January wrap up

I know I haven't been posting much here, and I'll try and get back up to date with that soon. In the mean time, I'm going to kind of do a wrap up for the month of January. First, the good stuff. My portfolio returned 4.93% for the month of January, which is a pretty good number considering the S&P returned 1.41% that month, the DJIA returned 1.27%, and the NASDAQ returned 2.51%. So I got a pretty healthy return over the averages.

I mainly was able to accomplish this because January was a pretty high volatility month in the market, so while it may have gained 1.5% or whatever on average, it did so in an up and down fashion, not a straight line. That way, by trimming my positions as the market went up, then buying them back as the market went down I was able to use the market's natural volatility to capture some additional returns. I always kept enough cash in my portfolio to add to positions as they went 'on sale' and was always prudent enough to trim them as things went up.

Another thing that helped is I rode the NASDAQ's technology spike early in the year, but around mid-month I dumped all my technology names save AAPL, GOOG, and HPQ because I feel those 3 will still perform even though this is a seasonally bad time for technology. In AAPL, the iPhone news boosted the stock big time (around 10 pts) and I took off half my position very near the high. I bought it all back as it's since dropped those 10 points because I'm bullish long term, but it seemed irrational for any stock to jump well over 10% in a week on a product that isn't even out yet, so I used the market's overreaction to book some gains.

I also started dabbling a little in both short selling and options this month, although it really is just dabbling. I feel both of those are much higher risk than my usual strategies, and as such won't use them very heavily at all until I feel I have a true grasp on how to make good money with them. Even then, I tend to be somewhat conservative with my positions as I don't have a 'real job' to fall back on so capital preservation is much more important to me than capital appreciation, although I still strive to beat the markets for sure, I don't take super high risks either IMO. When I do, I do so with small amounts of capital I can afford to easily lose, and I usually do them in baskets to mitigate risk.

At any rate, I'm going to try and get back to updating more regularly now, but that's a quick summary for January, and if I can come anywhere close to duplicating the first 31 days of the year over the rest of the 365 it will be a profitable year indeed.

-Rizen