UK Stockmarket 2009 and beyond

ses6jwg

Tullow, Aminex and Solo all up again.

Has Paddy been on the phone to his mates in Dublin? Gusher at Likonde-1?

We'll see, but I topsliced some profits to pay for a holiday (not making the mistakes I made with GKP - sold out completely too early, and Uniq - didn't sell any at 80% profit) now to let it run and see where we go.

tradetime

sham63 wrote: »

I'm another regular reader of this very interesting thread - also don't understand what I'm reading most of the time!

I have a very simlple approach to 'investing' - I buy the ishares FTSE ETF when I feel the market is down and sell when its up. This is simply to beat the return on cash so I'm happy with anything over 5% right now. I know I could be more active and possibly make more profit, but I'm quite risk averse - and I know that the FTSE won't issue a profits warning or go bust (well it might but then we're all knackered!)

I actually like that approach and recommend it to friends who want to utilize the stock market but don't want to do a lot of work, whilst it's true you sacrifice potential gains, the risks are low compared to stock picking, or more active trading. I personally think it is a perfect strategy for a S&S ISA and anyone who wants to DIY but doesn't want to devote a large amount of their time to studying either the markets or stocks, so good luck with that.

tradetime

Tricky week, markets once again defied gravity in the main which emphasizes the risks to playing the short side for anything more than intraday. An interesting development is that the most recent swing high (the lower high on the dailies) has been broken Possibly options expiry played a part as we did appear to remain near the sweet spot, only time will tell.

SPX managed to get above the 1105 resistance level to complete a 62% retracement of the move down, which coincided with the 50 day moving average at 1109.
Technically we are still in what I would consider a modestly bearish formation which as I've said before would change with a sustained move back above 1115ish, a level we are very close to now, but I don't think the work on the downside has been completed yet. I personally think we get some sort of pullback here, as such the intraday high on Friday 1112 (cash) provided a low risk swing short entry with a target around high 1080's - 1090.

A pull back in the FTSE of similar magnitude would equate to around 5225

US$ pulled back in line with the equities rise after fulfilling the first flag target at 81.3. I still expect 83 over the coming weeks, possibly as high as 83.7, if we can overcome the resistance between 81.3 - 81.8 then the rest of the trip could be quite quick.

ses6jwg

sham63 wrote: »

I'm another regular reader of this very interesting thread - also don't understand what I'm reading most of the time!

I have a very simlple approach to 'investing' - I buy the ishares FTSE ETF when I feel the market is down and sell when its up. This is simply to beat the return on cash so I'm happy with anything over 5% right now. I know I could be more active and possibly make more profit, but I'm quite risk averse - and I know that the FTSE won't issue a profits warning or go bust (well it might but then we're all knackered!)

Thats a good strategy and I may start doing this in the new tax year.

Only problem I can see is you are effectively trying to catch a falling knife as who knows if the FTSE will recover quickly?

Sure the few pull backs we've had in the last 6 months have quickly been bought up but I suppose you could get caught short.

sabretoothtigger

I dont see it would be that dangerous compared to holding cash in a bank account which is fairly obviously not going to keep up with inflation most people would agree

The danger is you buy at the top and have to hold for five years only getting dividends back because you judged wrongly. I did this myself once and it was ok in the end, I was glad to have chosen all share not ftse100 and also reinvested the dividends so in fact I had no income during this time


There is also the secular bear argument. ie. gold dropped in price for 20 years and quite obviously is doing the opposite now and vice versa stock prices

I would argue many companies are international and able to capture some world growth. I see currency weak and companies slightly better overall. It might be after all the deductions for inflation that nothing is made with Sham63's policy but I dont anticipate great losses by being invested imo


Personally I rank Pacific, Indian or latin america stock indexes over UK. I invested 2001 ftse like I said, I also thought about India at that time, the difference since then was India trebled, opps!





Another lesson I learnt was where at all unsure, save something back to invest later. In 2001 I did a lump sum and got it wrong obviously, but in 2008 I used a regular investment for 50% of the total.
I took out pacific tracker in May 2008 (I guess I suck at timing ), massive losses ensued but thankfully I eventually almost doubled my money thankfully due to this process



Finally if you still like uk best look at FTSE 250. I think thats the best one, 250 is exclusive of top 100, ft350 is inclusive

bobbyj_2

sham63 do you use XUKS,SUK2 and LUK2?
Obviously a bit more adventerous for ETF players.

sabretoothtigger

LUK2 gained 8% last week, thats a sweet gain for just an index trade.


The return on those things is not linear though (leveraged etf is for traders) , more luck then average is required but certainly appears nice whenever markets move in just one direction and they did last week

This last week was pretty surprising to me as I did not expect this strength and it shatters my theory of a weaker market after march trend was lost. http://img714.imageshack.us/img714/3082/ftseweek.jpg

I did predict dollar strength and cable weakness quite well but this did not correlate to equity markets falling as more often then not has been true recently.

I guess this was an options week thing but I wont know till march arrives most likely. Didnt citigroup announce something march last year, are they scheduled to do so again soon?

bobbyj_2

why i don't trade the indexes, the suk2 is good on those rare occasions when the markets risen alot and quickly, still prefer trading stocks though.

tradetime

From what sham63 has posted,

This is simply to beat the return on cash so I'm happy with anything over 5% right now

I'm quite risk averse - and I know that the FTSE won't issue a profits warning or go bust

combined with what he actually describes doing, then leveraged trackers would be a very bad choice of instrument. Leveraged products are designed for relatively active, aggressive traders who understand risk control and are willing and capable of taking a loss when their entry is wrong. They were, by their design, never meant to be held indefinitely, "until they come good" as is a common practice amongst inexperienced traders. They are also quite thinly traded which constitutes a risk if you get sucked into holding onto them.

I do agree for active traders they offer great opportunities, though I am unfamiliar with these particular products and how they perform intraday, ie; since they are thinly traded, what sort of spread they have.

sabretoothtigger

Sold some of IGG and bought some TEF / TNE5 in euros. Across currencies holding shares becomes more complicated but Ive tried to figure out all prospects and I see having some euro as a good thing compared to just plain sterling, ironically we have been doing well vs euro for a few months now but have been sideways for a couple weeks.

I see a possible breakout and improvement in euro vs sterling, I estimate this to occur during March but near term I expect Euro may decline in worth still and also TNE5 could fall as pricing was not ideal however I remain mostly uninvested and I consider this a reasonable hedge. Hopefully I got the long term prospects reasonable right on TEF, they operate O2 mobiles and are involved internationally most notably the largest owner of a major Chinese mobile operator among other divisions.

They seem quite aggressive (hence the yield / risk premium ?) , today they were refused entry to the nationalistic Italian market which could be a blessing in disguise.

_~His_Holiness,_the_Dalai_Lama wrote:

"Remember that not getting what you want is sometimes a wonderful stroke of luck."

I looked at the accounts and forecasts but Im not an accountant, at some point I must just pray I have judged right
They seem to be quite highly geared which is still ok so long as growth continues




Iam short the SP500 and see dollar strength as a trend since December 9th continuing. Might be wrong but it seems to have proved true on a number of occasions since then so I drew in a channel, uptrend

Other international shares I hold are Intel which Ive considered selling due to dollar strength its performed reasonably. I decided not to though it could fall in value, I dont want to shuffle these things around when I expect a higher price longer term.
I will consider a sale if I see a major failure in dollar index forming but not today