From the Trading Desk

Past Big Winner 2012: POWR December 11, 2012

POWR was what I would consider a perfect acting stock outside of the fact that it did not move up over 100% before giving its first sell signal that allows to hold the majority of the position for truly outstanding gains. That being said, this stock climbed higher better than almost any other holding throughout 2012 and 2013. The biggest problem with this long signal is that it wasn’t a large core holding in our own portfolios. 2012 was shaping up similar to 2011 for myself and as the year was running out, despite having some big winners on my hands, my portfolio was down on the year again. This was due to the fact that our win loss ratio went from 65% to below 50% and our gains to losses went from 3.5 to 1 to 1.5 to 1. This was due to the QE manipulated choppy market environment that hit all trend followers hard. Due to all of the above, this position was only 1% of my entire portfolio. Way too small to account for anything meaningful (especially with no additional entry signals) in my accounts. However, the lesson is here to be learned so that next time a stock sets up and acts like this you can have 20% of your portfolio in it. We will see this pattern again. From the first purchase to the top POWR gained 300% and from our first purchase to the final sell POWR returned 218%. In any other normal market this would have been a nice score for our portfolio. Unfortunately for me, by the time 2012 was winding down I was still trading scared. The good news is that trading-scared methodology was finally eliminated in 2013 and we have been slowly getting back to normal. This market still isn’t there yet as of this writing but its a lot closer than it was just a couple of years ago.












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