J Peter Lynch’s Solar Portfolio Closed out - Outperforms Market by 412%
New York, New York- March 7, 2012- Solar stocks report at Investorideas.com
Investorideas.com, a leader in renewable energy stock research for independent investors releases solar stocks commentary from solar expert, J Peter Lynch. Mr. Lynch discusses the solar stocks portfolio performance for 2012, his current positions sold out and his outlook for the sector.
Solar Stocks Commentary with J Peter Lynch at Investorideas.com
http://www.investorideas.com/PL/
Current Status
Our portfolios two remaining positions - CSIQ (600 shares) and LDK (500 shares) were closed out on Monday CSIQ @ $3.50 and Tuesday LDK @ $5.25 after they hit their respective stop loss prices.
The final status of the 2012 portfolio was a gain of 18.98% with a holding time of 9 weeks.
Since the date 1/11/2012 we started the portfolio the solar sector as a whole, including our portfolio stocks is down an average of -7.8% vs our portfolio gain of +18.98%.
The market in general during this period is UP an average of 4.6% with our solar portfolio outperforming the general markets by over 400% (412%).
Stop Loss Points
We sold all the positions in our portfolio when they hit their stop loss points that were set very close due to the fact that the market was very over bought and overdue for a correction.
We adhered to our system and did not question whether to sell or not. If one of our positions hit the designed stop point we sold – without question. By doing this we minimized our losses and rode our gains as far as we could.
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Remember – the number one rule of investing:
Minimize your LOSSES and Maximize your GAINS.
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Market Psychology
The HARDEST THING for investors to do is know when to sell. That is why you have to set specific, non-emotional prices to exit if things do not go right. You cannot allow your emotions to get involved and take over your thinking.
Trust in your system and follow it regardless of what you think “should happen”. Once you try to impose your will on your portfolio you will stop paying attention to what is most important - “what is” NOT what you think it should be.
Remember this system has enabled us to significantly outperform the rest of the solar sector and the general markets in 2010 and 2011:
Summary Performance
2010: Solar Portfolio outperforms markets by 310%
Solar Portfolio + 42.94%
Solar Industry Average -14.2%
Major Markets Average + 13.87%
2011: Solar Portfolio outperforms markets by 1,416%
Solar Portfolio + 17.56%
Solar Industry Average - 70.3%
Major Markets Average + 1.24%
General Market Comments
Today the market had a big down day and may have started the correction that I was anticipated.
At this point the general market is still looking like this will only be a correction and that once it has run its course the markets advance will continue. Since solar stocks as a whole have much higher volatility (beta) than the general markets I would expect them to fall further than the market and perhaps give us another buying opportunity later this year..
Keep in mind that periodic corrections are normal in the stock market – what was NOT normal is for the market to be sharply up, without a correction since October 2011.
Background Analysis Notes
Keep in mind that there are two basic types of equity (stock) analysis. Below are a brief description of each and its primary purpose:
Fundamental Analysis – this is the analysis of the fundamental financial condition of a company to identify which stocks you may want to buy when the timing is right. This form of analysis will give you NO indication of the best time to buy a stock or sell a stock.
Technical Analysis – this form of analysis will tell you “when” to buy a stock and when to sell the stock. It will do this by showing you (in chart format) the basic interaction of supply and demand and when the two change and shift which will indicate a time to buy or a time to sell.
Mr. Lynch has worked, for 35 years as a Wall Street security analyst, an independent security analyst and private investor in small emerging technology companies. He has been actively involved in following developments in the renewable energy sector since 1977 and is regarded as an expert in this field. He was the contributing editor for 17 years to the Photovoltaic Insider Report, an early publication in PV that was directed at industrial subscribers, such as major energy companies, utilities and governments around the world. He is currently a private investor and has from time to time been a financial/technology consultant to a number of companies. He can be reached via e-mail at: SOLARJPL@aol.com. Please visit his website for the promotion of solar energy – www.sunseries.net.
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