Replies to post #6214 on Biotech Values

[the_busy_ant]

I had a 28% return this year (a lot of it realized).

Part of this was due to the fact that I liquidated some of my positions when I *thought* I was going to buy some real estate. The real estate deal fell through, and the stocks that I had liquidated promptly tanked in the traditional biotech summer swoon--leaving me w/ realized gains but also allowing me to buy back in at substantially lower prices.

As they say...Even a broken clock is right twice a day.

I also made decent 'income' selling covered calls. But even one of these sales ended up costing me a little bit.

I sold covered calls ($30 strike) against my QLTI position (I bought @ $15). I was more than happy to be holding the open call position when QLT briefly popped over 30 this year, thinking that I would have my shares called away. Unfortunately, QLT quickly and steadily tanked and I refused to close my call position until they expired. By the time they expired QLT was @ 23.5--penny wise, pound foolish.

As far as losses, my biggest was ICOS. bought @ 35...sold @ 28. Then bought back in @ 25.

I agree pretty much with everything pgs said though. Selling those D-day losers ASAP has given me much more peace of mind than holding onto them and praying for a bounce.

[Aiming4]

PARS rebound opportunity...

I completely agree with you in regards to wanting to be out of a company that has had a serious failure.

But in the case of PARS, the % differences are significant between what the stock was liquidated for by most longs on the day of the failure announcement ($1.10 to $1.15), then what it could have easily been bought and sold for over the past few days ($1.15 vs. $1.50+):
http://finance.yahoo.com/q/hp?s=PARS

The appreciation over the past few days was 30% or more, which is hellacious for a few days trading.

Believe me, at this point I want no part of PARS as an investment, but I'm wondering if these bounces after a huge drop are becoming more predictable due to daytraders.

In the case of PARS, the low value of the stock almost certainly helped attract the momentum players, look at the incredible volume the past 6 trading days in the above chart.

Just curious if anyone has adopted a strategy of successfully playing failure bounces... Aiming4.