I continue to work my strategy even in the face of this volatile market that was screaming higher at the close. The Dow closed at 9,065.12, up 889.35, and the Nasdaq moved up 143.57 to close at 1,649.47. The S&P also participated, moving up 91.59 to close at 940.51. I cannot guess when the market shall be moving higher or correcting sharply.
All of the stocks I own I consider "great companies". But they do not always perform as I would like (move higher). I have changed my strategy when down to the minimum of 5 positions, as I have written about previously. I continue to try to have a minimum of 5 holdings, but I can tolerate a 16% loss, and after they hit that loss and are sold, I replace them with a smaller position. I actually now determine the average size of my remaining holdings and buy a new position at 1/2 that size as measured by the cost of the purchase---not the number of shares.
Earlier today, before the last hour climb in the Dow, I sold my 210 shares of National Oilwell Varco (NOV) at $23.55/share. This stock has been travelling lower in synch with the price of oil. And no matter how pretty the numbers on this company, the price has been relentlessly declining since my purchase. These shares were purchased literally just days ago on 10/17/08, at a cost of $28.83/share. Thus I had a loss of $(5.28) or (18.3)% since purchase.
