Loading ...So tired of it….
Gap up open in the metals, then they are faded the rest of the day. Over and over and over. Don’t get me wrong, the last couple of months have on net been spectacular for anyone long silver miners, but this has been one of the ugliest rallies I have ever seen. Up 50%, down 25%, then back up 25%–that’s been my account (and frankly, basically my net worth), all within a 2 month window. That is utterly insane volatility. As long as the November lows aren’t snapped, I think I will be able to comfortably stomach this movement. I agree with Chartmaster on this, it’s not a matter of if, but when silver makes a huge break (I’ve been thinking we wouldn’t get a breakout until later this year, but I won”t complain if it comes earlier than that). Of course, that is just my opinion and there is always unpredictable risk, as GME longs found out yesterday.
If you aren’t a “believer” in the metals, there is likely no way you can hang onto positions long enough to make huge gains. Most sane people won’t tolerate 25% much less 50% swings in their accounts to see it through.
Use the volitility to your trading advantage, sell into irrational exuberance then buy back the dip for a quick scalp.
No way I could do that consistently. There are also capital gain tax implications. My thesis for the last 20 years has always been to wait for “the big one.” And ultimately, hopefully, only be on the hook for LT capital gains. Of course, Biden has promised to raise the LT capital gains tax, but who knows.
I caught lightning in a bottle back in 2010-11 with silver. In hindsight, those types of moves that you participate in only happen once or twice in ones life. I am hopeful that I am going to get a second chance and this time make better decisions about liquidating positions after meeting my financial goals. One big difference for me personally is I am using zero leverage this time, which is already a huge factor in terms of my risk.
Just give me a nice grind higher vs. a Gamestop freak show thing any day.
Yeah, forgot about capital gain problem. That is the beauty of a self directed IRA account where I do most of my scalp trade. “because you don’t have to count your winnings until the game is done” LOL At one point today I was trading AUMN out of my TD watch list that contains all my current holdings. I had sold 100 shares five cent higher and I wanted to buy it back for a quick $5 profit but instead I clicked on what thought was AUMN but it was AG instead. I quickly sold AG back at even but this killed a lot of my trading cash and I now have to wait 2 days for everything to settle, oh well I just hope I didn’t violate regulation T as I am already sitting with two strikes there in a three strike game…yikes!
Thank you Sir JSKauai for sharing your “trading activities” in so much detail.
About 12-13 years ago, one of my work colleagues remarked to me … “even if I make $2 in a trade, I wasn’t wrong in that trade”.
Another neighbor told me “I trade, so that I can get the cost of my liquor, free”
We always seek the big pay day, and we think we can game Uncle Sam, in case the trading account is separate from an IRA.
Never so.
I have learned the very hard way to increase my AUM (assets under mgmt) slowly and steadily, and reflect that in my realized gains, year over year.
2018: Totals: Adj cost X Adj gain (%) 100.66
2019: Totals: Adj cost 2.7X Adj gain (%) 57.75
2020: Totals: Adj cost 3.7X Adj gain (%) 98.19
Thanks
GL