When I started this blog with portfolios managed by automated trading systems I thought it would be interesting to post each orders daily on StockTwits and Twitter. And it is, I very much enjoy it, I get some very interesting feedback from other fellow traders. There is one thing I did not anticipate however: The Stock Groupie!
The Stock Groupie will usually not manifest himself when I post BUY orders, sometimes I get “likes” or people agreeing with the BUY order, that does not make one a groupie, this is the typical positive fellow trader commenting, it’s all good.
The Stock Groupie will come out of his lair only when the SELL order is posted. This is when he starts looking for blood; “You are dumb!”, “A traitor!”, “Wrong, so wrong!”, “Time will show you how wrong you are!”, “This stock is the best investment ever what a mistake you are making!”.
When that happens, I actually feel sad for the Stock Groupie because I think that being so emotionally linked to a stock can bring mostly loss and despair. Here are some common traits I think most Stock Groupies are afflicted with, if you have more than 3, you should get yourself checked!
- You have a unhealthy allocation in one stock in particular.
- Most likely a Bio Pharma or Tech stock.
- You are convinced this is your 10 bagger stock.
- You know all posters of all message boards talking about this stock (and you’re a major contributor!).
- You “feel” it will go up anytime now, a matter of hours or days.
- You have been holding on a loosing trade for weeks or months.
- You think random tweets from strangers can influence the stock price in a big negative way
- You over-think every news that come out about the stock instead of looking at the actual price action.
The cure is very simple but hard to swallow: Sell the stock and move on!
Let me know if you can think of more Stock Groupie traits, with your help we might heal them all!