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American Capital Agency Corp. Message Board

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  • saltynacho saltynacho Jan 28, 2013 2:31 AM Flag

    OT ....KMP

    Hey Doc -

    I too believe that KMP will experience a pull back........... however, I would much prefer to sit back and wait to see it (and the magnitude, as well), rather than betting on the come.
    Just my style. Too many 52 week high stocks out there right now!

    BTW - Is there something smaller than "crumbs"? :-)

    According to my math, your wager is quite small. You once stated that your trading capital is only 5% of your total capital.
    IF that's still true, then you are only betting 0.0835% (1.67 x 5) of your total capital.

    Also, you might want to take a peek @ WPZ - they just raised their quarterly distribution, and trend looks positive.

    Wishing you continued success on all your KMP adventures.

    Salty

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    • Thanks Salty,

      "You once stated that your trading capital is only 5% of your total capital.
      IF that's still true, then you are only betting 0.0835% (1.67 x 5) of your total capital."

      Yes, it is confusing. I suggest that no one ever risks more than 5% of their total capital on any one trade. That trade needs that 90+% confidence of a win or at least BE. On these "I'm not so sure" trades, I recommend 5% of your trading capital/per trade as a maximum risk. That trading capital being 20% of your total capital.

      Example. If I had 1 million total capital, I would never bet more than $50,000(5%) on any one trade. 20% of 1 million is 200k. That would be my trading capital. On less confident trades I would risk no more than 5% of this or $10,000 on any one trade.

      With FSC , for example, I have a 91% confidence in that trade, as I have mentioned. Its repeat ability gives me the confidence to wager up to 5% of my total capital per turn, which is the $50,000, based upon a hypothetical 1 million dollar account.

      Hopefully that clarifies my position to others and I thank you for bringing the question forward.

      Best to you Salty,

      DocReits

      BTW, thank you for the tip on WPZ. As you might know, I only trade stocks with consistent historical runs towards EX. WPZ does not qualify. Just my style....;-)

 
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