Position Cost Averaging

Hi PCA Fans,

I finally had a chance to update my PCA again today and what do you know… more buying to be done. The purchasing department has been working overtime and building quite an inventory of low priced shares.

We started this model portfolio in August and so far this will be the 20th buy order into a falling SPY.

There have been 22 buy orders in the recent market turmoil and that is just since august and only in SPY. We still have about 20% of our portfolio value in cash and we have lowed our average cost per share considerably. We can still buy into more weakness and get even more bargain shares.

Here are the orders from today for QQQQ

The QQQQ holding has had 13 buy orders and we still have 21.7% of our holding in cash. So far so good. Cost per share is down about 5 bucks and we are holding 464 more shares than we started with.

Here is the buy orders on IWM

Three trades today in IWM and so far that makes 15 buy orders. We still have 23.8% cash and we are holding 432 more shares than we started with.

Here are the buy orders on DIA

Two buy orders today in DIA and that makes 15 so far. We are holding 432 more shares and our cost per share is down about 9 dollars.

Here are the buy orders on SMH

Two buy orders on SMH as well and now the cost per share is down over 5 bucks from the original purchase. We are also holding 386 more shares after 15 buy orders.

Here are the trades from XLF

Two trades today in XLF, now we are holding 326 more shares with an average cost down over 4 dollars each. The 10 buy orders so far leave us with 16.6% cash left to go.

Even a buy order on GLD, I have been waiting for this one.

Finally one trade in GLD today and its the first one since August, Interesting that we started this holding with a 30% cash reserve to begin with because Gold was so beaten down at the time. Since then it has held up well in the market chaos.

That’s all for today.

Hi PCA Fans,

I updated the model portfolio after the close today and got a buy order on SLV. Here it is…

Ok PCA Fans,

When congress voted down the "bail out bill" we are now getting a fist full of buy orders.

We are getting buy orders on SPY and QQQQ and SMH and XLE and QLD all on the same day.

PCA is allowing us to strategically deploy this cash into a weak market and will also signal us to sell these shares when the markets come back in line.

This is not anything more than pure risk management.

By being most exposed to the market at the bottoms you stand to gain the most when a rebound occurs.

Conversely, by being fully exposed at the top of a market cycle you are assuming the most risk. Now we are going to put a little more capital on the table.

Here are the buy orders we got today…

Here is a good learning opportunity for those new to PCA…We got 3 buy orders on SPY today. The lesson here is that by using the occasional update method I am able to take better advantage of bigger moves in the stock in this case SPY.

Here are the 3 trades…

Notice how the size of the orders decreases

And decreases again.

Of course you would have "bundled" these orders into one transaction at your actual brokerage but for the purposes of running this model portfolio and blog I am including them separately and will account for them that way as well.

As a side note… I have NEVER seen three trades in a row before… and today it happened twice… Read on.

Here are the trades for the QQQQ and once again we are getting a multiple order. only two on the QQQQ so here they are.

Now we are moving on to the sector ETFs and we are getting one buy order on the SMH

We are also getting a buy order on XLE

And finally we are getting another triple buy order… this time on the QQQ.

WOW, I have never seen anything like it.

Thursday Night we are doing the third seminar with our special guest Jeff Webber on how to build a diversified portfolio and we’ll talk about using PCA and LEAPs for the most conservative use of leverage I have ever seen… DO NOT MISS IT!

Hi PCA Fans,

Today I got a sell order on the GDX, that’s the Gold Miners.

There is where we are now…

Here is the next trade advice.

Hi PCA Fans,

This week we got another big round of buy orders in the model portfolio.

Here are a few that came in on Wednesday the 17th.

BUY SPY 18 shares at 117.00

BUY QQQQ 24 shares at 40.25

BUY SMH 14 shares at 24.70

BUY XLF 20 shares at 18.25

BUY QLD 19 shares at 56.75

BUY XLE 12 shares at 61.25 (The 16th)

This is exactly what the PCA software is for…

"Buy from the Scared… Sell to the Greedy!"

The next PCA Seminar is coming soon, keep an eye on your inbox for the exact date and time.