Robert Freedland

Why I Sold National Oilwell Varco and Bought WMS Industries

Brother Maynard,

I suspect the VIX demonstrates the severe volatility in the market with multi-hundred point swings on a daily basis.

So far I haven't done that badly with WMS and NOV was hit pretty hard today closing at $29.92, down 9.11%. (still way above my own sale point.)

WMS closed at $24.81, down $1.70 or 6.41% so nothing to write about there either. But this is also well above my own purchase of $20.04.

So overall it was a wash. Lucky enough so far I guess.

But your comments are noted and I appreciate your insight on the VIX and avoiding getting whipsawed in this volatile trading environment.

Bob

Why I Sold National Oilwell Varco and Bought WMS Industries

There have been a lot of great comments about the value of National Oilwell Varco (NOV). I do not disagree with them.

Unfortunately, my decision to sell NOV was based on my own idiosyncratic strategy of limiting losses and moving to other investments when such losses develop. It was not an assessment that there was no value in Varco, nor was it a judgment on the relative worthiness of WMS vis a vis Varco. It was simply my own approach, that I am continually working on refining, of trying to avoid large losses in any investment, maintain a minimum of positions at all times, and replace companies that incur losses when at or below that minimum.

I also do not become emotionally involved with any holding, I do not try to think real hard about the story behind any stock beyond the fundamentals and my own limited ability to predict future trends, and sell stocks based on price movements rather than anything else.

I work hard at this entire process. I am trying to build an investment 'machine' of some type, that will assist me in knowing when to buy, how much to buy, when to sell, and when to 'sit on my hands'. In the same fashion, I am trying to develop a portfolio strategy that will automatically be shifting me into and out of equities depending on the market action as reflected in the action of my own holdings.

This is a tall order for an amateur like me. So the microscopic viewing of this trade may seem irrational or even difficult to comprehend. Like a part of a watch seen outside of the movement, the entire process may be hard to assess without understanding the rest of the story, like Paul Harvey would say.

I hope you all take the time to visit my blog, read some of my entries, and see if it makes sense. I am not sure that this process will work, but I have an ambitious goal to develop something of significance in my work that I do.

Why I Sold National Oilwell Varco and Bought WMS Industries

SevenSisters,

Thank you for your thoughts. Gambling is also cyclical but a stock like NOV travels with the price of oil. I do like NOV's numbers though, and with the great results from XOM today, the stock has popped higher.

My strategy involves minimizing losses, taking small short-term gains, and trying to shift into and out of equities depending on the performance of my underlying holdings. The entries on Seeking Alpha are informative but you might want to visit my blog over at Stock Picks Bob's Advice for more information.

Again, thank you for taking the time to write and think about what I have written.

Why I Sold National Oilwell Varco and Bought WMS Industries

retepog,

I like National Oilwell Varco (NOV). If you are willing to ride it down as well as up along with the price of oil, it may be a winner. I sold because it exceeded my own loss tolerance. What are your thoughts?

Getting Clobbered: Why I Changed My Investment Rules

There are many good strategies for buying stocks. I appreciate some of the above comments. NOV is also a favorite of mine that I have examined in the past and have kept it as an "investable" pick.

When I was given the opportunity to buy shares through my own idiosyncratic system, NOV was where I moved. Clearly, tight stops under stocks doesn't work in this sort of market. That is the point of my entry and my 'thinking out loud'.

However, I don't think there is anything wrong with buying stocks moving higher on strong momentum.

As you will note, NOV made a strong move higher today, getting me out of any sell-zone in any case and letting me hand on for another day at least. I also purchased some Imperial Oil (IMO) today, adding to my energy holdings in my account. (Along with NOV and GHM).