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EnigmaDude (98.05)

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October 21, 2009 – Comments (1) | RELATED TICKERS: CKSW

Some stocks have predictable trends based on recent history.  One of my top picks this year has been Click Software (CKSW).  I recently read how in each of the past 6 quarters the stock has run up prior to the earnings report and then drops on the news (or the next day). 

Fortunately, I was able to take advantage of this bit of historical knowledge.  I sold my shares at $7.75 yesterday and today their earnings report came out.  Although they reported record profits and forecast inline with estimates for next quarter, the share price plummeted nearly 20%.  I added more shares today at the new, lower price of $6.40.

I realize that this is a risky trading strategy, but it has been working effectively for some stocks.  I think the bigger players in the market (i.e. hedge funds) employ this strategy on stocks like FRE. I would not advise this strategy for most people - only those willing to take big risks for big rewards.

Anyone else have another example they would like to share?

1 Comments – Post Your Own

#1) On October 21, 2009 at 8:58 PM, ChetGib (< 20) wrote:

I tip my hat to you in terms of playing it the way you have.  You are a step ahead of me in terms of experience and sense.

For me . . . I bought Click for the long term based on criteria for growth.  That potential does not go away based on 1 days reaction to next quarters performance.  If I had the cash, I would buy more now.

 

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