What was once my pride and joy has turned into a fucking strikeout to the nth degree. I should've sold a chunk with profits, but I never envisioned this as a trade. I was married to this stock, breaking Rule #1. I sold so that I could avoid even more losses. The stock was in the mid-40s before today, then cost me a few hundred more dollars today in a slightly down market. It's Cramer's effect, telling everyone to get out, plus the fact that the Co has done little to impact the downtrend.
My portfolio gain is practically gone. But there's some relief in being out. I was once up 70% on this stock. Then I made the foolish move of doubling my position the day of earnings, and then poof! The stock cratered and I wouldn't sell, thinking it was a temporary overreaction. Today, I am forced to sell at a 30% loss. The notion of waiting it out is impossible at this point, not the way the stock keeps falling off one cliff and then another. It is impossible, at this point to fight the trend, to fend off the shorts and bears who hate this stock like no other, really.
All growth stocks trade with volatility, and the worst thing that can happen with taking big profits is that you make money. The best thing is that you can re-enter on dips. I am now at the point where I am going to trade/take profits in everything I every buy from this point. The only stocks I might leave a half-position long in are Apple and RIMM. Maybe. This was a costly lesson. My position was small, so it didn't break me, but it's still painful, a blow to my ego. That's a good thing.
Even Cramer warned people to avoid buying/trading on earnings. It was almost as if he was telling me don't buy more CROX, fool. This is another case where my personality traits work against me as an investor. I have patience. I have a high threshold of pain. I also have enough arrogance to imagine that my conclusion about a great stock will always trump anything the market brings. The truth is, it is still emotion that stunts my growth when it comes to making money in the market. Otherwise, I would be entirely mathematical about my profits and take then on every 7% (or 5% or 3%) decline. All my stubborness about holding stocks for a year to lower taxes is meaningless. CROX is a perfect example.
Just a week ago, CROX was near 75. Had I been prudent and put in a 7% stop loss, I would've stopped out at about 69.75 ... or actually, much less because the stock started tanking before the earnings report ,,, somewhere around 60, which is what I remember in the moments of the earnings report. It doesn't matter if there's major manipulation going on by the big boys. Can't fight it, can't stop it, and though I hate to admit it, Cramer is right. Better for us average Joes to get in and out quickly, before the big boys can leave us hung dry and holding the bag. Empty bags.
It wouldn't surprise me to see CROX rebound eventually, but it won't happen any time soon without positive news. Strong positive news. And though Georges Yared is probably right about CROX in his latest analysis, one thing he and a lot of bulls have never really grasped is the fact that this is the most tumultuous, volatile market perhaps ever. Long-term investors are better off staying away from streaming quotes and computers for weeks and months at a time, while traders are raking in profits on the long and short sides.
Up 70% (Crocs), up 57% (China Digital TV), up 49% (lululemon athletica), the least I could've done was take half the position off the table and bank it. Instead, my gains were minimal, losses were substantial (within small positions). We'll get our dips and our runs. Now I have to figure out what to do with my LULU and CHL.
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