Taking stock of the financial year of 2017 and adjusting my direction for 2018

Topic: my poor trading skills, and total tally for 2012-2017, as well as my plans for 2018

Length: short

Conclusion: I’ll quit trading listed stocks (after a final handful of  +100%-ers)


Hubris

(see my post on Hubris here in the TAOS series)

Six years ago I opened a private trading account. I did it mainly to take advantage of the coming stock market crash. It never came, and as a result I lost 15.3 million SEK on my short Swedish stocks position (Nasdaq OMX S30 index) – almost 2m USD. This year I sold the last of that position, which means I can finally take stock of the position and tally the result.


Positive surprise

I thought I had barely made up for the losses on other positions, maybe falling short by as much as 5 million SEK or so, but when I finally found the tool for it today, it turned out I’ve made a positive total result of +1.8 million SEK on my trading account. That means my other positions have gained 17.1 million SEK over the same 6-year period. I should be embarrassed – not by the result but by my not knowing the result, and not caring.

Anyway, I’ve learned a handful of things from this experience:

  • I don’t care about financial losses (too little, since I haven’t bothered to stop the losses or even to calculate the result)
  • I hardly care about gains (I like being proven right, but it’s a very fleeting sensation – and a year later it’s completely gone; I couldn’t care less whether I have 2 million USD more or less in my bank account)
  • I’m not good at predicting the market or at trading
  • It’s been a waste of time (except for these lessons)
  • The obvious conclusion is that I should (and will) stop trading listed stocks, and thus free up many quality hours for 2018

Other trading results: why did I make 2 measly dollars in profit on Hennes & Mauritz?

Some people may be interested to know that my life time result on Hennes & Mauritz is 22 SEK (about 2 dollars and 50 cents — I made one single trade on September 20, 2016 in the stock); that I made half a million SEK in profits on Net Gaming Europe in 2017, and about as much on Gaming Innovation Group over the 2 years I’ve been active in the stock.

Some Swedes might be surprised to learn that if I add up my lifetime losses on Studsvik and Stockwik and add in my result on URA(nium), CF Industries (Thank you Jesse Felder [I think]), Xact Bull x2, BEAR x15, FING(erprint) and Finepart; that entire pile of dog excrement amounted to nil, zip, nothing but a waste of time.


Calling it quits – soon

Going into 2018, I only hold a few small listed positions in Stockwik, Finepart and Net Gaming Europe, plus a for-fun-position in BEAR x15 (i.e., a devil’s instrument for being short the Swedish stock market with a leverage of 1500%). My plan is to get rid of all of them in the coming 12 months unless the market or any of the companies significantly changes character.

I think all positions are set up for 100% gains each in 2018. But, hey, who would listen to the guy who just admitted he lost a fortune on one single position going against the best bull market of a century?

Draghi said “Whatever it takes” back in 2012. Did I listen? Yes. Did I understand or believe him. Apparently not.

Look out for another year end report on the more important aspects of life in a few days.

Meanwhile, here is my pre-year end review for 2016, and the actual YER2016 and here is the one for 2105, and a bonus one that I wrote in May 2016. I’ll use those as templates for my coming real Year End Review for 2017.

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3 Comments

  1. I respect this kind of attitude. Wealthy people can just go to the beach and not stress out about mundane details.

    This is why I have abandoned all the university taught theories on fundamental analysis. It’s a huge amount of work, which hardly ever pays off in the real world where crowd behavior rules most of the time. Plus it’s based on public facts, which can be deceiving. If you cannot trust the facts –> garbage in garbage out.

    It turns out, most stock market performance can be captured by being invested for only a few key days per year. A very good trading strategy is wait for your favorite over bought or over sold indicator and play for the reaction. When a rubber band is stretched tight, it wants to go the other way. Use stop orders to enter so nothing happens if your timing is wrong, and you don’t have to sit in front of a computer 24×7.

    For a very hands off approach, just wait for large corrections, then buy/hold. Those are the rare occasions when downside risk is much less than the upside. It only happens a few times in your life, so there’s really no work involved.

  2. I cannot pretend that I understand much about finances, but I always find your articles on the subject interesting.

    I’ve been investing “heavily” by my standards in Bitcoin this year, but I don’t see myself keeping up with that. The fees have gotten too rich for my blood. I would rather not piss away the $5,000 that I just got last month.

    Purchasing $100 worth of Bitcoin cost $18 just moving from Coinbase to my private wallet tonight. I will keep hodling the Bitcoin I own and invest more into Ethereum and GNT(Golem.) Those are the two cryptos where I see the most long-term value for the moment.

    Best of luck to you in 2018.

  3. You are, and will still be my influencer, Mikael. I haven’t taken the BEARx15 position, but I have been going short on stock market the last 1-2 years. I’m more worried about what will happen after the stock market crash in the world economy….Thanks for sharing your experience and yourself!

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