Thursday, December 8, 2016
18 years in Wall Street, left after finding out it was all horseshit. Founder/ Master and Commander: iBankCoin, finance news and commentary from the future.
Joined Nov 10, 2007
14,865 Blog Posts

2012 Year End Review

For the second year in a row I blew massive gains towards the end of the year, underachieving. Following big years from 2008-2010 (60%, 90%, 60%), I was mired in mediocrity in 2011 with a measly 6% return and I am careening lower in 2012, up just 11%–down from +36%.

How did it happen and what the fuck is going on?

Answer: really unfortunate timing, greed, hubris, lack of resolve and stupidity.

That just about sums it up.

See you fuckers in 2013!!!

(mildly kidding)

I will now list my biggest losers by dollar value.

DECK– greedy fucker I was taking on this cocksucker, after knowing they were going to miss earnings. I was a deer in headlights. Chalk this one up to stupidity.

SWHC– the events at Sandy Hook elementary clearly had an adverse effect on this stock. It just so happened, SWHC was a 20% position of mine at the time of the tragedy, truly unfortunate timing to be long a gun stock.

VXX– I lose fucking millions in this stock every year, BUT NO MORE. I’d rather deep dry my head than buy this again. Stupidity.

SVU– my thesis here was to be long into some sort of buyout. To put it plainly, I got shaken out, and as a result, fucked myself–because the stock came roaring back shortly thereafter. Lack of resolve.

CPST– I held this stock throughout 2011, waiting for a turn around– but it never happened. Finally, I booked the loss in 2012. I have to chalk this one up to hubris.

JIVE– retarded timing on this one. Stupidity.

UA– This is my 7th biggest loss in 2012 and I only lost 4 points in the stock. I stopped out above $50, after realizing my timing was off. Although this loss was the result of greed and bad timing, it should be noted that I do not let many stocks fall too far before cutting losses.

Now for my biggest gains.

ANR– Going into the 2012 Presidential elections I executed a series of perfectly timed coal trades, ANR being my best.

CTRP– I executed this trade in the summer and it came and went in a blink of an eye. I had massive size in the trade and banked coin quickly, then vamoosed the fuck out of there.

WNR– had I held this stock from my basis of $14, I’d be singing a different tune right now. It was my #1 thesis trading call, bullish on refiners when no one else wanted to touch them. Well played.

NAK– This was another Romney play and I fucking nailed this for 80%. I just sold my last piece the other day for a pettily 18%.

GSVC– This was my original social media play, before all of the fucked up ipo’s. I played this like a BAUS, from $12-$18 and never looked back.

ALJ– another refinery play, banked coin and left for good.

YELP– This stock defied logic and reason, blasting higher as Facebook, ZNGA and GRPN plunged. I got in as low as $15 and liquidated, never looking back, north of $27. I was very adamant about the name.

EL– I leveraged up on this one and played it fast from $53-$59.

BZH– I sold this yesterday, playing it from the $14’s to $16.65.

Those were my biggest winners and losers. There were numerous other winners and losers, but none of great substance. I overtraded because I am paranoid as hell, thinking the market in on the verge of collapse on a minute by minute scale. And, I should NEVER play a stock into earnings, unless I am prepared to average down 20% lower. Clearly, I cannot continue this pattern of paranoid greed and stupidity, for it is a combination for acute failure.

My greatest strength is market timing. With the help of The PPT overbought/oversold algorithms, I’ve been able to time the market better than most. However, due to the individuality of stocks, coupled with my lack of broad diversification. I’ve had the unfortunate experience of booking losses, even when being right. Hence the inverse of “The Fly’s” mantra.

I don’t like the approach of owning 20 stocks, with 3-5% weightings, because it leaves one open to sheer fuckery should the market plunge–due to the difficulty in selling all of those stocks in a timely fashion.

Back in 2009-2010, some of my biggest winners were ETFs. I believe it is time for me to start implementing the use of the ETF universe (yet) again, one that I am keenly aware of and well versed. I maintain a complete database of useful ETFs inside The PPT and I will be putting them to use in 2013, utilizing my gift of market timing.

The market will always be unforgiving to those who bet big and bold. You might make some outrageous trades and come out the other end successful; but there will be a consequence to that success: hubris. You will try to repeat past successes and become frustrated when things go against you. You will believe yourself to be infallible, and when things go awry, you will bet bigger and lose. The gains will be bigger and so will the losses. Hence, you will live the life of an investor crackhead, dependent on a rush to fulfill your degenerate desires.

Walk away from that path in favor of a methodical one. Take my word for it.

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  1. Sebaco

    Merry Christmas Fly.

    Thank you for all of the updates, explanations, humor, insights and guidance throughout the year.

  2. JV

    Regarding quantity- I bought 85 or 86 stocks during May 2009 and now owning 7 feels heavy – I prefer to own three ( or less ) at anyone time.

    Merry Christmas. Excellent blog.

  3. Zero Dark Kitty

    Merry Christmas to you and family!

    Thanks for sharing your thoughts on 2012

    >NEVER play a stock into earnings, unless I am prepared to average down 20% lower.

    The earnings trap door has become a field of land mines, it’s up or down 3, 4, 5% with no rhyme or reason.

    Average retail investors must lose their mind when they buy solid companies and weeks later are underwater on earnings that are often fine in terms of growth.

    Not sure there is an answer on earnings roulette, but it is the source of my biggest losses this year.

  4. flyaway18

    Good post. Mr. Partridge is an ETF man and would highly recommend them over most single stocks.

  5. tuck9899

    Hence, you will live the life of an investor crackhead, dependent on a rush to fulfill your degenerate desires.
    a great gift by le fly

  6. The Eye-Talian Stallion
    The Eye-Talian Stallion

    Own one: VT, and be done with it.

  7. tm

    Saying that you had a lack of resolve in SVU is a little harsh, probably easy in hindsight. Should the lesson be that you’ll never close out of a losing position again? Or give yourself more room? Because then you may just as easily wind up taking more egregious losses on one or two stocks that never come back. You have to evaluate the process and the information you had at the time; not just the result, IMO.

  8. chivo

    The Fly is growing up before our very eyes.. so cute..

    Though for real, I hope these changes help your p&l as much as they will help your body and mind

  9. Grey Poopon

    Hi Fly, Very cool article. When you talk about your p/l % for a year are you talking about your personal account or an account that you manage? Merry Christmas man just signed onto the PPT/12631 for the year and am brand new to trading. Really have enjoyed these iBankCoin posts.

  10. TheRealPerformanceChaser

    Props for honesty Dr Fly and think you got something there with playing ETFs more based on market timing. So far looks like all the work in 2012 just got you in line with SPY returns YTD (or thereabouts).

    How are the 12631 proteges are doing? Any chance of them doing a similar recap?

  11. dk

    Well done. A lucid as well as candid reflection on a year’s work. Hope you have a great holiday.

  12. figesmalls

    What are your thoughts / projections on VHC? AAPL has to show the judge the Iphone 5 #’s by Jan. 15th, but what is the (gu)estimate in time frame that the judge throws his hammer down, not factoring in a deal between the two?
    Thanks for the insight.

    • heaterman

      Not the Fly here but my thoughts are that APPL slowing linking has much to do with the assumption by many that VHC will claim a portion of APPL’s earnings in the future.

  13. xxxHuggieBearxxx

    I have not done my year end final analysis, but i lost on every significant bet and every significant market turn.

    I had two great years in a row in ’10 and ’11, but got crushed in 12. Thus far, i have lost sliightly less in absolute dollars in 2012 than i made in 2011, taxes and fees included. But, i cut my portfolio in half this year and slowed down my trading, stopped trading futures, and thus my percentage loss was much greater.

    In many, many cases, the difference between this being another big year was “throwing in the towel” but a few days too early. I was short in Q1, and was told to “give in and it will feel better” as the market peaked at 1420.

    This occurred repetitively until i decided to “stick to my guns” late in the year, particularly with MCP.

    Needless to say a poor time to stick to ones guns.

    I bid 2012 a horrible farewell, and i expect 2013 to begin a giant bear market, for i will be a rich man otherwise. And i know things don’t come so easily.

  14. buylo

    Da whole problem is that you forgot how to trade using insider info. like you did in the golden years! But, a Merry Christmas should more than make up for it, in theory at least.

  15. ultramarine

    Dr. Fly, thanks for elaborating on your setbacks and successes for this year. Being candid in that fashion takes gigantic balls.

    Based on your idea of looking at ETFs for 2013, I ran a screener just now, on Fidelity Investment’s website, on non-leveraged and non-inverse ETFs and found the top 10 in performance so far this year as well as the bottom performers:

    ITB (home construction): +77.7%
    TUR (MSCI Turkey): +58.5%
    XHB (Spdr Homebuilders): +55.2%
    INCO (India Consumer): +49.7%
    TAO (China Real Estate): +49.6%
    BBH (Biotech): +49.5%
    EPHE (Phillipines): +45.9%
    FBT (Biotech): +43.4%
    PKB (building construction): +42.5%
    VNQI (US real estate): +39.4%

    The worst seven were mostly various volatility and short-term futures ETNs:
    CVOL, VXX, VIIX, VIXY, VIIZ, VXZ, VIXM (down -89% to -53%)

    Here’s a following few after that were bad performers:
    TAN (Solar): -41.2%
    KWT (Solar): -39.8%
    JO (Coffee…futures?): -39.5%
    CAFE (Coffee): -38.5%
    GLDX (Gold-related): -32.7%
    GRN (Carbon Emissions): -31.3%
    UNG (Natural Gas): -29.8%

    Note I pulled up about 1,187 results. I would be interesting to know the distribution of returns (and industries) for those in-between the best and worst.

    • Blind Read Ant

      TAN and KWT are 18 year olds bebes slathering their first sinning oils.

      Tanning oils I mean.

      Translation: buy IBM at 20, Not 180.

    • Zero Dark Kitty

      >The worst seven were mostly various volatility and short-term futures ETNs

      Some folks out there made a fortune shorting volatility the past 12 months.
      If we get a VIX spike to 25 this year, take the opposite side with whatever VIX ETF you like;
      It will be your best move of 2013.

  16. razorsedge

    fly, got a great tip on a peanutbutter stock, but the guy i got it from said not to spread it.

  17. Mr. President

    It’s been an interesting year for iBC. Thanks for what you do. Now let’s see +100% in 2013, monster-energy-soda style.


    Yo crackhead investors, you can’t be methodical…without meth.

    Best for 2013…

    • The Eye-Talian Stallion
      The Eye-Talian Stallion

      The market gains an average of +1.7% the year after an election.

      Market timing strategies will fleece investors who partake in such gambling.

      Gold will do well starting Jan 1st.

  19. omen

    2012 was an exercise in patience for me, as I watched, from the sidelines, The Fly and others here work their magic… I am dying to get back into the game, since I quick in Aug 2011, I miss PPT, but I don’t think I’m ready just yet…

    I do believe that PPT-driven algo trading is better for me than anything requiring my own contribution, since I tend to buy high and sell low, in panic… Letting the hybrid drive the trades would probably be better.. 🙂

  20. heaterman

    RE Sandyhook/SWHC/RGR

    Let’s hope that rather than being driven by the ever frothing and mindless media, people as logical as this guy are heard by the sniveling slimy wimps that pass as our politicians.