I’m going to call this Simulation 1, and am asking my robot friend Sim1 to implement my sells and buys. Sim1 will sell if we hit a 10% stop loss below the purchase price or if the price goes below the 50dma. So let’s kick things off.
Below is what Sim1 bought today, and the stop loss prices he set.
Ticker
Name
Amount purch
Buy price
Shares purch
Stop price
ASPN
Aspen Aerogels Inc
$ 9,972
$26.52
376
$23.87
FOUR
Shift4 Payments Inc
$ 10,017
$76.47
131
$68.82
MELI
MercadoLibre Inc
$ 10,050
$2,009.93
5
$1,808.94
META
Meta Platforms Inc
$ 9,808
$518.23
19
$466.41
MO
Altria Group Inc
$ 9,975
$54.78
182
$49.30
NU
Nu Holdings Ltd
$ 10,004
$14.19
705
$12.77
ONON
On Holding AG
$ 9,978
$45.12
221
$40.61
TTD
Trade Desk Inc
$ 10,009
$103.08
97
$92.77
UBER
Uber Technologies Inc
$ 10,007
$72.15
139
$64.94
ZETA
Zeta Global Holdings Corp
$ 9,988
$25.61
390
$23.05
Cash
$ 193
Total
$ 100,000
We’ll update this simulation to report any buys and sells, and keep track of the returns.
We will buy if there is cash available following a sell, market conditions are right, and we find another suitable stock in a Stage 2 uptrend. Market conditions are right if we can find many such Stage 2 stocks. For more on Stage 2, see Trading With Stage Analysis
I’ll be interested to see how the stops work out. Years ago I spent a lot of time trying to find a mechanical way to set a stop loss. Never found anything that worked well. Mostly reduced gains.
Yes, I’m sure I’ll be leaving money on the table with the stop losses. That’s OK. With swing trading, I won’t capture the exact bottoms, and I won’t get out at the exact top. That’s OK, too. This style of trading was made popular by market wizards like Stan Weinstein, William O’Nell and Mark Minervini, among others. You can read their books and see if this style is for you for a part of your portfolio. Don’t bet the house with this.
Sim1 (the robot) woke me up to let me know that we were stopped out of ASPN on Friday. He never sleeps, whereas, as a retiree, I sleep in every day . He also prepared an update on the current holdings in the simulation. (He’s so thorough!)
Well, I started this simulation early last week, which turned out to be one of the worst weeks for the market this year. Great timing on my part, huh? However, the market staged a comeback rally this week, and I now see that we’re UP 2.8% since our start date (vs. +2.0% for the S&P 500). Winners so far include FOUR and ONON, both up about 8%. The only loser is MO, down 3%.
I asked Sim1 how he felt about having beaten the market so far. Unfortunately, he’s a robot, so he just gave me a long blank stare He has no emotions, whatsoever. HAGW!
Trade alert. SIm1 is selling MO (it’s been weak and touched 50dma) and buying back shares of ASPN with the proceeds. ASPN is again crossing above its 50dma. Sim1 is currently up 3.4% since inception on September 5.
Breaking: the Fed just cut rates by 50 basis points. Our stocks are reacting well to the news so far. That being said, the last half of September has seasonally not been great for markets. We continue to have our stops in place.
. He also prepared an update on the current holdings in the simulation. (He’s so thorough!)