Author: Michael Wagner

Covestor model: Small-Cap Swing Trader

My portfolio rose about 8% in December.

The one ugly loss was a mistake of not cutting BORK quickly enough when it went against me. The best win of the month was short selling RAYS, which was to my mind an obvious short, but it was difficult to find shares to borrow. I found shares, and re-shorted RAYS near the end of the month, and as of January 5 still hold it. I also had a good win on SPAH in December. There were several other trades that made or lost a little money, but nothing significant.

2011 was not the best year I have had. Any time you have a losing record over the course of the year, that forces you to look hard at where mistakes were made. My main mistakes were trying too many different strategies at once, and having a bad break when the markets tanked in early August and half the portfolio was long speculative biotech stocks.

The only thing that saved me somewhat is my knowledge of short selling penny stocks. After going back through all of the records I keep, I noticed that if I had only traded that particular strategy (both long and short) the account would have been firmly in the black for 2011. Lesson learned, strategy adjusted. My position sizing will also be adjusted to be quite a bit more aggressive on my higher conviction trades.

Looking forward to a better 2012.