In a previous blog I had written about the importance of goals and using the SMART concept. It is an acronym for Specific, Measurable, Attainable, Realistic and Timely. My goal meets all those criteria, and it is right in the name of my website, twopercentgoal.com. The whole notion of a two percent goal is to make that each week so that over a year, or 52 weeks, I can double my money virtually risk free. That is my goal, that is my plan. I am not trying to swing for the fences on each pick, rather make a very modest amount on a weekly basis by swing trading that can generate very impressive annual results. When it comes to money, it does not have to be flashy, or sexy, it can be downright boring and if boring works, then that is fine with me.
We have all been at dinner parties where we hear some hot shot boasting about his story where he bought shares in XYZ company at a very modest amount and made colossal gains. First or all, if it is true, good for him, but my follow up questions are simply these: is that a onetime thing or are you doing it consistently? Were you good or lucky? What is your methodology? Be fair and balanced, what about your losses? And most importantly, how much are you making each year? You always hear about their impressive wins; you never hear about their losses.
I, on the other hand, rarely talk about the time I bought Home Depot at $50 a share and sold it at $51 three days later for a 2% gain. I do not talk about the time I bought Pfizer at $100 and got out at $102 a week later for another two percent win, and I do not boast about a stock I bought at $200 and sold it at $210 for an amazing 5% bump. These stories are not flashy; they are not sexy; they are boring, and they work.
If I try to talk about how I do it using moving averages, the relative strength index and MACD charts, a lot of people will be rolling their eyes and giving me a polite smile while trying to sound interested but thinking what kind of math geek is this guy? I am totally fine with that.
Losses happen and if anyone tells you otherwise, run screaming. But I limit my losses to 3% using stop loss orders. This is yet another boring tactic, but it helps me preserve capital for the times I will be wrong.
There are all sorts of sayings that my strategy models after. Slow and steady wins the race; remember the story of the tortoise and the hare; take care of the nickels and dimes and the dollars take care of themselves. I do not want to be a flash in the pan. I do not want the sizzle; I want the steak.
This is what we do at twopercentgoal.com. We are boring and I am totally fine with that. Sign up for the daily email that shows stocks that are poised for a two percent gain within a week. It is free for the first 30 days and then $99/month thereafter.
While the test data is overwhelmingly positive, there are risks with this type of investing and the author accepts no responsibility for any possible losses.
Cheers,
Al