Last two days before the weekend I think I lost more then I've ever done at the poker tables due to mining shares dropping in value fast for no really apparent reason. And I had some baaad sessions 10/20 HU back in the day
Anyway, late on Friday I finally decided to take it as a blessing in disguise and use they money I had laying around since I took some profits in Sandstorm Gold (SLL.V/SAND)at 13.20CAD or something and put it back into the company at 11.12. I read up a bit of about this and most people just feel that it's been a few days where the big stock indexes has crashed down through various support levels and basically taken everything stock related with it. Markets are stupid (at least short term when they're not free but full of big banks with bailout money)^^.
Back in the day my dad used to be angry about automatic trading and "a bunch of robots fucking everything up". I'm not though. If someone wants to drive markets lower (divert from optimal strategy) to abuse weak longs/investors (fish) I'll just abuse the dumb fucks who drives the market down by buying the dips. It's just like poker. Fuck that, I'm not leveraged, as long as I'm in solid companies that makes money you can do whatever the fuck you want, I'll buy the dips. I've made 8 high call downs for half a stack and J-high for a few 100bb's, try scaring me away from something I believe in.
Although, this made me more then a little over invested in Sandstorm Gold lol, I think I have about 50% of my portfolio in it which is, ehh, "slightly" more then recommended. Well I've stated it before and I've state it again, if I'm ever in need of a God I hope Nolan Watson is up for the job. In case Jerry Garcia can't make it. Anyway, here's a article about the businesses model:
My good sir you've made another dangerous and misleading poker analogy! But I know its in jest.. cuz 100bbs was never = half your bankroll
I hope sandstorm gold explodes upwards for ya. But I'd think very carefully about the idea of the way reality (market prices) are generated inside of a blackbox, and reconsider how I allocate risk when the follies are coming from a process which is opaque to me (not like poker). Or sandstorm could hit the motherlode and you'll feel like an investing genius <3
Not to be too presumptuous. I'm not trying to say your investments are bad. Just trying to illustrate the line where the risk lessons from poker become irrelevant or dangerous in this other realm =)
Read this Nolan Watson's wiki. Impressive guy. Took a look at the stock chart of the company he briefly helmed as the youngest CEO. Has swung from $15 share in 08 to $5 in 09 to $40 in 2012
Yea obviously it's not optimal from a bankroll management stand point, it's actually pretty bad. However, it's not like putting 50% of my bankroll on the line for a few reasons:
1. Very little risk that they'd go broke within a reasonable time frame (risk of bankruptcy is basically non existent unless gold goes down with like 75% or if the whole company somehow is a scam of non-heard-of-proportions which is lol-unlikely). If they lose half their value or so it's still only 25% of my BR. I've lost 25% of my BR before.
2. It's less risk then normal miners due to their business model.
Also, the fact that the price of a stock drops 50% is only relevant if you actually need the money now. It's the price at the time of exit that actually matters.
If I'd have to guess I'd say it's less then 1% risk that I lose it all, probably about 20% that I'll lose a lot (~50K or whatever) and maybe 20% that I'll lose a little. Then 20% that nothing will really happen before I sell most of it again and the rest of the time the stock reaches my "take profit mark" again and in that case I'll probably be back to more reasonable (but still unreasonable according to most investing "advisors" level of commitment. It's a gamble, but I'm fairly certain it's +ev.
