# DrBourse General Help for Beginners



## DrBourse (8 August 2021)

All 3 “DrBourse Help For Beginners” forums contain a series of “RANDOM POSTS” on subjects and items that may be of interest to beginners…

My intention is to lodge numerous posts to start with, then enter into “CONSTRUCTIVE DISCUSSIONS” that are geared toward assisting with beginner’s education in the various aspects of Share Trading….

These posts are not intended to be in any logically presented format….

Experienced Traders will gain little from my posts….


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## DrBourse (8 August 2021)

Sorry, but I do not provide Buy/Sell Reccos - I have never suggested that ppl should buy “a particular stock”, that’s not my style – I only ever get involved if someone throws a Q into the room, or when someone asks me a direct Q - When asked, I always put my TA or FA thoughts into the arena, obviously it’s open for criticism, that’s everyone’s prerogative – the only other information I put forward is my “Educational Help”.


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## DrBourse (8 August 2021)

Share Trading is such a complex subject that no “one Seminar” could possibly cover all aspects - it would take far too many days or months, and be far too expensive for any individual to attend - remember that seminar teachings may not be exactly correct, they usually all have a ‘hidden agenda’ that is usually related directly to what their individual business needs to sell you (eg: a Software Trading Program, or a periodical publication, etc, etc.)…..

Personally, I’m not a fan of those expensive seminars - but obviously it’s a very personal choice - remember that TA & FA are often interpreted in differently by each individual - also All the information they explain to you during those courses is available from other sources…..

It just involves a lot of individual discipline and effort…..


Share Trading is a very intense occupation - traders are continually learning something new every day - so why not learn everything by yourself, starting NOW……


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## DrBourse (8 August 2021)

There are a lot of Trading Systems available, “Individuals” with their own particular slant on the Market Mechanics.... Guys like Fibonacci, Gann, Lincoln, Nison, Gramza, Elliott, Buffett, Ben Graham, Williams, etc, etc, - I think anybody wanting to make something out of this Trading Profession needs to at least understand what these guys are saying.... Having said that though, I think anyone that relies solely on any one persons ‘Theories’ is crazy.... Take it all ‘on board’ then mould the best bits into your particular style of Trading/Investing....

A lot of people are relying too much on things like the ABC Trading System, Gann, Elliott etc - none of us expect those systems to be exactly right every time, it's just not possible, IMO those theories are interesting but not always correct - same as my Indicators, I occasionally read them incorrectly – use the info that they produce, take notes, then add a bit of commonsense to the mix & ALWAYS DYOR.....


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## DrBourse (8 August 2021)

In my opinion any bit of Information is valuable and significant - if you omit the bits that you personally don't like you won't last long – HOWEVER some traders use only Market Depth, some traders use Volume & Market Depth, some others use Financial Data only, some others use Technical Analysis only, etc, etc, and they all do very well at this profession, because they understand what their chosen method of research can tell them.


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## DrBourse (8 August 2021)

IMO we, as traders, need to read as much as we can such as newspapers, Broker & Analyst Reports, etc - BUT the trick is not to just read and try to understand the reports, but to 'work out what the sheep reaction will be to those reports etc' - then we need to trade off that understanding of what the sheep will do.


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## DrBourse (8 August 2021)

Trading Strategy ---- I occasionally adopt an approach similar to Fund Managers, etc when buying into this Market ---- DURING THE FIRST HOUR, Watch, from the Opening, for Stocks that Rise then Fall ---- DURING THE NEXT HOUR, Only Buy into Stocks that Rise 2 Ticks above the First Hours High – Stop Loss will be the First Hours High Point. ---- This system has worked quite well in Past Volatile Markets ---- It's just something for ppl to think abt --- you would need to do your own backtesting on this strategy.......

I have never suggested that ppl should buy “a particular stock”, that’s not my style – I only ever get involved if someone throws a Q into the room, or when someone asks me a direct Q - When asked, I always put my thoughts into the arena, obviously it’s open for criticism, that’s everyone’s prerogative.


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## DrBourse (8 August 2021)

In this Profession the idea is to Trade when there is a Trade to be made, and even then, you should 'Play the Trade' (like playing a Fish), you should NOT trade the $$$'s - get the trades right and the $$$'s will automatically follow, buying stocks just because you have to 'Make Money' is the wrong reason to buy ... Unfortunately, there are a lot of ppl in that situation - they are usually the ones that get burnt.

One of the problems traders continually have trouble with is, "To Sell, or not to Sell ???" - Traders should as themselves one Question - "If I did not own this stock right now, would I buy it", - If the answer is that you would buy, then you should probably hold - HOWEVER, if the answer is that you would not buy now, then you should probably Sell ASAP...... BUT DYOR.

This is not a game – this is a Profession - it is called share trading not shareholding.


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## DrBourse (8 August 2021)

HOW WILL YOU PLACE YOUR BUY/SELL ORDER’S ?

“Buy/Sell @ Market” means you will immediately get the Nr of Shares that you want, the main problem here is that there could be some slippage (either way)..... This option can only be used DURING TRADING HOURS.....



“Buy/Sell @ Price” means that you may NOT get the Nr of shares that you want for that price, in which case you would need to Amend your order to get the remainder of your quota.... basically Traders like myself always use @ Market as we need the shares NOW because we may want to sell them in a few minutes, we need to turn our money over quickly..., Investors or longer term traders usually use @ price....



“Buy/Sell @ Good for Day” means that your order can only be processed TODAY, basically Traders like myself always use @ Good for Day, as we need the shares NOW because we may want to sell them in a few minutes, we need to turn our money over quickly..., Investors or longer term traders usually use @ Expiry Date....



“Buy/Sell @ Expiry Date” means you nominate the future date you want your order to expire, this way you may accumulate the shares over a period of time, right up to your nominated Expiry Date.



Here is an example of WHY I don’t use “Buy/Sell @ Expiry Date” – Let’s assume your Buy Order is placed, but only partially filled, at the end of the day you will receive a Trade Confirmation for the shares bought and for the standard Brokerage Fee, if your order completes tomorrow you should not be charged additional brokerage, and you will receive an updated Trade Confirmation... The only scenario that you will be charged extra brokerage is if the total order value goes to the next brokerage level, that is to say if the total order value exceeds $10,000.... If your Buy Order was to expire and you placed a new order, you would then need to pay a second brokerage amount as it is a new order. If you are worried your order may expire before it is fully executed, you can amend the expiry date of your order online.


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## DrBourse (8 August 2021)

For Newbies and anyone else trying to relate the Overnight DJIA to our "Market or Individual Stocks", here is a method To calculate the ASX200’s rise or fall for the day, _it's never perfect_, but it is usually pretty close, it's what most of the so called "Experts" use each morning here in OZ........

Use last night’s Dow Jones figure, Divide by 3, then Divide by 2.- SO - IF DOW JONES was UP by 190, then our ASX200 should be UP by about 32, that is, 190 divided by 3 = 63.33, then 63.33 divided by 2 = 31.66......... there are other options to this formula, but I will let the mathematicians of this world show them to us.

SO.......

If BHP was up by $2.41 on the DOW, we would divide $2.41 by 3, then divide again by 2 = 0.4016666c, so our ASX BHP should be up by about 0.40cents.........

There are various ways of calculating/guessing how our Market or Individual Stocks will react to the DOW's results each day, Remember, as there are several other factors involved, it's never perfect, but it is usually pretty close........

Other Factors you need to add in like our Domestic Economic Climate, and our relative Australian problems and Announcements that may occur between the DJIA Closing time, and the End of Our Trading Day, then obtain news of any of those factors that occurred in the "US of A" during their Trading Day..... Not easy accessing all that info, but can be done with the help of some American contacts, in other words I try to get the American version/explanation of What Caused the Rise or Fall....

It's not an EXACT Science, but it usually works for me....


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## DrBourse (8 August 2021)

As a Technimental Trader (I rely on 60% Fundamental’s AND 40% Technical’s), I just love the Stock Market Players with the “I DONT BELIEVE CHARTS” philosophy…..

They all make my job so much easier – my Bank Balance Applauds them all, as we Technimental, or Technical Traders, benefit from their uneducated outlook on this profession……

Then there is the argument of Financial Analysis vs Technical Analysis - Remember Balance Sheet Financials & Financial Analysis are issued, “As At a certain Date”, so as time progresses it becomes less relevant - but Technical’s & Technical Analysis (which = share price movements) actually reflects CURRENT NEWS, CURRENT ANNOUNCEMENTS, CURRENT VALUES & CURRENT MARKET SENTIMENT - your stock selection should be based on both FA* & TA, not one or the other……

TA was created a thousand years ago to help Fundamental Players understand exactly what was happening in the real world of Share Markets - I think it began in Japan & China, then during the Tulip Boom they added some more EASY TO UNDERSTAND INDICATORs & CANDLESTICK info for the Fundamentalists to follow……

To all the unbelievers out there - PLEASE keep the flag waving …..


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## DrBourse (8 August 2021)

This Post relates to what I call, "Minor Irritants".

Volume Weighted Average Price - VWAP is a trading benchmark particularly used in pension plans. It is calculated by adding up the dollars traded for every transaction (price times shares traded) and then dividing by the total shares traded for the day. The theory is that if the price of a buy trade is lower than the VWAP, it is a good trade. The opposite is true if the price is higher than the VWAP.......

VWAP & VWMA are not as popular as you may think.....



"Minor Irritant" Traders use VWAP to their detriment - Serious Traders & Technical Analysts have several other Volume based Indicators at their disposal, A Weighted Moving Average set @ 1 is almost the same as VWAP (htc3), But a WMA setting of 2 or maybe 3 provides a safer option.....

Those other Volume based Indicators give the Technical Trader a big advantage, because we know what the Minor Irritants next moves are before they actually do.....

The following is a copy from Investopedia.com -"Volume weighted average price (VWAP) and moving volume weighted average price (MVWAP) are trading tools that can be used by all traders to ensure they are getting the best price. However, these tools are used most frequently by short-term traders and in algorithm-based trading programs"........



Option Traders, Algorithmic Trading, ABC Swing Traders, FTMC Traders, Direct Market Access (DMA), VWAP Strategy Traders, etc, are all classed as "Minor Irritant Traders", purely because they are a Minor Irritant to serious ST & LT Share Traders.......



TWO of the many problems facing the "Minor Irritants" are:- .....

1- The speed of order execution, an advantage in ordinary circumstances, can become a problem when several orders are executed simultaneously without human intervention…. Recent past “flash crashes” have been blamed on algorithmic trading......

2- Another disadvantage of algorithmic trades is that liquidity, which is created through rapid buy and sell orders, can disappear in a moment, eliminating the chance for algo traders to profit off price changes. It can also lead to instant loss of liquidity. Research has uncovered that algorithmic trading was a major factor in causing a loss of liquidity in currency markets after the Swiss franc discontinued its Euro peg in 2015......

Don't really want to list the other problems that Minor Irritant Traders have - I need to keep my advantage over them....


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## DrBourse (8 August 2021)

Sheep are, in my opinion, people/traders/Mums & Dads etc, that do not understand much about the ASX and how it works, they blindly follow a Favourite Stock for no valid reason, they blindly follow Chat Room Ramps without doing their own research, they blindly buy on the 'Taxi Drivers Tip" without doing their own research - they blindly follow whatever Stock is suggested without doing their own research...

IMO we, as traders, need to read as much as we can such as newspapers, Broker & Analyst Reports, etc - BUT the trick is not to just read and try to understand the reports, but to 'work out what the sheep reaction will be to those reports etc' - then we need to trade off that understanding of what the sheep will do.


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## DrBourse (8 August 2021)

We all went through the trauma of trying to Locate a Software Trading Platforms – looked at dozens of Software Trading Platforms, most were far too expensive. You need to work out what level of access you need - then keep shopping for the best value for that ‘level of access’. I guess it depends on how much you want to pay per mth, and what type of Data Feed you want or need... The actual Software Programs can cost many thousands of dollars (most range between $100 to $900) - Live Data can cost hundreds p/mth – End of Day Data costs $30-$50 p/mth... The idea with any Trading Software is that “The Individual must Drive it”. So, the biggest thing to watch out for is what’s known as “Black Box Systems”. Any software pre-programmed to produce decisions for you is known as a ‘Black Box System” - They are Software Programs that have “Set, and Unknown” formulas within, that identify certain signals, like Buy & Sell Points, or Chart Patterns, ABC points, etc. Some are Good, most are pretty useless and you end up paying for a feature that does not really work. Brokers, Fund Managers & Bankers do not use them, so why should we use them. You need to gain the Technical & Financial knowledge, then apply that knowledge to your chosen software – what you don’t need is some software package telling you what to do. Then you have to consider just ‘how user friendly’ each Software Platform is...Incredible Charts is Basic, has most of the Bells & Whistles, AND IT’s FREE for ‘next day data’... www.incrediblecharts.com ..... another is TradingView – Track All Markets it’s also FREE for 20 min delayed data ..


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## DrBourse (8 August 2021)

Had a few people recently ask for my thoughts on "Stock Scanning Software"....

After a short discussion with each of them I realised they were approaching the Scanner with the wrong information input....

Most were just punching in random parameters, and getting garbage results....

SO, thought I would show how I approach setting up of Scan Parameters......

This does not work for all Software Scanners, nor does it work for all types of stocks, but with a little bit of tweaking, it usually produces the goods.....

The following snapshots are from my old Seminar days, but the theory will still apply in any economic environment....



My approach is shown in the first snapshot, in that I look at a Basic Candlestick Chart, and then decide where I think Entry Signals should be given by the Scan Software, then I experiment with various Scanner Software Settings until I get a result that is confirmed by several other independent Indicators, the Scan results are shown in the second snapshot.....

Remember that different stocks react differently to different indicators.... So this approach is suspect with a minority of stocks, particularly "Penny Dreadful Stocks"....

Remember that this approach works for me because of my knowledge of Indicators, anyhow I thought it may be of help to someone....


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## DrBourse (8 August 2021)

If you are not competent with your own Analysis Skills, then you may pick up some clues by trying to get some Free Analysis from the following sources….

Here are a few suggestions for any Suicidal Newbies that want to play in the ASX Share Trading Sandpit... ….



1/.. Select a Stock (by whatever means) that you think you may like to buy….

Then check that company’s list of Top 20 Shareholders…..

Those Top 20 have obviously done their analysis and are comfortable holding your chosen stock….

It would be good if those Top 20 players were reputable companies such as Banks, LIC’s, etc….

I would *not* be happy if the Top 20 were say, Family Trusts or individuals I did not know anything about….



2/... Check your companies’ announcements for “Ceasing to be a Substantial Holder” or “Becoming a substantial Holder” announcements… That will tell you who, ‘in the know’, is Buying/Selling your company’s shares….

If the Banks etc are selling, then there must be a good reason, good enough for you to take notice of, and maybe not to proceed with your selection….

On the other hand, if the Banks, etc are Buying, then maybe you are on the right track….



3/… Do NOT however be bullied by anyone’s particular pet trading system….



4/.. You need to understand the effects of “Algorithmic Trading Systems” and “Short Selling” etc but you do not need to be frightened by them – Once you understand the world of Share Trading you will realise there are ways of avoiding those Minor Irritants…



5/ Finally… Remember that it is your money – You must make your own decisions – hence the usual disclaimer - DYOR…


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## DrBourse (8 August 2021)

The Topic here is Mergers & Takeovers.....

IMO, the first thing to look at is the history of the Predators and Who Else is involved as Backers - How successful have they been in the past, some have a great record of success, others have a great record of failures - Then I would look at the Financial Standings of Prey, and Predator as totally Separate Entities - Then I would look at which one of the 2, Predator or Prey is best suited to the Merger - that is, would the Prey be more likely to drag the Predator into Oblivion, or is it Probable that the Predator would end up with a Bigger, Better & more Profitable Business - Also I would need to obtain all the Gossip on the likely Merged Board Structure, ideally there would be a minimum of 75% Predator Members on the New Board, and 25% (Max) of the others on the New Board - Reasoning for that is pretty obvious IMO, don't really want anything or anyone from the Failed Company to carry too much sway within the New Enterprise......



Then after all that I would look at how the New Business Plan intends to deal with any lingering Prey Problems, Will they Break up, and Sell the Non-Performing parts of the Prey Company, or will they try to maintain all aspects, if they decide to keep everything from both sides will they have enough Resources and Internal Knowledge to do what needs to be done - that would then lead to Evaluating the proposed Merged Company Financials......



Mergers very seldom start with a SP Spike, so after a reasonable time, Analysing TA would come into play....



So with all that ammunition you should be able to make an Informed decision on the Merged Company's Future Prospects.....



Good luck with all that - It's never easy evaluating Mergers, mainly because we don't know how much trouble the Prey really are in.....And they are not going to let the Average Punter have access to that sort of info....


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## DrBourse (8 August 2021)

Opening Prices (Market Depth and Orders) are pretty useless, because The Fundies & other Big Players don't 'hit the boards' till approximately 9.55am each day…..

Then they start manipulating the Indicative Price while they ‘jockey’ for what they consider the prime position within the Depth Stack that will entice others to place their orders…..

Then they change their Bids in the last few seconds just to confuse those punters that are unaware of how they operate…..

Sheep & Newbies are their primary targets…..

Personally I only ever trade ‘live’, that is, I only trade when shares actually trading according to their individual “Start Times and 4pm Closing Time” – I always use “At Market, and Good for the Day” as I am prepared to take a chance on any ‘Slippage’, I am not prepared to play Stupid Games with the so called “Experts”…..

Cash market trading hours (asx.com.au)


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## DrBourse (8 August 2021)

Everybody needs to get up to date with “OLD SAYINGS” – They are just that – “USELESS OLD SAYINGS”……The fear everyone has about May & October each year is RIDICULOUS - most are Great Months – Particularly since the year 2000…..

OCTOBERS for 2000, 2001, 2002, 2003, 2004, 2006, 2007, 2010, 2011, 2012, 2013, 2014, 2015, 2017, 2019 & 2020 were all UP.....

OCTOBERS for 2005, 2008, 2009, 2016 & 2018 were down.....

MAY, 2001, 2002, 2003, 2004, 2005, 2007, 2008, 2009, 2014, 2016, 2018, 2019, 2020 & 2021 were all UP.....

MAY 2006, 2010, 2011, 2012, 2013, 2015 & 2017 were down.....

Now I need to clarify something about the May/October Theory, it all depends on which school you went to....

Some say that the calculation is "that a particular month is either Up or Down in relation to the previous month" (not really sure what part of the previous months data they would use - High, Low, 1st day, Last day, etc)...

Most Analysts/Brokers say the calculation is "that a particular month is either Up or Down from Close Of Trading on the 1st day of the month to Close Of Trading on the last day of the month...

Others suggest the calculation should be from "the opening price on day one to the closing price on the last day of the month...

The May/Oct Theory dates back to the early to mid 1900's when Company Reporting Rules revolved around the now obsolete March & September Reporting Timetables.....

They are old "Share Trading Rules" that belong to a past era, and as such have outlived their usefulness - Smart Brokers are using scare tactics and misguided fear to make profits at your expense.. WAKE UP AUZZIE..... Savvy Brokers are setting you up AGAIN......

When you think about it, it really is a form of Ramping......

All I can suggest is that you must DYOR if you are relying on this OUTDATED THEORY....


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## DrBourse (8 August 2021)

Beginners’ should prove to themselves that they can trade successfully by Longs only - after that it might pay to look at Derivatives - far too many ppl dive straight into Derivatives only to lose the lot because they "Tried to Run B4 they could Walk" - unless you have a 'Direct Phone Line' to the Fundies, Merchant Banks, Broking Houses and other Market Manipulators, the odds are really stacked against you - Buffett, and numerous other Commentators refer to Derivatives as WMD's (Weapons of Mass Destruction)


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## DrBourse (8 August 2021)

Iceberg Order - A large single order that has been divided into smaller lots, usually by the use of an automated program, for the purpose of hiding the actual order quantity. Note, When large participants, such as institutional investors, need to buy and sell large amounts of securities for their portfolios, they can divide their large orders into smaller parts so that the public sees only a small portion of the order at a time--just as the 'tip of the iceberg' is the only visible portion of a huge mass of ice. By hiding its large size, the iceberg order reduces the price movements caused by substantial changes in a stock's supply and demand...


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## DrBourse (8 August 2021)

Fund Buying & Selling (Cross Trade) can effect a stock by just swapping a holding between several of their own subsidiaries over a period of time - they Buy, Sell, Borrow, Return and Receive shares, over a one month period – they may have some of their subsidiaries showing a loss so to make all of the subsidiaries show a Profit, in a “Smoke n Mirrors” game they basically they need to shuffle stocks between their subsidiaries..... These Trades/Swaps are normally done Outside Normal Trading Hours.....

Let’s assume that Fund Nr 1 is running at a profit and within that fund they bought XYZ for $4.48 on 24/10, let’s say XYZ is now abt $4.72, so there is a profit of 0.24c per share, what they do is to transfer some or all of those shares into a Fund Nr 2 of theirs that is currently showing a Loss, that Fund Nr 2 buys the PRY shares for say $4.64, that gives Fund Nr 1 a 0.10c profit per share, and now Fund Nr 2 who just magically got these PRY shares @ $4.64 each are now also showing a profit as the current share price is still abt $4.72....

Fund Nr 1 was in profit, it still is, but it is just a smaller profit, Fund Nr 2 was in a Loss situation, but now after this magical transfer from Fund Nr 1, we see that Fund Nr 2 is also in PROFIT – all this happens on a daily basis so their individual Fund Subsidiaries NEVER show a LOSS...

But while they are playing Monopoly they are intentionally or unintentionally driving the XYZ share price up or down....

While all this is going on, and in this instance there were a dozen or more Funds involved .. the average Sheep of this world are following the Fund Buying & Selling, that’s OK until the Fund stops, then the Share Price drops pretty quickly leaving a lot of Sheep holding a LOSS.....

There are several variations to that Fundie scenario, sometimes the shares are onsold from Losing Fund into a Profitable Fund at say $5.00 per share, that way the Profitable Fund is just a little bit Less Profitable because they overpaid for the shares, but the Losing Fund magically sold their shares at a ridiculous price, which is great for them because that losing fund is now also in profit......

Hope you can follow all that.....it’s all pretty useless info, but it filled in a bit of time for me


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## DrBourse (8 August 2021)

Force Majeure (French for "greater force") is a common clause in contracts which essentially frees both parties from liability or obligation when an extraordinary event or circumstance beyond the control of the parties, such as war, strike, riot, crime, act of nature (e.g., flooding, earthquake, volcano), prevents one or both parties from fulfilling their obligations under the contract. However, force majeure is not intended to excuse negligence or other malfeasance of a party, as where non-performance is caused by the usual and natural consequences of external forces (e.g., predicted rain stops an outdoor event), or where the intervening circumstances are specifically contemplated.


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## DrBourse (8 August 2021)

Most people are misinterpreting the “Economic Clock”… It is an “Economic Clock”, It is NOT a “Share Market Clock”… It is an “Economic Indicator”, It is NOT a “Share Market Indicator”… The commonly accepted, 10 year Economic Clock, shows historically what should happen next within the “General Economy of the Country” – but there is no exact time frame attached to the Economic Clock… The Economic Clock gives us an Indication, that we have to interpret, of Economic Conditions within an uncertain timeframe… The Economic Clock and it’s Trends do NOT mean that the Share Market will automatically follow suit… We have to interpret those predicted Economic Conditions, then we have to work out how Individual Stocks are going to react to those Economic Conditions… AN ECONOMIC CLOCK SLOWDOWN DOES NOT AUTOMATICALLY MEAN THAT ALL STOCKMARKET SHARES & INDICIES WILL SLOWDOWN… Some Stocks will slowdown – Some Stocks will gain – Some Indicies will slowdown – Some Indicies will gain…-… The trick here is for us, as Traders, to locate the Stocks we wish to successfully trade.


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## DrBourse (8 August 2021)

CD=the term B4 dividend is paid where share price usually rises -- XD= EX Dividend, when the price usually drops back by abt the amt of the Dividend – HOWEVER - Stocks DO NOT ALWAYS pullback on their Ex Date - the EX effects different stocks in different ways within different Economic conditions – SO, Don't assume that every stock will always pullback on it's EX Date, and Don’t always presume that every stock will rise immediately after it’s Ex Date pullback……Check the Stock in question and do some research, see what happened on each of the last 5 years Ex Dates and immediately after.... Chances are that history will repeat itself....


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## DrBourse (8 August 2021)

If a company is Delisted you still own shares in the company. It’s up to you to contact the company to find out what procedures it has put in place for the transfer of shares in that company…..

Delisting is simple. But, if the company not being simply delisted, for example if it is being put into administration or going bankrupt, then you will have to deal with the solicitors in charge of that administration process.

Try these web sites ;-

http://www.delisted.com.au

https://www.asx.com.au


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## DrBourse (8 August 2021)

I don't agree with people publicly rubbishing one system or the other just because they don't understand the way TA or FA works, then they try to force their own personal preferences onto others, by goading them into comparisons of one sort of analysis over another.... it's an annoying approach that they put forward, and a bit immature..... Once Traders learn how to use TA & FA properly, it is quite easy to take advantage of the "Minor Irritants" that Algo & Option Traders cause, because Algo & Option Traders use TA in a slightly different way than normal, so it easy to exploit their mistakes.....

I am a Technimental Trader (I employ 60% FinA and 40% TA), TA is used worldwide, particularly by Merchant Bankers, Analysts, Brokers, Algo Systems, and millions of others, some cannot understand that fact, and that is just an annoying and uneducated fact of life ..... so, I tend to switch off and ignore them.....

There are numerous “MINOR IRRITANTS” such as Option Traders, Algorithmic Trading, ABC Swing Traders, FTMC Traders, Direct Market Access (DMA), VWAP Strategy, etc that you will encounter on your journey into the Share Trading Sandpit…….

These “MINOR IRRITANTS” can be a huge obstacle to your success, unless you take the time to fully understand how each “MINOR IRRITANT” works and how those devotees all use Technical & Financial Analysis to achieve their goals….. You need to Fully Understand how they work their Magic Tricks……

You must become Expert in Technical & Financial Analysis yourself, so you can take advantage of their shortcomings……

You can take advantage of their actions by using slightly different Indicator parameters (O’Bought, O’Sold Limits & Terms), AND by accepting slightly different Ratio & Margin of Safety expectations (some higher than normal and some lower than normal)…..

Volume is probably the main Technical Analysis Tool that these “Minor Irritant beings” use…..

Unfortunately, most of them don’t even realise that Volume, Volumetric Weight and other forms of Volume Calculation are all TA Indicators……

They also use Weight of Numbers (another TA Tool) to base their actions on, whereas Technical Analysts use other Volume Tools like VWAP Indicators, or the basic Volume Formula in its raw state, or Candlesticks, or any one of several other Volume Based Indicators……

I guess my main point is two fold – One is that New Traders must be Fully Educated, and 2ndly, - Don’t be bullied or intimidated by any of the “Minor Irritant” trading systems…


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## DrBourse (8 August 2021)

There are always Rumours and Irresponsible Reports appearing on every topic imaginable.. Our task is to listen to those reports then let the Market itself tell us how those reported events are being interpreted….

World & local events will be reflected in our Daily Market, but we can see how those Rumours and Irresponsible Reports effect our market day by day, - I use the XJO (S&P/ASX 200) to see that effect.


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## DrBourse (8 August 2021)

When Brokers begin to push the "Santa Clause Rally" late each year - Brokers will randomly pick stocks they think they can bluff sheep into buying, stocks that 9 times out of 10 the Brokers wan to sell - they create a mythical ST rally that they can Sell into at the Sheep’s expense.


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## DrBourse (8 August 2021)

One of the problems traders continually have trouble with is, "To Sell, or not to Sell ???" - Traders should ask themselves one Question - "If I did not own this stock right now, would I buy it", - If the answer is that you would buy, then you should probably hold - HOWEVER, if the answer is that you would not buy now, then you should probably Sell ASAP...... BUT DYOR.


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## DrBourse (8 August 2021)

A Dead Cat Bounce is a term used by traders in the finance industry to describe a pattern wherein a spectacular decline in the price of a stock is immediately followed by a moderate and temporary rise before resuming its downward movement, with the connotation that the rise was not an indication of improving circumstances in the fundamentals of the stock. It is derived from the notion that "even a dead cat will bounce if it falls from a great height". The phrase has been used on the trading floors for many years. However the earliest recorded use of the phrase dates from 1985 when the Singaporean and Malaysian stock markets bounced back after a hard fall during the recession of that year. The Financial Times reported a stock broker as saying the market rise was a "dead cat bounce". The reasons for such a bounce can be technical, as investors may have standing orders to buy shorted stocks if they fall below a certain level or to cover certain option positions. Once those limits are reached, the buy orders are activated and the sudden rise in demand causes the price of the stock to rise as well. The bounce may also be the result of speculation. Since bounces often occur, traders buy into what they hope is the bottom of the market, expecting a bounce and thus making a quick profit. Thus, the very act of anticipating a bounce can create and magnify it. A market rise after a sharp fall can only really be seen to be a "dead cat bounce" with the benefit of hindsight. If the stock starts to fall again in the following days and weeks, then it is a true dead cat bounce. If the market starts to climb again, it was not a bounce but a real bottom. The phrase has also been used in politics in reference to primary election poll figures for United States presidential elections......






						Dead cat bounce - Wikipedia
					






					en.wikipedia.org


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## DrBourse (8 August 2021)

I wish more Stock Market Players had the view that they “DO NOT BELIEVE IN WHAT CHARTS SAY”…....

As a Technimental Trader (I rely on 60% Fundamental’s AND 40% Technical’s), I just love the Stock Market Players with the “I DONT BELIEVE CHARTS” philosophy.



They all make my job so much easier – my Bank Balance Applauds them all, as we Technimental, or Technical Traders, benefit from their uneducated outlook on this profession.



Then there is the argument of Financial Analysis vs Technical Analysis - Remember Balance Sheet Financials & Financial Analysis are issued, “As At a certain Date”, so as time progresses it becomes less relevant - but Technical’s & Technical Analysis (which = share price movements) actually reflects CURRENT NEWS, CURRENT ANNOUNCEMENTS, CURRENT VALUES & CURRENT MARKET SENTIMENT - your stock selection should be based on both FA & TA, not one or the other.



TA was created a thousand years ago to help Fundamental Players understand exactly what was happening in the real world of Share Markets - I think it began in Japan & China, then during the Tulip Boom they added some more EASY TO UNDERSTAND INDICATORs & CANDLESTICK info for the Fundamentalists to follow.



We should view the market as an entire entity, a living, throbbing reality that includes fundamentals, technicals, and realities such as news, rumors, seasonal tendencies, common sense observations, and market conditions.... take a smattering of what others may call “fundamentals” along with a pinch of what some call “technical analysis,” and combine them with a spoonful of know-how to succeed in making your living in the markets.



To all the unbelievers out there - PLEASE keep the flag waving


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## DrBourse (8 August 2021)

Introduced to the financial markets in 1927, an American Depositary Receipt (ADR) is a stock that trades in the United States but represents a specified number of shares in a foreign corporation. ADRs are bought and sold on American markets just like regular stocks, and are issued/sponsored in the U.S. by a bank or broker... ADR's were introduced as a result of the complexities involved in buying shares in foreign countries and the difficulties associated with trading at different prices and currency values. For this reason, U.S. banks simply purchase a bulk lot of shares from the company, bundle the shares into groups, and reissues them on either the New York Stock Exchange (NYSE), American Stock Exchange (AMEX) or the Nasdaq. In return, the foreign company must provide detailed financial information to the sponsor bank. The depositary bank sets the ratio of U.S. ADRs per home-country share. This ratio can be anything less than or greater than 1. This is done because the banks wish to price an ADR high enough to show substantial value, yet low enough to make it affordable for individual investors. Most investors try to avoid investing in penny stocks, and many would shy away from a company trading for 50 Russian roubles per share, which equates to US$1.50 per share. As a result, the majority of ADRs range between $10 and $100 per share. If, in the home country, the shares were worth considerably less, then each ADR would represent several real shares......



There are three different types of ADR issues:

• Level 1 - This is the most basic type of ADR where foreign companies either don't qualify or don't wish to have their ADR listed on an exchange. Level 1 ADRs are found on the over-the-counter market and are an easy and inexpensive way to gauge interest for its securities in North America. Level 1 ADRs also have the loosest requirements from the Securities and Exchange Commission (SEC).

• Level 2 - This type of ADR is listed on an exchange or quoted on Nasdaq. Level 2 ADRs have slightly more requirements from the SEC, but they also get higher visibility trading volume.

• Level 3 - The most prestigious of the three, this is when an issuer floats a public offering of ADRs on a U.S. exchange. Level 3 ADRs are able to raise capital and gain substantial visibility in the U.S. financial markets.



The advantages of ADRs are twofold. For individuals, ADRs are an easy and cost-effective way to buy shares in a foreign company. They save money by reducing administration costs and avoiding foreign taxes on each transaction. Foreign entities like ADRs because they get more U.S. exposure, allowing them to tap into the wealthy North American equities markets.



Each ADR's Ups or Downs, plus other factors, all added together gives me a direction for each individual stock and the industry each stock…

Personally, I refer to my ADR List every morning so I can see what happened to our Australian ADR's, getting that information helps my research into just what MIGHT happen with stocks on our ASX.....

I mainly look at the ADR Chart & Candles for Technical Signals at their COB, then relate that candle to what we may expect today - then I look at say the last week or two and compare that trend to our equivalent stock......

Then if needed I will conduct further analysis....

Let's use a mythical stock of XYZ as an example, their ADR (XYZ) atm is Down $0.27USD, or 1.39%, so in theory our XYZ, should reflect that % Drop, BUT then you need to add in our Domestic Economic Climate, and our relative Australian problems and Announcements that may occur between the DJIA Closing time, and the End of Our Trading Day, then obtain news of any of those factors that occurred in the "USA" during their Trading Day..... Not easy accessing all that info, but can be done with the help of some American contacts, in other words I try to get the American version/explanation of What Caused the 1.39% drop....

It's not an EXACT Science, but it usually works for me....

There are DOZENS of other Aussie Stocks listed on numerous other Exchanges, like NYSE, OTC, NASDAQ, Germany, NZ, Sth Africa, Canada, etc, etc....

You can find them all by going to the FREE Web Site - https://www.marketwatch.com

When you get to that site Select "Markets", Then hit the Search Symbol to the right, that gives you a Black Window, where it says "enter a symbol or keyword" you need to try 2 ways, first enter XYZ, then WAIT, DO NOT HIT ENTER, as the search will appear automatically, if that does not produce results, enter "THE FULL COMPANY NAME", that may give the results you are looking for....

Hope you can follow all that....



I would like to point out a minor anomaly - ADR's are usually quoted “in Aussie $$s - the rises and falls are usually against last evening's local USA or UK close" - I prefer to use Bloombergs "Actual Days Trade Figures", they relate to the Days Trade only - so in the USA O'nite if XYZ traded down $1.80 (or 3.07%) during the day, HOWEVER it may have been down 0.57c compared to their yesterdays Close – make sure you understand the diff.


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## DrBourse (8 August 2021)

For Newbies and anyone else trying to relate the Overnight DJIA to our "Market or Individual Stocks", here is a method to calculate the ASX200’s rise or fall for the day, _it's never perfect_, but it is usually pretty close, it's what most of the so called "Experts" use each morning here in OZ........

Use last night’s Dow Jones figure, Divide by 3, then Divide by 2.- SO - IF DOW JONES was UP by 190, then our ASX200 should be UP by about 32, that is, 190 divided by 3 = 63.33, then 63.33 divided by 2 = 31.66......... there are other options to this formula, but I will let the mathematicians of this world show them to us.

SO.......

If BHP was up by $2.41 on the DOW, we would divide $2.41 by 3, then divide again by 2 = 0.4016666c, so our ASX BHP should be up by about 0.40cents.........

There are various ways of calculating/guessing how our Market or Individual Stocks will react to the DOW's results each day, Remember, as there are several other factors involved, it's never perfect, but it is usually pretty close........

Other Factors you need to add in like our Domestic Economic Climate, and our relative Australian problems and Announcements that may occur between the DJIA Closing time, and the End of Our Trading Day, then obtain news of any of those factors that occurred in the "US of A" during their Trading Day..... Not easy accessing all that info, but can be done with the help of some American contacts, in other words I try to get the American version/explanation of What Caused the Rise or Fall....

It's not an EXACT Science, but it usually works for me....


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## cynic (8 August 2021)

Dr Bourse, I presume that you are aware that the DJIA is a price weighted index of 30 companies?!

Wouldn't reference to a capital weighted index of 500 companies, (in which some of the ASX200's major constituents also happen to feature), such as the S&P 500, serve as a better reference?


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## divs4ever (8 August 2021)

DrBourse said:


> But while they are playing Monopoly they are intentionally or unintentionally driving the XYZ share price up or down....



now a tweak to that i spotted years back  ,  is that 'big player '  rents shares  out to  blur the activity they desire 

 say they are buying ( carefully ) but lending to short-sellers  , and adding in the dips created by the short-sellers     ( those skilled option traders would also be aware of other games you can play with borrowed/leveraged shares  )

 your big player doesn't APPEAR to be driving the share price down , but is certainly accommodating others to do precisely that

 obviously a similar tactic can be used as a prelude to a hostile takeover ( or change of control )


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## divs4ever (8 August 2021)

Dow Jones Companies Sorted by Weight
		


Data Details​When companies are removed and added to the index the membership list may temporarily show both the removed company and added company.

Data as of 08/05/2021.

 goes to show , i had previously believed  they were selected companies weighted by market cap. 

 cheers and thanks 

 imagine if the ASX did that .. to say replace the XJO   or XTL 

  DYOR


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## DrBourse (21 November 2021)

I have 21 Calculators that I have either developed for my own needs, or have developed at the request of other Traders.

They are all just gathering dust, and taking up valuable space here.

*The List below summarises Calculators Numbered 7 to 27.*

The first 6 are cloned versions of 7 to 27 that I created for my personal use.




Happy to send copies to anyone that thinks they can make use of them.

Each one has Comment Box Instructions that are easy to follow.

Anyone interested will need to Direct Message me with your email address.

I will send the lot on one return email, then you can just delete the ones you don’t want.

My next 2 posts will show a Shortened Version of each calculator.

Cheers.

 DrB


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## DrBourse (21 November 2021)

*7 CGVI Calculator - Multiple Stocks.xlsx 


*



*8 CGVI Calculator - One Stock.xlsx*

*

*



*9 ABC Calculator.xlsx


*



*9 ABC Calculator Explanation.xlsx


*



*10 Value & Momentum Calculator.xlsx*








*11 Completed Trades - Multiple Stocks.xlsx*




* 

12 Completed Trades - One Stock.xlsx


*



*13 Profit Loss Calculator v2.xls


*



*14 Dividends Received for Tax Yr.xlsx


*



*15 Trade Calculator Fee $11k to $25k $29.95 Fee.xlsx*




* 

16 Trade Calculator Fee +$25k @ 0.12% Fee.xlsx


*


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## DrBourse (21 November 2021)

*17 Value Investing Ratio.xlsx






18 Larval Calculator.xlsx






19 RMV Calculator.xlsx






20 Trade Summary - Multiple Dividends.xlsx






21 Trade Summary.xlsx






22 Finance.xlsx






23 Asset Based Inferred Value Calculator.xlsx






24 Ratio & MOS Explanations & Print Version.xlsx






25 Ratio Formulas of Buffett & Graham.xlsx






26 Ratio Matrix.xlsx






27 Stock on Hand.xlsx


*


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## Rabbithop (27 November 2021)

DrBourse said:


> In this Profession the idea is to Trade when there is a Trade to be made, and even then, you should 'Play the Trade' (like playing a Fish), you should NOT trade the $$$'s - get the trades right and the $$$'s will automatically follow, buying stocks just because you have to 'Make Money' is the wrong reason to buy ... Unfortunately, there are a lot of ppl in that situation - they are usually the ones that get burnt.
> 
> One of the problems traders continually have trouble with is, "To Sell, or not to Sell ???" - Traders should as themselves one Question - "If I did not own this stock right now, would I buy it", - If the answer is that you would buy, then you should probably hold - HOWEVER, if the answer is that you would not buy now, then you should probably Sell ASAP...... BUT DYOR.
> 
> This is not a game – this is a Profession - it is called share trading not shareholding.



1st paragraph,  count me in. Buy to make money.
2nd paragraph...gd tips..shall practise it. Going to write it up to remind moi.😁


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## Rabbithop (27 November 2021)

DrBourse said:


> For Newbies and anyone else trying to relate the Overnight DJIA to our "Market or Individual Stocks", here is a method to calculate the ASX200’s rise or fall for the day, _it's never perfect_, but it is usually pretty close, it's what most of the so called "Experts" use each morning here in OZ........
> 
> Use last night’s Dow Jones figure, Divide by 3, then Divide by 2.- SO - IF DOW JONES was UP by 190, then our ASX200 should be UP by about 32, that is, 190 divided by 3 = 63.33, then 63.33 divided by 2 = 31.66......... there are other options to this formula, but I will let the mathematicians of this world show them to us.
> 
> ...



Will try out the calculation on BHP.
Whats your opinion on BHP..how low can it go? My guess around $30.


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## DrBourse (24 January 2022)

As I’ve mentioned in previous posts, I will visit ASF every so often just to check for any *“questions from beginners”.*

There is no point in me posting anything new.

Cheers.

DrB.


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## DrBourse (30 September 2022)

Everybody needs to get up to date with “OLD SAYINGS” – They are just that – “USELESS OLD SAYINGS”……The fear everyone has about May & October each year is RIDICULOUS - most are Great Months – Particularly since the year 2000…..

OCTOBERS for 2000, 2001, 2002, 2003, 2004, 2006, 2007, 2010, 2011, 2012, 2013, 2014, 2015, 2017, 2019, 2020 & 2021were all UP.....

OCTOBERS for 2005, 2008, 2009, 2016 & 2018 were down.....

MAY, 2001, 2002, 2003, 2004, 2005, 2007, 2008, 2009, 2014, 2016, 2018, 2019, 2020 & 2021 were all UP.....

MAY 2006, 2010, 2011, 2012, 2013, 2015, 2017 & 2022 were down.....

Now I need to clarify something about the May/October Theory, it all depends on which school you went to....

Some say that the calculation is "that a particular month is either Up or Down in relation to the previous month" (not really sure what part of the previous months data they would use - High, Low, 1st day, Last day, etc)...

Most Analysts/Brokers say the calculation is "that a particular month is either Up or Down from Close Of Trading on the 1st day of the month to Close Of Trading on the last day of the month...

Others suggest the calculation should be from "the opening price on day one to the closing price on the last day of the month...

The May/Oct Theory dates back to the early to mid 1900's when Company Reporting Rules revolved around the now obsolete March & September Reporting Timetables.....

They are old "Share Trading Rules" that belong to a past era, and as such have outlived their usefulness - Smart Brokers are using scare tactics and misguided fear to make profits at your expense.. WAKE UP AUZZIE..... Savvy Brokers are all about setting you up AGAIN......

When you think about it, it really is a form of Ramping......

All I can suggest is that you must DYOR if you are relying on this OUTDATED THEORY....


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