Avoid big loss: Define big loss - over $50 dollars is a big loss

 Sept. 30, 2020

Introduction

I have to learn how to control my gambling behavior, set stop loss early; Do not worry about missing Canadian oil stock rebound. I need to set $50.00 dollars stop loss for each bet. 

MRO 1000 shares on Sept. 28, 2020

I had over $180 dollars loss on MRO 1000 shares

I like to work on research how to stop loss with small amount. Otherwise I will lose my capital quickly. I have to learn how to stop loss early with small amount. 

Do not think about betting on big amount like 1000 shares for MRO, and also I need to check 5 days range of MRO stock first. What is range of swing when I like to make purchase? Use the range to determine how many shares I should bet on. 

For example, I like bet on MRO when price was $4.34/ share, five day minimum price is $4.06, so I need to take risk of $0.28/ share. If my limit of one bet is $50 dollars, then I should at most purchase 200 shares. If I do not set stop loss, then I may lose $50 dollars. 

Actually I bet on 1000 shares. The loss will be $280 dollars. 

Actionable Items

Bet on small amount. Try to have loss, loss, loss and big win. I need to learn how to stop loss early, and then catch big rebound if needed. 

I also record the video and here is the link on my youtube channel. 

I also record the video in Chinese to share my thoughts for my future to review. Here is the link.

Follow up

Oct. 17, 2021

I just could not believe what I wrote down. It is so good to read my thoughts and see my growth as an investor. Today MRO stock went up around $16/ share. 

April 21, 2022

I just could not believe that MRO stock price is around $26 dollars a share. I should have just held those 1000 shares for two years, then I will have $22,000 US dollars gain on my Ameritrade.com IRA account.

Is it too hard for me to learn how to be a long term investor? 

MRO stock: 1000 shares of MRO purchased on Sept. 28, 2020

 Sept. 30, 2020

Introduction

It is my short drill to practice how to hold 1000 shares of MRO stock. I like to write down something to remind me to learn something from my USA IRA account. 

MRO stock

It is easy to buy and sell since the volume is over 10,000,000 each day. I am not sure why so many investor buy and sell every day. 

I also think that oil price is low right now. If I can stay long time, then I should get 10 to 20% return at least. 

It is too many shares compared to the price $4.15. I already has loss 5%. I need to set trailing stop so that I will lose more than 500 dollars on this position, same as I did with SABR stock. 

MRO stock 1000 shares - stop loss

It is hard for me to learn how to stop loss early. I still gambled on Sept. 28, 2020. I thought that it was a good idea to bet on MRO rebound near 10%, so I stepped in when MRO rebounded around 4%, but it did not happen. 

It is important for me to stop loss early when the priced dropped 10cents, so that my loss would be $100 dollars for 1000 shares. If I set stop loss on 5 cents, then my 1000 shares of MRO stock will have $50.00 dollars. 

It is much easy for me to recover $50.00 dollars, but it is hard for me to recover $190 dolloar loss. 

It is hard to resist the gambling thoughts

It is hard for me to resist gambling thoughts. I have to be careful and take small stop loss instead of letting 1000 shares of investment go down almost 30 cent/ share. 

Use five day chart to calculate risk

It is better for me to calculate risk before I purchase 1000 shares of MRO stock. The lowest price is $4.06, so I can calculate the risk is $300 dollars if I do not stop loss early. Actually it is true that on Sept. 29, the price went down $4.06, I was so nervous, and I set trailing stop when the loss was around 5%. 

In the evening of Sept. 29, 2020, I put together a sell order to sell MRO 1000 share at price of 4.34, but it did not happen. 

Sold with $190 dollars loss

I have to learn how to cut loss each time I place a bet. Set stop loss around $50 dollars and make it less than $100 dollars. 

If I continue to bet on MRO stock, then I may end up with loss over $600 dollars. I had loss over $600 dollars on SABR stock. 

Actionable items:

Dec. 10, 2020

I learned the lesson. I sold 1000 share of MRO, now the price is around $7.0/ share. Almost 100% gains. I sold because I did not expect big gains and hard to beat the market. 

So it is more important for me to stay in long term, and bet on 80% return in stock market. 

Follow up

Oct. 17, 2021

I like to go back to work on investment of oil stock MRO. I just could not believe what I think about MRO as a stock to invest.