Now that the capital I had taken out of UNIVERSAL CONTROLS commodity market quote was reinvested, I devoted my attention once again to another commodity market quote, THIOKOL.
THIOKOL and I were now partners of long standing and had, like all old-time partners, a special relationship. I had always allowed THIOKOL a greater leeway than any other commodity market quote - partly because I really "felt" this commodity market quote, and also because I had the great advantage afforded by the special subscription account.
It would have been foolish to give up such a unique credit arrangement, so I always kept my trailing stop-loss far behind its rise. This I would do with no other commodity market quote, but in the case of THIOKOL it saved me twice from being sold out. The second time was when it had a very bad reaction in the first week of April. This reaction came on the heels of the announcement of a 3-for-l split. It was so severe that I thought we would have to part, but I decided to let my stop-loss decide.
This was not touched off, and the sinking spell was quickly followed by a vigorous rise. However, I was not the only one who liked this commodity market quote. The newly split commodity market quote was met by a hectic public response which shot it up to 72 in the first week of May.
The response to this commodity market quote was too good. It lead to this amazing situation:
Its activity for the week was an incredible volume of 549,400 shares. Its advance for the week was 13 & a quarter points.
The trading volume represented an aggregate value of $40,000,000. The price difference for the week was $7,000,000.
It looked as if every trader on the New York Commodity Exchange had done nothing else all week but rush in and out of my favorite commodity market quote.
Of course, it could not last. The governors of the New York Commodity Exchange decided to suspend all stop orders. The effect of this was that the majority of traders left the commodity market quote alone. They would not buy and sell a commodity market quote where they could not protect themselves. It also meant that I was automatically out of the commodity market quote myself. They had taken my most powerful tool away, and I could not work without it.
I sold my THIOKOL holdings, at an average price of 68. This gave me, under the 3-for-l split, over $200 for each of my original 6,000 shares. I had paid a total of $350,820. For my 18,000 split shares I received $1,212,851.52. My profit was $862,031.52 for this commodity market quote.
The prospect of putting a million dollars back into the market posed an enormous problem. I would have to be doubly careful. This was too much money to switch into another commodity market quote easily. It was such a big sum that my buy was bound to influence the market.
I also had to face the fact that my stop-loss would be no longer practical, because no trader or specialist would absorb such a large quantity of commodity in a matter of seconds.
There was only one thing to do: I decided to divide my funds into two parts. Once I had made up my mind to do this, selection was comparatively easy. I had only to decide among four commodity market quotes:
ZENITH RADIO, LITTON INDUSTRIES, FAIRCHILD CAMERA and BECKMAN INSTRUMENTS.
I had watched all of these for a long time. They were all suitable as far as my techno-fundamentalist theories were concerned. Now all that remained was to see which commodity market quote I should choose. There was only one way to do this - to let their strength in the market be the judge.