RobinHood race from $2,500 to $250,000

[Fermion]

Hi guys, a little update.

(I forgot my password for Fermion and lost access to the email account so created a new user name)

I am still trading in RobinHood and still working on the personal contest to massage $2500 into $250,000 in ten years.

Currently I am sitting at $11,750 and change, mostly cash except for 10 Gilead $65 call contracts expiring Jan 2020 that are down about $1200. My past trades in Merck have more than made up that little mishap of Gilead but I still hold out hope that $62 a share is just a little low value...we shall see. Every time some news comes out about biotech destruction because of price controls is when I have been buying and I sell a few days later when it recovers. It has been working fairly well. I should have held on to a little more Merck as it recovered more than others but oh well.

Currently up some 370% since a little over a year ago when we started this adventure.

 

[Fermion]

Got my account fixed, thanks! I also did a bit more trading in Merck and Gilead, and hit 400% gain, a bit over $12,500.

The three year goal is/was $10,240 (60% compounded per year for three years on $2500 start). I am now past that goal at not yet 1.5 years.

$250,000 on track!

 

[egleys]

I wish I could trade like you. If it was a race from $2500 to $0 I might give it a shot.

 

[Winemaker]

I have lost a good deal of $$$$ on Nektar, but still holding.

 

[Fermion]

Yes, Nektar was a dud. I lost a couple hundred on it I think in this account but never held long enough to get a big loss. It made me nervous when they botched the drug batches for their trials. BMY could just dump them one day and then it goes to cash, or about $8 a share. On the other hand, they could get their act together and be a blockbuster. Goldman dropped their buy to a sell with a $16 price target, which is right about where Nektar is now.

Right now I am at cash in the Robinhood account waiting to get back into Merck. I am just waiting on any dip to the $82 area and I am all in.

 

[Fermion]

Well, I got back into Merck before their earnings, a bit early since I had to watch my account drop to $10,000 as fears about Merck losing the lead in cancer fighting caused the stock to get pummeled. I held on with faith in Keytruda simply because it is in SO MANY studies and is constantly getting approvals for new indications.

Turns out I was right and Merck blew away all of the earnings estimates and raised full year guidance.

I ended up making $600 or so and now am at $13,150 but if I had just had a teeny bit more faith I would have bought big. I fell into the trap of not wanting to lose my hard fought 400% gain over the past year and was timid.

I am thinking about going big into Gilead with LEAPs, perhaps June 2020 at a $70 strike. Unsure about the effects of election year so I have not totally made up my mind but I think Gilead is going to get back in the $70s in 2020.

 

[Running_Man]

Very impressive, very impressive. You are showing quite a bit of skill at combining your knowledge of the, I will call it the drug industry, combined with market timing by utilizing contra human behavior.

Gillead is interesting, bouncing along right at a multi-year low, which is a direct contrast to MRK which is bouncing right against it's multi-year high. Typically I would be wary of the Gillead and looking to buy MRK right after it broke to the new high, especially with favorable earnings news. Is there an outlook to Gillead I am missing?

Here is a link to MRK's Value Line analysis. It is a very good looking intermediate to long term investment thesis. By 2029 the $2.20 annual dividend should be at $4.13 which would imply an expected stock price of about 185.
http://www3.valueline.com/dow30/f5814.pdf

RM

 

[Fermion]

Gilead is just out of favor right now but they have some things going on NASH and the KITE stuff that could really turn the ship. They have a boatload of cash, more cash than debt. It is just priced for failure, so if they don't fail, well then they should get into the $70s or even low $80s next year.

 

[Fermion]

If you snooze you loose. Gilead already up to $65 from the $62 area when I posted.

 

[Running_Man]

If you snooze you loose. Gilead already up to $65 from the $62 area when I posted.

Court ruled 2.54 Billion lawsuit by MERCK against GILLEAD could not proceed and was not anticipated to happen, so a major plus for Gillead

 

[Fermion]

Well, since I am at Disney World, I think I will end the week in mostly cash. I did a little trading of Gilead yesterday and added a few hundred cash to the balance.

Ending the week in all cash except for 5000 shares of ADXS, which is a really really long shot nano cap biotech trading at about 30 cents even though they have about $1.50 in cash and no debt. You know the market has no faith when you trade at nearly 1/4 cash.


Likely a loser but it could pop up a bit on a little good news from somewhere. A cigar butt for sure. I don't think it has the potential that Endocyte did but I do like a good lottery ticket now and then.


Currently at $13,607

 

[Fermion]

After reviewing our tax situation for this year I think I am going to have to let it wag the dog a bit on the Robinhood account and not do too much more trading for November and December.

It sucks and takes the realism out of the race but I could end up making a few thousand in RobinHood and owing four times that amount in taxes due to the ACA subsidy cliff. Because of the many accounts I have, I am scared to go within $3000 or so of the cliff's edge. I am about $6,000 away from the edge now, so not a lot of room.

I think I will either set up a covered call for Jan expiration so the taxes are in 2020 or just let the account stay in cash and buy the index on any big dip and just hold it for a Jan rally.

 

[GreenEggs]

Impressive gains.

I'd been thinking about trying my hand at the market & your thread has inspired me to open a RH account. I figure trading small amounts of real money makes more sense than paper trading with play money.



They gave me a share of GLUU-$6.03

 

[Fermion]

Impressive gains.

I'd been thinking about trying my hand at the market & your thread has inspired me to open a RH account. I figure trading small amounts of real money makes more sense than paper trading with play money.



They gave me a share of GLUU-$6.03

As long as you keep the amounts really small compared to your main investments I have found it to be quite fun.

 

[Fermion]

Oops, I made another ~$350 in Robinhood, despite my best efforts not to make any more money this year (because ACA cliff)

I couldn't help myself...

Very close to $14,000 now. $16,384 is where you want to be at the end of four years in order to be on track for making $250,000 off of $2,500 in ten years. Of course I am less than 1.5 years in on this competition of one.

I wish taxes were not an issue....Robinhood doesn't do IRAs though.

 

[GreenEggs]

I've been studying. I'm not sure how to find good stocks. Robinhood & Yahoo have their analysts ratings, and comparable stock lists. I found a variety of folks that want to sell trading recommendations.

Somehow I stumbled upon an impressive stock I'd never heard of, MSCI, which has done extremely well. It's gained about 415% over 5 years & 65% in 1 year.

That made me scratch my head about how to find other stocks that have done well over 5+ years. I found a list on Kiplinger with top 10 stocks over the past 10 years and realized that MSCI was in the top 3 of them in the 5 year time frame.

Then I did a search for finding a list of the top gainers over long time frames. I found a good one that covers them from 1 month to 5 years. It also gives insider trading listing too. It's called a screener. I think it will be very handy for helping me learn about what's been going on in the past and also what's been moving recently.

So, (newbie question coming...) what's wrong with making a group of 10+/- of the top gainers over
5 years. Checking them out on all the time frames, 5 days - 5 years, to confirm their strengths and divide my purse between them? They seem relatively diversified (I'll reexamine to confirm that). What's the likelihood that this portfolio will do well? Yes, it seems overly simple. (I have read to keep things simple. And most investors over-think things.) Placing them all on a chart and selecting the various timeframes seems like simple "backtesting". Is that effective enough?


Here's the screener that I found: https://www.finscreener.com/screener/top-gainers/stocks/sp500

 

[Fermion]

It might work out for you, I have no idea. I don't actually target specifically stocks that are high gainers and I invest mostly in biotech because it a lot of volatility and swings.

I guess I practice Warren Buffett's earlier form of investing, which he called Cigar Butt investing. He would examine companies who had been discarded and discounted by the market (like a used cigar butt) and he would see if they had a little puff left in them. If so, he would pick them up and enjoy great profit since his cost was so little (if you smoke a discarded cigar butt, while nasty, the purchase price was cheap!).

So I look at companies like Gilead. They still have a lot of potential and their balance sheet is still in great shape (more cash than debt, good cash flow, earnings decline is leveling off). The market, including Goldman with a $60 price target this past year, has essentially tossed them in the dirt. On the days that I see they are $62, I pick them up and give them a puff.

It works for me.

I do also occasionally pick up lottery ticket stocks, and have had some excellent luck with one, Endocyte. My current small lottery ticket stock that I have 2000 shares in Robinhood (purchased at $0.33) is Advaxis (ADXS). This is a horrible nanocap which has had reverse splits and has fallen soooo far. It is now trading at about 1/3 of actual net cash on hand. Endocyte was once trading like that, a buck a share when they had $3 in cash. I made a sort of joking post on here that we should group up and buy it out. The next year Endocyte was $24 a share.

 

[GreenEggs]

Fermion,

Thanks for the explanation of your trading style. It makes a lot of sense.


edit: So, wondering how to find Cigar Butts I went to the Finscreener site and discovered that they have a "Price Range Ratio" screener that ranks stocks by where they presently are within their 52-week range. That should give me some leads to follow.

 

[fireorbust]

UTSL. 3x leveraged based on utilities. buy it now and don't sell until you hit your goal of 250k. easy money.

 

[Fermion]

There is no such thing as easy money, fireorbust.

That being said, I did make a few more easy dollars in Robinhood.

Currently all cash except for the free stocks. $14,061 in cash.

I think I have about $4000 across my taxable accounts before going over the ACA cliff and losing $8,000 to subsidy repayment. I need to recalculate to make sure I have that much.

We have over a month left in 2019...that is just waaaaay too much time to let little RobinHood sit idle.

I am looking at Gilead today as it has dropped below $64 again. We are still not yet at ex-div and I expect a run during that week of $0.50 to $1. I think I will buy Gilead at $63.50 and sell at $64.50 before ex-div.

Also taking a peek at NKTR again. Merck is dipping but I would rather get it in the very very low 80s or high 70s....probably won't get there.

 

[dirtbiker]

What a fascinating thread! Your gains are beyond impressive. I just signed up for RH (mainly to get a free share - Sprint). I'll also send my wife an invitation, and we'll each get a free stock too. So far I don't like the interface, and with Etrade now commission free, there's not too much of a reason to keep it... But funding it with a small amount of play money doing just what you're doing is also quite intriguing... Either way, I'll be following your progress. Good luck on your continued success.

 

[Fermion]

Oops I did it again.

Made another ~350 in Robinhood on BMY (Bristol Meyers) today. Bought at dip since I feel good now about the long term prospects of BMY-CELG merger and earnings. Evidently everyone else started to feel good too as the stock recovered quickly.

Stupid ACA cliff. If I am not careful I am going to fall off it.

 

[Born2Fish]

Oops I did it again.

Made another ~350 in Robinhood on BMY (Bristol Meyers) today. Bought at dip since I feel good now about the long term prospects of BMY-CELG merger and earnings. Evidently everyone else started to feel good too as the stock recovered quickly.

Stupid ACA cliff. If I am not careful I am going to fall off it.

BMY announced they completed the CELG acquisition.

Price flip-flopped around heading into close.

 

[Fermion]

BMY announced they completed the CELG acquisition.

Price flip-flopped around heading into close.

Yes, I knew it was coming and I bought back in about 15 min before market close....20 March 2020 calls at $57.50 strike. I was kind of busy taking a tour of the Kennedy Space center so just did a quick buy on the tour bus when I noticed it had dipped to $55.60 again.

I got back home tonight and it *looks* like that one little buy made another $1800...I am not sure though as this is maybe after hours stuff. Tomorrow I will sell if it is still up but for now it shows my RobinHood account over $16,000. I am like a twig and blade of grass from the ACA cliff if I sell but I do like taking gains....its how I roll.

 

[bobandsherry]

I wish taxes were not an issue....Robinhood doesn't do IRAs though.

With all the big brokers now with no fees, is there any benefit to staying at RH? Maybe move money to ETrade, Fido or one of the others who do offer IRA? The sky's the limit then for you with no tax/ACA handcuff's on.