SIRI Intraday Thread: Thursday April 16

[Newman]

Whynot: A lot of the talk you hear about selling is from people that are looking to TRADE the stock. It all about selling on the spikes and buying on the retracements. It is risky, for sure, but it can also net you some nifty cash.

Lets say you are playing with 10k shares. Each penny the SP moves is worth $100 to you. Today, the SP was up 3 cents, or $300. What people are asking is what is the right point to sell to lock in gains, and then rebuy lower.

I do NOT think 42 is that place... I think we see 48 tomorrow, and THEN retrace back down to 44-45 ish. Remember those 3 pennies? If I sell at 48 and then rebuy at 45, I just locked in $300 (minus "round trip" commission of about $10 each way, net gain of $280). I could either pocket that $300, or use it to buy another 600 shares of SIRI or any other trading stock out there.

I want to add in a disclaimer though: I would NOT recommend doing this with your entire position. There is never any garauntee that the SP will retrace where you want it to, and you don't want to get caught chasing the stock upwards. Only use a small portion of your position to play with. Always maintain a CORE position, and never sell that until it reaches your goal that you made when you bought the stock.... You did have a goal when you bought it, didn't you?

[MLSiri]

Thanks for the chart and the explanations, Relmor! ...
I'm taking your advise (and the other esteemed members of SA/SB/SW) to sell a portion of my core (10-20%) at around .51 and then rebuying on the predictable retraction to accumulate more shares for the upward push. As you say: wash, rinse, repeat!

Whynot: A lot of the talk you hear about selling is from people that are looking to TRADE the stock. It all about selling on the spikes and buying on the retracements. It is risky, for sure, but it can also net you some nifty cash...

I want to add in a disclaimer though: I would NOT recommend doing this with your entire position. There is never any garauntee that the SP will retrace where you want it to, and you don't want to get caught chasing the stock upwards. Only use a small portion of your position to play with. Always maintain a CORE position, and never sell that until it reaches your goal that you made when you bought the stock.... You did have a goal when you bought it, didn't you?

Exactly, Newman! It all goes back to the "plan" we had when initiating the trade. This "wash, rinse, and repeat" tactic is not intended for an entire SIRI portfolio (unless you have more balls than the NBA draft lottery), but rather to "trade" a smaller SIRI "position" (i.e., block(s) or lot(s)) and gain shares by playing the hand we have been delt by the MMs (advance, retrace, consolidate, advance...). Only the duration between these events will vary. You must DYODD, and assess your personal risk tolerance and ability to withstand the joy of massive profits, or the anguish of reduced profits, or even losses.

As suggested many times here before, always maintain a "core" position (50% or more) of your total SIRI holdings (portfolio) that you want to ride to the top, while using a smaller, or new position to play the predictable give and take that history has revealed will be the future of this or any stock. If you reinvest the total amount of your sale at the predictable lower SP, then you will accumulate more shares than you originally started with (the magic of compound investing!). At some point, you may even recoup your initial investment and continue to play the stock with only house money.

IMMHO, it is unrealistic to believe there will be a sudden and uniterrupted meteoric rise (i.e., from .40 to 1.00) without some downward or horizontal movement in between. Hey, I'd take a 150% profit in one day regardless of the number of shares I owned. Is this realistic or probable? Probably not.

So Whynot - take what the MMs give and enhance your SIRI portfolio - it's the gift that keeps on giving.