While this fertilizer name has had quite a run, I don't want to get too greedy, and I've simply cut back this position as we break over $100. I've cut it back to 1.3% of the fund and will let the rest run if it is so inclined. I still find CF Industries (CF) very cheap on 2008 estimates.
I will add back to this (former #1) position on any sizeable pullbacks....
I will add back to this (former #1) position on any sizeable pullbacks....
4 comments:
Quite a run? What about MOS? :D
Well Im confused quite why you are cutting back it because macd just bounced nicely two days ago. OnBalanceVolume just got outside the tunnel. TSI turned positive. Price right now is right sitting in my trend line.
Don't see any sight why it shouldn't go higher.
But I may be wrong..
Hi Mait,
Yes MOS has quite a run too.
For CF, its as simple as all the cliches I always say... sell when you can, not when forced to. All those TA things you mentioned sound fancy but well over my head - I only use the most simplistic TA, and it helps more for when to buy, not when to sell. This is more of a call on the market - last time the market corrects, nothing is spared, no matter what the TA is. Remember that 1 day back in November when these stocks lose 15% of their value ? That can happen at any time.
I never catch the very top nor bottom - I just want to consistently catch the middle of the move. CF has gone from 80 to 100+ in 3 weeks. That is 25% .,. most people would like that for 1 year. Does this make me miss some stocks that just go up, and up, and up, and up? Yes, but those are the minority of stocks. Most have corrections along the way. So I am trading for the majority, not the minority.
Also I dont like the market overall, so I am taking profits when offered. I am doing the same in MOS/POT but in smaller scale as the 'potash' component in those 2 names is very valuable. But as a child of 2001/2002, I take profits when offered. If the stock continues to run I still have some left in the game. If it corrects, I buy back. I don't see how I lose.
Yes I agree with you. I haven't seen 2001/2002 and I have to learn my mistakse someday. And I like your TA because it's simpel. Sometimes I think mine is too over noisy but it worked best for me so far.
It bulled back 15% nicely that november day. I remember that very clearly because I owned calls what I sold after that 3 days later with minus in my profit:) We had little bullback again after fed but I think we still need a major bullback in markets to see CF to fall near 50 day moving average. Investors saw how fast it can go back up again when market recovers and don't want to lose that move again.
Im net short right now overall and like you I dont see that important SPY level 1520 again in near future because longs dont have much excuses why It should go up from here again.
These are my thoughts. And thank you for your replay! Reading every day your blog:)
Hi Mait,
2002 was an unusual year (very bad). But newer investors are only used to 'good times' in the market. There are many years the market used to go down. Actually since 2001 the market is flat (S&P). Since 2002 when it dipped a lot, it is up. But there is no pre-condition that says the market must go up. Over time it goes up, but there are years it goes up 35% and others it goes down 25%. If you look in the 1970s the market was pretty dismal. Anyhow I always take profits along the way - if not I would be down severely on BCSI or CROX. I took profits as they screamed higher and then when they imploded, I was at least near break even. Even at this low price I am about even on Blue Coat and slightly positive on Crocs overall. Someone who just buy and holds would be down. With that said, there are times you find a great stock and you want to buy and hold (mostly), but when you buy you do not know which stocks will be the great stocks and which will be the ones to crater at some point. So I treat them all the same. And the ones that continue up, well at least I have some exposure if it just goes up, up, up, and up.
But just keep in mind there is no destiny that says the stock market must be up 5-15% year after year after year. When I see these short term moves up, in a market I do not like overall, I will take some profit. It won't always work - sometimes the stocks will continue upward with no pause. If so, that's still fine. I just make 'less profit'. Still a profit!
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