The Pains and Gains in Speculations

 

 

牛经沧海

 

 

 

I bought SQNM at 3.25 on 10/22/2003 (before 1 for 3 reverse split). It went up to over $4 on the next two months. Before I was able to celebrate the magic of junk stock picking, it dropped to the abyss $1 during the summer doldrums of 2004. After another year of suffering, it appeared to have no hope of recovery. I finally dumped it at the end of 2005 for a tax sale and to realized a total loss almost.

 

 

Transaction Status	Order Description	Date & Time	Price Executed
Order Placed - SQNM	Sell SQNM Mkt Day	12/11/05 02:47:13 PM EST	--
Executed - SQNM	Sell SQNM Mkt Day	12/12/05 09:30:18 AM EST	0.7300

 

 

After dumped it, I continued to watch the SQNM and to my delight, dropping further for anther year or so. It was reverse split to satisfy the Nasdaq listing requirements in the summer of 2006.

 

 

Did I really make a sound decision to close my positions on SQNM? Not if you check SQNM again, it reached as high as $23 and stays around $21 now. Should I keep the positions, I would have more than doubled my initial investments. Considering that I did have a strong conviction that SQNM should be potentially a major player in its field when I scooped it out from the sewage.

 

 

The other side of the speculation story was told by ILMN. I bought it on 05/27/03 at $2.03. It last sells for $86.25.

 

 

 

It would be a fair game if I hold all ILMN positions to date. Unfortunately, I reduced twice when the shares appreciated, once at $14.20 in early 2005 and another at 32.50 in 2007:

 

 

 

Transaction Status	Order Description	Date & Time	Price Executed
Order Placed - ILMN	Sell ILMN Limit Day	05/01/07 02:11:16 PM EDT	--
Executed - ILMN	Sell ILMN Limit Day	05/01/07 02:22:13 PM EDT	32.50

 

 

The moral of the story is that it is hard to hang on your own conviction either it proves to be correct or wrong, not to mention to consistently follow someone else’s (most likely a stranger) advices.

 

 

A follow up speculation: next year might be another great year of junk salvaging of financial stocks, just like 2003 when numerous tech names were abandoned?

 

 

Disclaim: The author is not a Registered Investment Advisor or a Broker/Dealer. The author’ s discussions do not serve as recommendations or suggestions for buying or selling any stocks or other instruments. The information contained in the blog is provided as is without warranty of any kind, expressed or implied, including, but not limited to, any implied warranties of merchantability and fitness for a particular purpose.