During the trading day Friday, I tweeted the following:
EVOL is likely a stock that I will continue being wrong on. Well, perhaps I'm being too hard on myself. I originally discovered the opportunity when it was in the $6 range, publishing a research report based on what I gained from studying the opportunity.
I never got the position sizing correct and my timing on the addition a couple months back wasn't necessarily inspired work. What I mean by continue being wrong with respect to the stock is that I wouldn't at all be surprised to see the stock move up from here. Perhaps substantially so.
Here is the bottom line for me and it may just seem silly to you: If I'm not 100% comfortable in a position then I will move capital into positions that I am 100% comfortable with. Positions that I can wrap my head around completely, without any doubt whatsoever as to the clarity of my analysis. There is no reason to waste energy on positions that an investor doesn't understand. Diversification is the poorest excuse possible to wrap oneself into the mummified state that is a vast portfolio of ill suited opportunities that an investor fails to understand completely and totally.
With that said, the current portfolios are spread across four positions at 90% invested of total capital. Those positions are: WMIH, CIDM, BFCF and KCG. All of these are companies that I get, both on a technical and fundamental basis.
In going over my results for 2013 I had a total of 5 losing trades for the year, not counting trades in ETFs. That is against 9 winning trades for the year. These results are for both realized and unrealized gains. The average loss was 9.45%. The average winner has been 63.74%. Again, this is for both realized and unrealized gains, meaning stocks like WMIH, which I have been holding for 18 months now are included in the total.
The largest realized/unrealized loss for the year was a near 18% loss in PXLW taken in January. This was a position I initiated in 2012.
The largest realized/unrealized gain for the year is in shares of WMIH which are up 223% this year and 440% since initiating the position in July 2012.
I'll have some more numbers in my year end performance summary next weekend.
It has been a kind market. Don't confuse that kindness for any level of genius or you will find yourself on the opposite end of a poisoned spear to the gut.
