Reddit is a little bit dangerous here. It is a very expensive stock with a short trading record that has run up massively of late. But it has pulled back, and is still within the confines of its regression channel.
Ordinarily I don't trade stocks without large piles of trading data to fall back on. So why this time? First of all, the reason I don't is primarily that newer stocks have a much higher failure rate (going to zero) than battle tested ones do. Given that the strategy I use is first and foremost about safety, going to zero is a HUGE no no so I avoid them by and large.
I don't think that's an even remote risk in the case of RDDT, however.
Secondly, in its brief history with my system it has performed very well from a per day held return standpoint (around 1.5% per day held, or about 55x the long term daily average return of SPY). While that number will tend to decrease over time with more trades, even a return half that size is a sizable daily return.
Also, every trade signal has been profitable to this point, but again the small sample size renders that information basically irrelevant. In the end, I have to respect the trend here and trust that
RDDT will follow the same pattern that the other almost 2000 stocks I screen follow and that this trade will work out because it's what stocks do. We shall see, I guess.
Per my usual strategy, I'll add to my position at the close on any day it still rates as a “buy” and I will use FPC (first profitable close) to exit any lot on the day it closes at any profit.
As always - this is intended as "edutainment" and my perspective on what I am or would be doing, not a recommendation for you to buy or sell. Act accordingly and invest at your own risk. DYOR and only make investments that make good financial sense for you in your current situation.
Ordinarily I don't trade stocks without large piles of trading data to fall back on. So why this time? First of all, the reason I don't is primarily that newer stocks have a much higher failure rate (going to zero) than battle tested ones do. Given that the strategy I use is first and foremost about safety, going to zero is a HUGE no no so I avoid them by and large.
I don't think that's an even remote risk in the case of RDDT, however.
Secondly, in its brief history with my system it has performed very well from a per day held return standpoint (around 1.5% per day held, or about 55x the long term daily average return of SPY). While that number will tend to decrease over time with more trades, even a return half that size is a sizable daily return.
Also, every trade signal has been profitable to this point, but again the small sample size renders that information basically irrelevant. In the end, I have to respect the trend here and trust that
RDDT will follow the same pattern that the other almost 2000 stocks I screen follow and that this trade will work out because it's what stocks do. We shall see, I guess.Per my usual strategy, I'll add to my position at the close on any day it still rates as a “buy” and I will use FPC (first profitable close) to exit any lot on the day it closes at any profit.
As always - this is intended as "edutainment" and my perspective on what I am or would be doing, not a recommendation for you to buy or sell. Act accordingly and invest at your own risk. DYOR and only make investments that make good financial sense for you in your current situation.
Note
I just noticed a typo and it is too late to edit it, so I'll correct it here. The average daily return of RDDT is about 35x that of SPY, not 55xNote
"Reddit is a little bit dangerous here". I'm gonna have to start making more optimistic statements, since I seem to be manifesting tragedy with ones like this. Added another lot at 187.13 on the close. Currently holding 2 lots.Note
Sold the lot purchased yesterday for 189.66 at the close for a 1 day gain of 1.35%.Lots held:
Lot 1 - 196.21
Note
I forgot to update this yesterday but since it's Saturday, no harm no foul. I added to my position with another lot just before the close at 166.35 yesterday.Note
Added lot #3 at 165.00 today. I liked the end of day rally. It felt like shorts covering what was a profitable little several days dive for them. We'll see tomorrow if that premise is valid.Note
I forgot to update this yesterday, so I can't take credit for the lot I bought then 🤬. At least I have the money in my pocket in real life. Anyway, I sold lots 2&3 today at the close for 168.10.166.35 --> 168.10 = +1.05% in 3 trading days
165.50 --> 168.10 = +1.88% in 2 trading days
Lots held:
Lot 1 - 196.21
Note
"Reddit is a little bit dangerous here" - lol. Now down 45% since Valentine's Day when I opened the trade. If you are looking for a worst case scenario, I think I found it. And yet, I'm still here because I believe in the system I use. In fact, after today's monster drop, my algo is flashing buy again, so I added another lot at 107.29. Lots held:
Lot 1 - 196.21
Lot 5 - 107.29
Note
Sold lot 5 at the close today for 122.73, a +14.39% gain in one trading day. That one helped a LOT. With the 4 lots that have been closed profitably, I'm now "only" down 18.8% in total, despite the original lot still being down over 37% - all with the same capital exposure I had in the original trade. Here's hoping for another couple of days like this one. Lots held:
Lot 1 - 196.21
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The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.