Robert Freedland

Why I Sold My Shares of Microsoft and WMS Industries

Photo,

It isn't about what makes me happy, although I am glad you are concerned about my good humor. I also appreciate the 'bigger picture' on Microsoft. I do not think Microsoft is going to go bankrupt or disappear from the software scene. I do believe the stock represents great value and shall likely reward investors who are patient and can see far into the future. It is just that my own idionsyncratic trading system requires me to carefully add positions and manage those holdings just as closely. My Microsoft purchase was just for a trade because just like you, I believe that the value after the earnings announcement, was quite compelling and that a rally in the share price would likely result. I simply chose to take that money off the table without my sale being a condemnation of the Microsoft stock which as you will note continued to move even a little higher today.

Why I Sold My Shares of Microsoft and WMS Industries

I am delighted at the enthusiastic response to my trade.

Photo, I am sorry that you believe me to be a moron. I purchased Microsoft in an 'outsized' position as a trade. I otherwise have a very 'disciplined' trading strategy that determines my own purchases and sales of stocks in a defined fashion. Microsoft appeared overdone to say the least on the downside. With the stock moving up a point, I sold that position and saved my equity for another day. My own sale was not based on my view of Windows 7, Apple Computer, the Stimulus Plan, or the price of Oil. It was simply a trade.

Fred, your comment about my $34,000 trading account is amusing. As it is said in Fiddler on the Roof, 'when you are rich, they really think you know!' Perhaps you would prefer to take your investment advice from John Thain or Bernie Madoff? I have other investments that I employ managers to monitor. I write this blog about my 'trading account' to share with readers my own experience. I do not believe that the size of one's portfolio is necessarily related to the wisdom being imparted. I am sorry if I have wasted your own time with such a trivial amount.

351563....fool? It is never foolish to take a profit. I will leave it at that.

Jake, you make a good point. I would have hoped for more on the Microsoft trade. I am not comfortable with this market and am concerned about my overall performance--percentag... wise--as I look to stay ahead of the S&P. I post every single trade I make on my blog. Wise or foolish. The 600,000+ in new unemployment numbers this week should give everyone a pause. The Stimulus plan may not be stimulative, the TARP funds may be inadequate to bail out the banks, and Afghanistan, Gaza, and North Korea may implode.

Thus, with all of my anxiety, it is likely we are near a bottom and climbing the proverbial 'wall of worry'. I know I am not comfortable about things.

Thus I revert to my minimum of 5 positions, and wait for my own signals to be adding a smaller positions as #6 or replacing one of my five as needed.

Thank you for understanding.

End of Year Portfolio Performance Review

I think that is my typo. These are stocks as of December 31, 2008. I am probably not old enough to have these kind of 'senior moments'....:). Thanks for the correction. Have a Happy New Year!

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?