No open positions in LM portfolio
Once again the portfolio is at 100% cash. The last position (LM045) was sold on Tuesday 27th September 2022.
I had previously said that I would give the position a bit of rope with which to hang itself and it would be allowed to hit the 20% stop loss.
We almost got there. Almost.
I've not been checking on my portfolio regularly over the last couple of months because (a) I knew there was only one company and it wasn't going to plunge overnight and (b) there wasn't/isn't anything to buy at the moment.
By chance I was perusing the 52 week lows on investing.com and I saw that United Utilities (UU.) was on the list. This was the share that I held and on logging into my brokerage account I saw it was almost at a 20% loss so I closed immediately.
Yes, I should have stuck to my 200 day SMA rules. Had I done that I would've been out at a very small loss.
Nevertheless we sit here with 3 months of the year to go and the markets are not looking strong in the slightest.
The FTSE 250 is at 17,000 which means it is currently down 27% year to date - that's twenty seven percent!
It's not just the UK, the S&P 500 is down nearly 25% since January.
So I can comfort myself with the fact that the LM portfolio is only down 9% in 2022 whilst the markets in general have lost 3 times that much.
This week I have been watching some old investing seminars as it's always a good idea to remind yourself of the basics.
For me, it's mostly to remind me of the rules that I am supposed to be following. This UU. loss is irritating not because I have lost money - I'm always going to have trades and investments that lose money. If I wanted a guaranteed return I'd have to go and put my money in a cash LISA, earning next to nothing.
The UU. loss is more grating because I KNEW I should've closed at around 1060p when my self-imposed rules told me to. Instead I held on and finally got out at 900p. That's basically gambling, recklessly throwing away money.
It has to stop.
Book review:
Earlier this week I bought and read a book which was somewhat investing-related. You can read the review I did here:
A Millionaire's Diary by Jessica Jones
Betting System Update:
For the near future I will be concentrating on the two betting systems I mentioned in the last update. These both have a positive expected value (EV) which means over the long term I WILL make money by following them.
System 1 (the Each Way horse racing system) finished on Saturday at an all-time high and is WELL UP on the starting balance. In fact, I can now safely remove all of the money I initially paid in and continue with a very healthy balance that is pure profit. It is made up of 100% of money I have taken from the bookmakers and none of my own money, which is a fabulous feeling.
For now I will leave all of the cash in the system to grow.
My plans for System 2 are to grow it further and then add more capital to it, taking some of the profit from System 1 and transferring it into this second system's bank.
I am up 121% since the close of play on Sunday night and waiting for the bank to increase before I start to use a larger stake. No rush with this, there is football on pretty much everyday so there are always selections coming up in the software.
After more than 1600 bets it is looking like a long-term successful system so the plan is to cautiously increase the bet amount as the balance allows.
The portfolio:
As for the LISA portfolio we will continue to wait. I was curious to see how the shares that I have previously sold have done since I got rid of them.
You may remember that my largest loss was in Taylor Wimpey (TW., LM022) - the damage in that one trade was nearly 50% of the initial stake. I had no chance to get out any earlier as this came at the beginning of the great Coronavirus panic of March 2020 when the markets took a huge dive.
Now TW. did come back. I sold on the 16th March 2020 at a price of 124p. Later that year it went as low as 106p but then came back so that by March 2021 Taylor Wimpey was at around 180p. I'd bought at 218p so had I held I still would've been holding a loss.
This week it was down at 88p and with home builders all seemingly under pressure it could fall further.
Some people in my position would've bought more TW. back in March 2020 so that they could "average down".
That's not my style.
If a share doesn't behave it is sold and when it comes to Taylor Wimpey I definitely feel I did the right thing by dumping it as soon as I got a signal. Yes, I would've lost less by holding it for a year and then selling but the stress involved in seeing it drop closer to 100p would've been sky-high. Not for me, I like a stress-free life!
I can now watch it plunge (if it does) with complete detachment but also a clear head. If it shows strength then I could always buy it again in the hope of catching a recovery.
Of course, there would definitely be a set stop-loss in place. No share is ever too low that it can't go lower.