Huge loss and quick turnaround

Today, my portfolio reached all-time highs with me finally breaking the P400,000 mark. I’ve been gunning for that mark for the longest time. I had in fact been frustrated because I thought I should have had broken the half-million mark by this time actually. But stocks being stocks, volatile and unpredictable, I had to deal with losses early this year so my progress was somewhat slowed.

My biggest and most painful story this year was San Miguel Corporation. I had attended one of their roadshows a few weeks back and had gotten convinced that it would be a very good investment.

I was right but my timing was wrong. Awfully wrong. I had bought into the stock just when the speculation on it was at its peak. But I didn’t realize that until it was too late. The stock was pushed high because of speculation on its then rumored additional stock offering. When the final price of the offering was announced, which turned out to be 110, the price of SMC which was trading then at around 150 or so shot back down to 110 and even went as low as 107 at one point.

I lost a lot of money on one single day – P45,498 to be exact. I nursed my losses and managed to salvage some gains by buying SMC below 110 and reselling every time it strengthened. But the damage was just too huge. I held on to a core SMC position and decided to shift my portfolio to more promising prospects.

This was about the time when Gus Cosio talked to me about Lepanto Consolidated Mining. He was so convinced of the stocks underlying value and potential that his enthusiasm was simply too contagious. I ended up buying huge positions on the stock.

My timing on LC was as good as my ill-timing on SMC. So much so that as of today my LC position has netted me a 43% growth in just 70 days of holding the stock and today, LC continued its advance with a 10% single day gain. I expect it to continue tomorrow so these are exciting times for me.

But back to SMC, it has finally found traction and slowly built up volume and price quietly. It now trades at around 130 with many analysts placing its real value at around 170. For me, I believe SMC will be a very strategic long-term play and should be an important core stock in my portfolio. I can imagine SMC reaching 300 or more over the next two years or so.

As for LC, I am letting my profits run, and enjoying the ride.