So why did I invest in NAO and RDS.B knowing they have a connection to oil? With NAO it has a strong high dividend, I think it is safe. A dip in the share price can be made up with the dividend over time and when oil does rise I think NAO will benefit from that but NAO is more into services in the oil business. RDS.B is more of a restructuring story and the oil price doesn't hurt the company as much. The dividend is high and it was a great time to DCA the position. The power of dollar cost averaging! I made the initial purchase of RDS.B at $86.80 and recently bought at $69.34 to average out at $77.12. See my Stocktwits account for when I post purchases and sells live. The way to let DCA work for you is to be patient with a position you like and then buy after a bigger fall of 10 to 20 percent. Some people buy after a small drop and don't have enough bullets to take advantage of the correction. You must understand your company! RDS.B is an oil stock and we know oil is a volatile market. The reason I don't use stop losses is I understand the swings in price and am a long term shareholder. I prefer to DCA and trade around a core position. You must understand your company and how it moves to the market conditions.
My next YouTube video and blog entry will be one of the "themes" I invest in.
Stocksnowball Portfolio
|
|||||||||||
| Starting Value $20,000 on June 27,2014 | |||||||||||
| Company | 11/1/14 Close | Buy Price | Shares | Market Value | Cost Basis | Gain/Loss | Gain % | Weight of Portfolio | Commisssion | Dividends (drip) and Int. | Annualized IRR |
| RDS-B |
$74.67
|
$77.12
|
27.1390
|
$2,026.47
|
$2,106.88
|
-$80.41
|
(3.82%)
|
10.07%
|
$13.90
|
$0.94
|
-5.84%
|
| TGT |
$61.82
|
$58.72
|
17.1452
|
$1,059.92
|
$1,013.69
|
$46.23
|
4.56%
|
5.27%
|
$6.95
|
$0.52
|
5.48%
|
| AG |
$5.13
|
$9.58
|
41.0000
|
$210.33
|
$399.73
|
-$189.40
|
(47.38%)
|
1.04%
|
$6.95
|
-47.38%
|
|
| MCD |
$93.73
|
$94.05
|
21.1813
|
$1,985.32
|
$1,999.01
|
-$13.69
|
(0.68%)
|
9.86%
|
$6.95
|
$0.81
|
0.17%
|
| ADDYY |
$36.31
|
$37.61
|
27.0000
|
$980.37
|
$1,022.42
|
-$42.05
|
(4.11%)
|
4.87%
|
$6.95
|
-4.13%
|
|
| BWLD |
$149.28
|
$134.55
|
15.0000
|
$2,239.20
|
$2,032.20
|
$207.00
|
10.19%
|
11.12%
|
$13.90
|
16.36%
|
|
| IEP |
$105.58
|
$104.41
|
10.0000
|
$1,055.80
|
$1,051.05
|
$4.75
|
0.45%
|
5.25%
|
$6.95
|
0.45%
|
|
| DIS |
$91.38
|
$86.87
|
12.0000
|
$1,096.56
|
$1,049.39
|
$47.17
|
4.49%
|
5.45%
|
$6.95
|
4.49%
|
|
| NAO |
$16.00
|
$14.58
|
75.0000
|
$1,200.00
|
$1,100.45
|
$99.55
|
9.05%
|
5.96%
|
$6.95
|
9.05%
|
|
| Subtotal |
$11,853.97
|
$11,774.82
|
$79.15
|
0.67%
|
$37.13
|
2.01%
|
|||||
| Cash (USD) |
$8,275.45
|
$8,275.45
|
Total Gain/Loss w Div |
41.11%
|
$16.59
|
0.23%
|
|||||
| Total |
$20,129.42
|
$20,050.27
|
$132.87
|
$53.72
|
0.66%
|
||||||
Transactions
|
||||||
| Date | Type | Instrument | Shares | Price | Commission | Amount |
Oct 31, 2014
|
Interest |
$3.45
|
||||
Oct 16, 2014
|
Purchase | Royal Dutch Shell plc |
15
|
$69.34
|
$6.95
|
$1,047.05
|
Oct 10, 2014
|
Purchase | Nordic American Offshore |
75
|
$14.58
|
$6.95
|
$1,100.45
|
Oct 8, 2014
|
Purchase | Walt Disney Company |
12
|
$86.87
|
$6.95
|
$1,049.39
|
Oct 8, 2014
|
Purchase | Buffalo Wild Wings Inc. |
8
|
$125.50
|
$6.95
|
$1,010.95
|
Oct, 1, 14
|
Purchase | Icahn Enterprises, L.P. |
10
|
$104.41
|
$6.95
|
$1,051.05
|
Sept 25, 2014
|
Reinvestment | Royal Dutch Shell plc |
0.1390
|
$81.14
|
$0.00
|
|
Sept 16, 2014
|
Reinvestment | McDonald’s Corp. |
0.1813
|
$93.83
|
$0.00
|
|
Sept 10, 2014
|
Reinvestment | Target Corp. |
0.1452
|
$60.88
|
$0.00
|
|
Sept 1, 2014
|
Interest |
$5.64
|
||||
Aug 21, 2014
|
Purchase | First Majestic Silver |
41
|
$9.58
|
$6.95
|
$399.73
|
Aug 20, 2014
|
Purchase | McDonald’s Corp. |
21
|
$94.05
|
$6.95
|
$1,982.00
|
Aug 7, 2014
|
Purchase | Adidas Ag |
27
|
$37.61
|
$6.95
|
$1,022.42
|
Aug 1, 2014
|
Interest |
$7.50
|
||||
Jul 30, 2014
|
Purchase | Buffalo Wild Wings Inc. |
7
|
$144.90
|
$6.95
|
$1,021.25
|
Jul 2, 2014
|
Purchase | Target Corp. |
17
|
$58.70
|
$6.95
|
$1,004.85
|
Jun 27, 2014
|
Purchase | Royal Dutch Shell plc |
12
|
$86.80
|
$6.95
|
$1,048.55
|
Jun 27, 2014
|
Deposit |
$20,000.00
|
||||
| Total |
$76.45
|
|||||
DSF,
ReplyDeleteWell written post. A stop loss can reduce the returns when it comes to long term investing. When a stock falls in price, an investor needs to do more research to find out why? Did the company have a bad earnings report? Did the company miss analysts expectations? Did a major issue happen during the quarter? Did something fundamentally change with the company?
British Petroleum's stock price fell a lot when the leak happened in the Gulf of Mexico. A stop loss would of been good to use in that case. An even better option would of been a put option, if the investor hedged his or her position. When the stock price started to rise again, an investor would of had a great opportunity to average down there position.
For short term trades, an individual can protect themselves with a stop loss. If the prices of their position gain in value, a stop loss can be used to lock in some profits. If there positions still continue to rise in value, they can adjust their stop loss to lock in even more profits.
Your position in RDS.B, you have $6.95 commission. You made to separate buys for this position, so would it not be $13.90 in total commissions.
Hey IP, Thanks for stopping by and commenting you bring up some helpful questions and a good example. Nice catch on the commissions thanks ;)
ReplyDeleteThanks for sharing your recent portfolio update with us. My general guideline for a DCA is at 5% or more decline. Since I am never fully invested I can afford to make additional purchases should a greater decline occur after my initial purchase. Of course, there are time I like to DCA at less than 5% if all other positions in my portfolio are in the black and I'm looking to deploy my monthly cash.
ReplyDeleteHi DivHut, Good points about keeping cash handy and about deploying a monthly deposit.
Delete