IDT Corp. (IDT) - 29% Loss in 4 Months
This is a trade rationale from a past trade for educational purposes only. For access to our current portfolio subscribe today!
We added IDT to the portfolio in July 2019 at a price of $9.70. The stock met our valuation and market cap criteria, and was among the top 50 micro cap stocks outperforming the S&P 500 over the previous 12 months.
The stock sold off sharply in March 2018 on high volume, and spent the next 6 months consolidating. An accumulation campaign began in October 2018 with several weeks of high volume leading to a breakout in July 2019.
We removed the stock from the portfolio in November 2019 at a price of $6.85, for a loss of 29%, as the company fell below our momentum cutoff.
Failed breakouts are an unfortunate reality of momentum strategies. Our rules-based approach allows us to get out of losing stocks quickly. IDT took over a year to recover, and we had another opportunity to buy in after the stock went through a secondary consolidation.
Ready to get started with predictive investing? Subscribe today!