Thursday, May 5, 2011

Joy Global, Inc. (JOYG)

How many losing trades (in a row) does it take to shake off the effects of a 621% gain? I don't know, but it's more than five...

1. LONG the week of 6.9.03 at $6.33. My stop was $4.93, so the initial risk (R) on the trade was just $1.40. Stopped out and reversed to short at $45.65 the week of 7.3.06. The percentage gain on the trade was 621.2%, and the reward-to-risk ratio was $39.32/$1.40 = 28.07.



2. SHORT the week of 7.3.06 at $45.65. Using $64.91 as a stop, R = $19.26. Stopped out and reversed to long the week of 12.4.06 at $42.18. The percentage gain on the trade was 7.6%, and the reward-to-risk ratio was $3.47/$19.26 = 0.18.

3. LONG the week of 12.4.06 at $42.18. With the stop set at $31.81 my risk was $10.37. Stopped out and reversed to short at $39.93 the week of 2.26.07. The percentage loss on the trade was -5.3%, and the reward-to-risk ratio was -$2.25/$10.37 = -0.22.

4. SHORT the week of 2.26.07 at $39.93. The stop was $55.33, so R = $15.40. Stopped out and reversed to long the week of 5.29.07 at $54.78. The percentage loss on the trade was -37.2%, and the reward-to-risk ratio was -$14.85/$15.40 = -0.96.

5. LONG the week of 5.29.07 at $54.78. I used $42.00 for a stop, so the risk on the trade was $12.78. Stopped out and reversed to short at $44.58 the week of 7.23.07. The percentage loss on the trade was -18.6%, and the reward-to-risk ratio was -$10.20/$12.78 = -0.80.

6. SHORT the week of 7.23.07 at $44.58.  Our stop was $61.06, so that means R was $16.48. Stopped out and reversed to long the week of 11.26.07 at $54.95. The percentage loss on the trade was -23.3%, and the reward-to-risk ratio was -$10.37/$16.48 = -0.63.

7. LONG the week of 11.26.07 at $54.95. The stop was $40.38, so my risk was $14.57. Stopped out and reversed to short at $49.19 the week of 9.2.08. The percentage loss on the trade was -10.5%, and the reward-to-risk ratio was -$5.76/$14.57 = -0.40.

8. SHORT the week of 11.26.07 at $49.19. The initial stop was $74.43, so R = $25.24. Stopped out and reversed to long the week of 5.4.09 at $29.80. The percentage gain on the trade was 39.4%, and the reward-to-risk ratio was $19.39/$25.24 = 0.77.

9. LONG the week of 5.4.09 at $29.80. Using $17.74 for my stop, the R was $12.06. Closed last week at $100.95 with an $80.65 stop. The percentage gain on this trade is 238.8%, and the reward-to-risk ratio is $71.15/$12.06 = 5.90.

Bottom Line:
Winning Trades: 4 | 44.4% | $33.33/share avg.
Losing Trades: 5 | 55.6% | -$8.69/share avg.
Average Trade: Gain of 90.2% | $9.99/share | Reward-to-Risk Ratio (R): 3.55

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