Returns 2003

returns 2003

Trader Paul versus the indexesAll sing: Here comes Santa Claus, here comes Santa Claus, ... Indeed, the rally grew the value of my portfolio another 8% during December, bringing the growth for the year to 192%.

Put another way, I came this close to tripling the value. Of course, this was a banner year all around, and any damn fool could have made money in the market. Exhibit A: Trader Paul. I have to say that this was far, far better than I ever expected when I set out months ago to figure out this stock market thing.

Thanks to a Thanksgiving rally, the value of my portfolio managed to grow another 5% during November, bringing the year-to-date growth to almost 170%. Some stocks in my portfolio that were imitating turkeys did an about-face at the end of the month; the unrealized gains account for the growth in value.

I took nice profits in AZPN (twice) and VTIV.

After a slow start, the markets recovered nicely to end October on a high note. Accordingly, September's decline in year to date return on investment was overcome. During October I took more profits as I could, more than in any other month so far. Unfortunately, this has left the portfolio filled with mostly stocks that had anemic performance during the month.

Now that most companies have reported earnings, there should be a brief recess in the Expectations game. Lots of encouraging economic news — if it is sustained — holds promise of a profitable fourth quarter for my investments. Knock wood.

It was the best of months, it was the worst of months (well, almost; see February). During September I took more profits than in any other month this year. But my remaining stocks got caught in the entirely predictable September swoon, so the net effect was a decline in the overall value of my trading portfolio.

Ouch! I knew the market would "correct." It always does. The historical pattern is unmistakable. But even knowing that, I kept positions in about twenty stocks. The downward move was swift — too swift to extricate myself, and I am left holding the bag, as it were, a sadly depleted bag. I have to hope that history repeats itself in the remaining months of the year as well!

yearly cycle of stock prices
Yearly cycle of stock prices showing well-known September swoon Dow and Nasdaq indexes for September 2003
Dow Jones Industrial Average and Nasdaq composite indexes for September 2003

My trading account grew by 13% during August, bringing the year to date return up to 124%. That is, the value has more than doubled since the end of last year.

Correction. I discovered that when I set up my spreadsheet I made a mistake in the formula that calculates the year-to-date return. Accordingly I have restated the returns below for July.

Shades of Enron and Worldcom!

About half my profits came from just two stocks, SWBD and GSIC. I did little better than breakeven on DOCC.

July was a pretty good month. My trading account grew by 15% 17% over the previous month, bringing the year to date return up to an even 50% 99%, just a whisker short of double.

I took nice profits on CNET, LSI, SONS, and EFDS.

I got caught unawares by a sudden drop in the price of KNDL, wiping out most of the gains. There weren't many buyers, and I was not able to sell my entire position. I decided to keep the remaining shares for a while to see what would happen when earnings were reported. This probably wasn't wise; the stock has continued to fall, and I'm now down 16% on the remaining shares.

June was not a kind month, with only a trivial increase in the value of my portfolio compared to the end of May.

  • I left a lot of cash on the table with some stocks, for example SCSS and SCUR. Greed won out over logic, and I held on too long after prices had peaked.
  • There were days of extreme volatility and I got stuck with certain stocks when my stop-limit order wouldn't execute because the price dropped too quickly under my limit. I'm still holding these, inasmuch as they are trading sideways and may (I hope) recover after a period of consolidation.
  • One stock, CNQR, sold prematurely when a sharp, unexpected drop activated my stop-market order and gave a couple of traders a chance to buy CNQR at a very good price. (At this point, CNQR is still trading sideways at about $10, which is where it was before it sold.)