"Even a broken clock is right twice a day."

― Stephen Hunt, The Court of the Air

There are times when every investor has to look long and deep into a mirror and determine whether a well-thought-out strategy is actionable or whether it is simply an ad hoc "hunch," barely worth chasing. With regard to silver, this is just one of those times.

In 2003-2004, I was stopped out four times under $5 per ounce trying to establish a 10-lot futures position in silver (50,000 ounces), which, at the time, demanded US$18,000 in maintenance margin. When I finally threw in the towel, my $18 grand worth of "dead presidents" was worth slightly less than $6,000.

At the time of my decision to abandon the trade, I remember a sense of impending doom as, with great regret, I returned the funds to the (joint) bank account. Days later, when the losses were detected by an appropriately suspicious spouse, one could hear the screaming of insults miles (if not counties) away. As embarrassing and emasculating as that was, the addition of insult to injury was aided and abetted by the cost of a chiropractor due to weeks of punishing couch-sleeping.

Further exacerbating my agony was silver, almost immediately upon my departure (and as if it had eyes), deciding to break out through $5 and proceeding to triple. Staring at the quote screen, slack-jawed and near-comatose, I watched with the same sense of disbelief one has when observing a slow-motion train wreck as silver—my precious silver—tapped $50 in 2011. Without including the possibility of parlaying the 10-lot to something larger, the original position would have generated a $500,000 profit or something close to a 2,700% ROR. Risk management at its very worst or stepping over a $50 bill to pick up a nickel.