Being the Sirius XM Radio Inc. (SIRI) bull I am (yes I still am), I have endured many ups and downs going back as far as 2009. My fellow brethren have been through the same yo-yos, I even wrote a few articles on them and how to make money on the swings.
Yesterday, I liquidated the remaining position I had in Sirius. Now I only hold some 2013 options for the stock. It has been a wild ride over the 5-plus years I have owned the stock, and I have mixed feelings about my decision yesterday. Was I too hasty? Did I not give it time to see where this latest run would take us? Have I been listening to too many authors here who like to bash the stock almost as much as I like to talk about it's prospects?
The fact is I do not believe in ANY of the above. I had set a $2.12 price yesterday and if ALL of my shares were bought, then so be it (price actually hit $2.13 so the miracle sale happened). When I received word of the trade, I had a moment of shock, but after some thought I realized the decision was a rational one, for several reasons.
Show me the Money: I am in this game to make money. By watching Sirius climb above my entry point, I was able to secure another double-digit profit. We cannot fall in love with any stock, and need to keep our eyes on the ball. Although there is still upside in this stock, I feel in the short term taking the money on a stock that is heavily volatile and is on a 10% climb over the last week was the prudent move. If the stock does move, I still own the options on it for it to strike $2.50 by Jan 13 so I do have some coverage if the stock skyrockets.
Buy In/Buy Out: I can always buy back in, though admittedly I may be kicking myself if this stock does continue on its magic carpet ride. However, as I mentioned in an earlier article, buying Liberty (LMCA) directly I believe (once they buy out Sirius) will still allow me to partake in having Sirius, it will just be flying under a different flag. Plus, Liberty to me is a much more stable investment at this point compared to Sirius. Not a better one, just more stable.
Other money-makers: As much as I will get slammed for this, frankly there are other ways to make money in the market. I have initiated a position in Dell (DELL), and already am up almost double digits. I also am now looking at SPDR S&P 500 Trust ETF (SPY) and Apple (AAPL) to have potential short-term pullbacks, which could provide put opportunities. There are many ways to slice bread.
In concluding I still like the model and the potential of Sirius, however for me it was time to move on (at least for now). I will still continue to write about the stock on occasion, and as mentioned do believe in it's future. But as I have said on many occasions before, it is your money so you need to be the one to analyze all the opinions, the financials, and eventually go with your gut. If you do your homework properly, you will be correct more often than not.
Additional disclosure: I have initiated a Put position in SPY, and may enter into put positions for AAPL.