I have sold 10 of my 40 "lottery picks" in my IRA, leaving 30 in place with tighter stops.
The reason is simple – – – the runup in C and BAC is a bit insane. The one and only reason these companies still exist is because they are being artificially propped up by the government. The 100% to 150% run-ups in price over the past week are terrific, but I think they're about done.
I enjoyed gains of between 30% and 70% during the past week in my closed lottery plays, but the risk outweighs the marginal potential reward at this point. Mind you, I wish I'd held on to my FAS position. I bought it a week ago and sold it at a 30% profit, and it has continued to soar much higher. But the beauty of these lottery plays is that they are small enough to permit me to "let them ride" without causing undue risk.
I am sitting on a loss with FAZ, but I have added to this position today. I don't normally average down, but this is a position I believe is going to pay off in the end.
