March 10, 2007
Studying Mr. Kirk’s Trades in Detail (#5 in a Series)
This is one that I understand more easily since I’m a play-of-the-day, explosive pace, light-up-the-scanner, stock du jour man myself. Nevertheless I’m interested to hear what you guys think about the mechanics of Kirk’s entry and exit.
January 18, 2007
- Sold 3,000 of HOKU at $6.88 (cost $5.53) (intraday): profit $4,050.00 (+24.42%)
Related: Studying Mr. Kirk’s Trades in Detail (#4 in a Series)
Cat: | Time: 7:12 am (utc+8)
March 10th, 2007 at 12:42 pm
I would have probably entered about 35-40 cents higher. Awesome trade!
March 10th, 2007 at 1:09 pm
cm,
He seemed to have longed the stock to hold against 5.50 at worst 5.30. Why didn’t he take anything out to lock in especially near 6, since 6 is another level? Given a 3000 lot, this might seem large depending on risk tolerance but wouldn’t it be sensible to lock in some during lunchtime with a profit of at least 5x the risk? I don’t trade nasdaqs but was this one as volatile as some otc stocks I’ve seen? As they can spread against his profit target quickly. By the way, very informative blog cm, great work.
Ronn
March 10th, 2007 at 3:13 pm
The mechanics of the trade:
a. gap up with volume
b. wait for fading
c. buy the first bar that closes above the previous high - stop below the low
(another choice would be to buy above the open price)
d. trail the trade - don’t risk more than you can gain
March 10th, 2007 at 7:34 pm
Andy: You mean you normally enter above the opening range high?
Ronn: For all we know his exit price may be an average from multiple sales but I suspect it isn’t. Also we have no idea how Kirk managed his risk by trailing the stop. These are the interesting details I thought he shared in his notes (but apparently doesn’t).
pepe: Sounds very Dummy. ;-)
March 10th, 2007 at 11:20 pm
I’ve been a member of the Kirk report for a year, I’m also a trial member of cramer’s action alerts. I can tell you that I like Kirk and think his website is helpful and he generously shares his insights into stocks constantly. It’s a great site. That said, I’m becoming a bit of a skeptic about his actual trades which seem too good to be true, at times. You do not see these trades posted in real time. Even the trades he posts that he holds overnight are often already well in the money when they’re posted, sometimes with an eight percent gain during the day. He claims he doesn’t want anyone following him–hey why boost your stock prices with a bunch of minions? My experience is simple: ignore all trading claims that you have not witnessed in real time or have a potential to see them in real time even if he seems like such a good guy as Kirk. There is plenty of motivation to post an extraordinary trading record when you’re getting 50 bucks per member or your site and you likely have several thousand members. Let’s see 150 grand a year for running a blog. Not chump change, my friends.
Now to Cramer. His action alerts portfolio which began in jan. 1 2002 has gained a total of 27% as of today including dividends the s&p has gained around 22% since then. But if you bought the market using a no brainer like vti you’d be up closer to 30% with less volatility and no trading costs and if you added a bit of foreign exposure (I’ll leave out the energy, metals plays), you’d be up another ten percent, likely.
That said, Cramer has incredible resourses at his fingertips, more than Kirk. And Kirk could be a genius, indeed. I’m not saying he is or isn’t. I would be surprised if he’s posting false trades but I would also be surprised if his record is as spectacular as it is. I’ve never seen anyone with that kind of record. But without proof, it’s like the fish that got away. He was the size of the canoe but he broke the line.
Don’t want to spoil the party, Chairman, but unless you know something that I don’t (and I hope you do) then your analysis may be a bit in vain. Either way, Kirk is laughing all the way to the bank.
Right now he’s short the russel, has been for several days. He’s down 2%, but when he posted he’d magically found the absolute top (the 1400 resistance) and so he posted with a decent gain. Hmmmm…
March 10th, 2007 at 11:27 pm
kirk’s biggest advantage is his method of thinking. he structures his thoughts his very well and is able to entertain and present diametrically opposed thoughts in a n engaging way. i have no doubt that kirk’s trades are all legit. he seems like a guy with tremendous character and that’s been reflected in his writing across the years.
March 10th, 2007 at 11:37 pm
billsenior: Thanks for your comment. I too have been amazed by Kirk’s win/loss ratio, but I’ll give him the benefit of the doubt and patiently wait for the audited record to be released.
I read in the Barron’s feature on Kirk that he has something like 750 paying members which is less than 40 grand a year — lousy pay for busting his ass blogging. I think he’s like the rest of us who simply blog for the fun of it.
Anyway, I still think it’s useful to dissect his plays through a group effort and look forward to summarizing the unifying aspects of his trades.
March 10th, 2007 at 11:42 pm
Chairman, I didn’t know an audited record is to be released. Is it? That would throw cold water on everything I just said. In fact, I’d renew my subscription.
March 10th, 2007 at 11:51 pm
billsenior: I thought I read him say that he planned to have his results audited, but my memory may be faulty. If someone has a link to that post it would be great, but I may be remembering things wrong (and by the way, where are my house keys?) ;-)
March 11th, 2007 at 12:04 am
chairman, if you’re interested in following a trader in real time, take a free trail at daytraders.com (I think that’s the site), there’s a guy on that site who goes by the name hollowpt, (I’m not sure he’s still there as I haven’t belonged since the summer). I’ve never seen anything quite like this guy (quite a few people follow him into and out of his positions). They’re mostly intraday. I don’t know if he’s playing off pivot points (when I was studying his moves, I didn’t know about pivot points). He trades about a dozen stocks like beas and klac. He’s been doing it 40 years or so. He’s not the room monitor, just some guy. There is a true performance to watch, you can download the room transcripts at the end of the day if you don’t want to waste time. You can follow him in, and I can assure you from the six weeks I followed him every day last summer, he rarely screwed up. But there it was, right before me own eyes in real time.
He did mention that he screws up big time when he does screw up, though. Every psyche seems to have this financial death wish thing going on. I didn’t see it with him, but at least he talks about it.
Love your site by the way.
March 11th, 2007 at 12:12 am
I have dissected his plays extensively.
My conclusion is this:
1) They are real trades.
2) He uses TradeIdeas to alert him when one of his watchlist stocks gaps at open or has significant volume at the open.
3) His watchlist consists of low float, strong fundamental (according to his research), little to no institutional interest (below the radar) stocks.
4) Entry is more than likely using 5M chart @ support or breaking previous day/intraday opening range. Exit is almost always End-Of-Day if a daytrade.
That is my analysis of his trades and I have studied all of his trades going back to the start of his blog.
Your take CM?
March 11th, 2007 at 12:20 am
correction: of course he exists @ end of day if a day trade….I must of been asleep at the wheel with that comment.
What I meant was the day trades close strong and very near high of day where he exits.
March 11th, 2007 at 1:12 am
I forgot to mention.
He (Mr. Kirk) will be posting video’s in the near future of the how, why and what he was looking at when he made his trades. This will be for paying members (”donation”) only.
He’s recently, in the paid member area, started posting most if not all of the stocks he is watching with comments.
He is basically giving what the readers want at this point but just shy of sharing his actual fundamental screening process which is understandable.
Although in my experience you can give away the rules to make guaranteed money and people will still screw it up. Human nature makes sure of that.
March 11th, 2007 at 7:29 am
billsenior: Glad you like the site and thanks for the info on “hollowpt.”
StockRoach: Thanks for your excellent observations … I’ll definitely include them in my summary post on Kirk’s trades.
March 11th, 2007 at 7:49 am
[…] Related: Studying Mr. Kirk’s Trades in Detail (#5 in a Series) Cat: […]
March 11th, 2007 at 9:33 am
CM: I will also add that I asked Mr. Kirk through an email a few months ago about short interest and he replied that he does consider short interest though it wasn’t a large factor in his analysis of each stock.
March 11th, 2007 at 10:38 am
SR: Great, thanks for the insight.
March 11th, 2007 at 2:16 pm
i too saw the post about the audited trades. i am not a member. if memory serves me right, he said that he posts audited records every single year.
March 11th, 2007 at 3:51 pm
Born2: I searched for the terms “audited” and “audit” on his site and couldn’t find any relevant posts, so maybe we’re thinking of someone else. I’ve never seen an audited record for any single year, but if you can find one I’d be thrilled to read it.
March 11th, 2007 at 8:40 pm
AFTER the Barrons article Kirk gained about 2000 new paying members - his blogging slowed during this period while he adjusted to the new membership…
There is a guy who does real time trades and uses Paltalk to announce the trades live - maybe 15-20 trades a day - his records show he made about $2million a year - using a proprietary regression methodology - buying lows and selling highs of high beta stocks - its was impossible to tell what he was really doing…
“Selling XYZ here” “Selling XYZ at 82.50″
By the time you could scan down a watch list XYZ was at 81.90. A lengthy google search discovered a transcript (maybe on page 20) in which the guy told the planning board he couldn’t afford to make the changes to his trailer as required by the local zoning ordinance…
March 11th, 2007 at 10:33 pm
Bob: A Barron’s feature is good for 2,000 new subscribers? Not sure where you’re getting your information, but if it’s accurate, that’s impressive.
March 12th, 2007 at 12:38 am
From Kirk…
I was one of them. :-)
March 12th, 2007 at 4:26 am
Hollowpt is very good but imo if you follow hollow you will not do as well, from what I saw he adds till he is right and has the power to do so.
March 12th, 2007 at 8:04 am
Glenn: “Adds till he is right,” I love it — goes directly against everything I know about trading and poker (fold early and often).
March 12th, 2007 at 8:48 am
here is the link i found on his site
he clearly states: “These final performance results will also be verified by an outside accountant for accuracy by the end of the first quarter and any changes to the final totals will be announced if and when necessary.”
This page refers to the 2006 results, though i am certain — for some reason — that i read something similar much earlier than that on his site. My guess is that it was a link he provided in one of his free end-of-week emails that i subscribe to.
March 12th, 2007 at 7:50 pm
The choice to publish his results ex-post sounds very like the Monday morning quarterback claims.
I don’t want to say he didn’t do but that it’s just not credible.
So, I’d like to mention the new blog of a great trader, Tony Oz, who has won three times a public contest
To me, one of the best things on the net.