All the best CLV

I first bought CLV in October 2013 during the Fonterra milk scandal.

My main reasons at the time were:
- The scandal should be temporary
- CLV had no debt and had lots of cash in the bank
- When the market recovers, CLV should be able to rejoin in the boom happening in the baby milk powder market

A few months later, I topped up much more when it was revealed that the "contamination" was a false alarm. My thinking was since it was a false alarm, then there shouldn't be any difficulty in picking up old orders.

Unfortunately, this didn't happen. Furthermore, CLV was then negatively affected by the falling AUD and intense competition, which affected its margins.

The profitability pretty much collapsed to nothing in 2014 & 2015.

I had to endure watching an 80% collapse in the share price.

And then in late 2015, out of the blue, there was the announcement of the Premneo agreement. My thinking was, the ex-CEO of CSL, Brian McNamee, who now runs Premneo, will not enter into this agreement, if he doesn't believe in the likelihood of positive outcome of the trial.

CLV rallied on the news, and my 80% loss very quickly turned into a small profit.

Instead of getting out, I decided to hang on and hoped that the positive trial result will spark CLV's price even higher.

Well, this morning's announcement basically spoiled the party. There was no positive outcome and the Premneo agreement had been terminated.

And I have decided to exit at an overall loss of around 27%. Had I exited at the open, I would only have lost 13%. I was out and about doing my shopping and didn't even realise that CLV had released an announcement.

This experience reminded me to stay within my circle of competence. I don't like investing in companies where I have to look out for announcements which have the potential to move the share price significantly either ways.

The last few months when CLV was trading above $0.50, I could have got out at a nice little profit. But no, I was greedy and wanted more. Actually the more I think about it, it was more like, since I was already nicely set in the stock, I was scared of missing out the big share price jump that will surely happen when the positive result of the trial was released. So at the end, if was basically a big punt and in this instance the gamble didn't pay off.

Normally, I wouldn't even put a small amount of dollars in any kind of bet. But somehow, I was making a bet using an amount way bigger than a rational me would put on a horse.

Just when you think you know about the market and are confident of your ability, the market always has its ways to put you back in place.

Thank you Mr. Market for the expensive lesson. For me, the journey with CLV ends today, all the best CLV!