice to be back in the trading turret again and I’m glad you’ve joined me once again on the FlexFolio ride.
The FlexFolio is pushing 10% since our July restart. Without accepting much risk at all, and zero draw down, I’ll take it.
Have a great day!Read More