If stocks were in a prolonged downtrend, being able to profit anyway, would be extremely valuable. We are just buying or selling stocks at open on Wednesday and selling or buying them back at close on the next Tuesday. This is especially important if trading on a time basis – without using stop-loss/ profit target levels. Hence the need for proper money management and a relatively diversified stock portfolio. There are risks that couldn’t be avoided in trading. Hence that relatively big drawdown of our portfolio. The Energy sector has been the strongest in the previous month, but last week there have been significant declines in oil stocks.
Our long stock picks have lost 6.12% and short stock picks have resulted in a loss of 2.32%. Stock picks were relatively much weaker than the broad stock market’s performance last week. In the same period of time our five long and five short stock picks have lost 4.22%. The S&P 500 has gained 0.88% between January 20 open and January 26 close.
The S&P 500 index reached new record high of 3,870.90 yesterday, as investors awaited big-tech quarterly earnings releases. In the last five trading days (January 20 – January 26) the broad stock market has extended its long-term uptrend.