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Expanding Horizons

1/3/2018

If you have been reading you know I made a nice profit right at the end of last year.  Since I am nowhere near my goal of $2.5 million these profits need to be reinvested so they continue to grow.  I decided to wait a few days because I was very excited after the sale and wanted to give myself time to calm down.  Emotional investing is never profitable.

First I looked for something that was going to be on its way up.  I found Rite-Aid (RAD) was having trouble in 2017.  It was near the lowest level it had traded at for the year and my guess was it was bottoming out; from there the only way to go is up!  Both Walgreens (WBA) and CVS (CVS) have higher PE (Price to Earning) ratios and are worth significantly more.  WBA & CVS are each worth about $80 billion, while RAD is only worth about $2.2 billion, this told me there is a real chance of a full buy out from one of the bigger players.  Figuring I had 2 ways to win, I made a purchase.

I bought 400 shares of RAD for $2.18 each, total cost was $878.95.

I wanted to further diversify my holdings in the cannabis industry. CV Sciences, Inc. (CVSI) manufactures and sells synthetic Cannabidiol products to pharmaceutical, beauty and specialty food manufactures.  I was on its way up with many stocks around the first of the year.  In hindsight, this was not the best buy opportunity, but time will be the judge.

I bought 1,270 shares for $0.6235 each, total cost was $798.80.*

One stock, SGMD, which helped me turn a nice profit has continued its climb.  Waiting for a pullback I set an automatic purchase of 20,000 when I dropped to $0.16 again.  I watched as the stock doubled my last cash out point to $0.40!  I got scared (emotional) and decided I wanted to get back in before it jumped to $1.00.

I bought 5,000 shares of SGMD for $0.40 each, total cost was $2,006.95.*

 

*Followup:
Typically you want to buy when the price goes down and sell when the price goes up.  I made 2 errors today, I bought 2 positions when they were on their way up.  Both stocks pulled back in the following days.  They may still become profitable but I left money on the table today.

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