[quote author="blackvault_cm" date=1227076038][quote author="WINEX" date=1227040413][quote author="blackvault_cm" date=1227007861][quote author="WINEX" date=1227004960][quote author="blackvault_cm" date=1226997845]I did buy AA, C and BBY at the end of today to join CSCO and XOM.
Slowly shifting portfolio towards long-term with covered calls and S&P puts for protection.
Oh and AAPL.</blockquote>
It's none of my business, but is the AA intended to be a long term holding?</blockquote>
All of them are. I'm still bearish, but slowly accumulating various positions and writing calls for steady income. If any of them move 25% upwards they are out of my portfolio...So if AA moves up 25% tomorrow? I won't be long anymore on it.
Plus the these long holdings make up about 20% of my portfolio.
DOW still goes to 7K imo.
I'm suprised you asked if AA is long and not C. C will probably never move back to the same level it was before.</blockquote>
The reason I asked about AA specifically is because I find that stock interesting for a long term position at these levels. I'm not really interested in C at this point. Also, just for clarification, I was interested if it was intended as a long term holding (as opposed to a day trade or swing trade)
Also, is that 25% goal truly independent of time? I can understand taking profit if it moved up 25% tomorrow, but what if it was relatively flat for the next 5 years, then started soaring? Also, do you set downside targets? i.e. if it falls 10% you are out of there?
More me, trades are different from investments, and I never let one become the other. (i.e a trade become an investment, or an investment become a trade)
If I am making a trade, then I set profit goals, loss limits, and time limits for the trade to earn it's keep or be gone.
But an investment is a different animal. For investments, I try to understand the value of a company and when the price exceeds my estimate of value by a comfortable margin, I move on.</blockquote>
AA has great value imo. However, I don't think it goes to 40-50 a share that it was prior. You do have to remember we had a commodity bubble. However AA going to 20 a share isn't out of reach. When i say I'd dump if it jumps 25% in one day I mean just that. Because the likelyhood of it pulling back some of that gain and allowing me to rebuy is pretty good. I never pass up a 25% interest gain in one day. Like I said though, I'm mainly looking for steady growth and a position where I can write calls. If I can write calls slightly out of money and collect that premium and get a small appreciation on the stock I'm good.
As far as it being relatively flat for next 5 years...that would be ok with me. I can get about 6-7% premium each month with covered calls. It would be a dream come true if it stayed flat for 5 years. Thats a guaranteed 70-90% return a year. Its important to write calls or even buy puts when you expect things get rocky to capture additional gains.
I don't sell a company ever on a 10% downturn or whatever the number. I do my research and If I like the company I'll stick with it unless research tells me otherwise. So if a company fell 10% or more on a regular trading day or two...I'll simply buy more. I don't let market movements dictate my position. At the same time the stock could be soaring and if I found something I didn't like...I'll dump. I won't take risk. So I base my buys/sells on my evaluation of their business vs what the market dictates.
I also happen to be a big contrarian when I trade. I usually will look for moments where I'll do opposite of what others do. When DOW shot up to 9200 and kept going up...I shorted...right now people are selling...I started buying. Many times I'm wrong, but I've been right more times than wrong otherwise I wouldn't do what I do.</blockquote>
Thanks. With AA, I believe a lot of what it gets to depends on the timeframe. I think that people who buy now will be very happy 10 years from now if they are still holding.
I guess we are on our way to 7k. 