# FundaTechnical Analysis - The way of the future



## rbbrain (29 December 2009)

Hi.

My recent research and public presentations led me to conclude that since the GFC, the best way forward is to use FundaTechnical Analysis - it is the analysis method of the future.

FundaTechnical Analysis states two key things about stock selection:

Fundamental Analysis - Should be used to identify quality companies in which you would be happy to invest; and
Technical Analysis (charting) - This is the tool to use to optimise the timing of both your purchase of the stock, and your eventual disposal.
This approach is based on the idea that quality companies should not go bust - like a few large companies did during the recent GFC.

And it is based on the idea that the buy-and-hold strategy is not useful for optimising your available capital. This is because bear markets and market corrections come around far too often, and can decimate your funds.

Now, what about the details? How should we use Fundamental and Technical Analysis to do all this? Well, that is not so straight forward.

The key idea here is to use a BLEND of the two analysis methods.

All of the old buy-and-hold investors need to bend a little and adopt some charting tools.  And the chartists / technical analysts could benefit from using some fundamental analysis to choose only quality companies.

Stay tuned for more details soon.


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## Mr J (29 December 2009)

Are you posting out of the goodness of your heart, or to offer a service further down the road?


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## wayneL (29 December 2009)

What's wrong with Technimental Analysis?


Technical Analysis  - To find tradeable signals.
Fundamental Analysis - To see if you want to own the piece of crap for any length of time.


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## Krusty the Klown (29 December 2009)

I reckon there would be a fair few people who do this already.

FA for qualifying the stock to lower risk.
TA for timing entry, hold time and exit.


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## nunthewiser (29 December 2009)

WHOA!

a new market approach .

Where do i sign?


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## nunthewiser (29 December 2009)

Actually happy to hear your stuff about an ancient and well proven strategy as long as your here for good and not trying to sell us a "suck eggs" trading program/course.


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## rbbrain (29 December 2009)

As someone who likes to help others, I have felt sorry for the many people who lost a lot of money in 2008-9 because of the GFC. And I have been asked to talk to groups about these ideas. So I thought I would post a snippet here to see what sort of response we might get, and what others think of this way of looking at it.

I know that many people will already be doing this. But there are also many people out there who are struggling to find a sensible way through the maze.

So, I am not here to sell a course, or program, or anything. Just to pull together some of the ideas that are out there to hopefully help those who are looking for help. (I do believe in karma - what goes around comes around - or is that the wrong word for it?).

But which comes first? - FA? or TA?

My logical thinking says that if I use charting software with a good watchlist facility, then I should firstly prepare a watchlist of quality stocks using FA. Then I can use the charting software scan / filter facility to find those stocks that currently fit my selection criteria. If I only watch 300 or 400 stocks, there is no point in running a scan over 2,000 stocks.

The next discussions will probably be about things like:
"What is the best FA criteria to use to select quality stocks for my watchlist?"
and
"What is the best way to find a stock in my watchlist for investing TODAY?"

Cheers


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## So_Cynical (29 December 2009)

I tend to agree with rbbrain as ive been sorta using a Funda/Technical approach for the last 16 months, so i probably don't need to be sold on the benefits of that approach...its nothing new to me.

I find the Funda/Technical approach very suitable to my personality and, buy and watch, value buying, medium term, high yield, investment goals.


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## sammy84 (29 December 2009)

I would suggest most technical trader would subconsciously in one way or another employ fundamental factors in their decisions making process. I classify myself as a technical trader, yet I know I have on more than one occassion been more willing to enter a trade if it is in sector I am fundamentally bullish on, or an individual stock which I think has good prospects.

My


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## Julia (29 December 2009)

Krusty the Klown said:


> I reckon there would be a fair few people who do this already.
> 
> FA for qualifying the stock to lower risk.
> TA for timing entry, hold time and exit.



Yes, exactly.  This is hardly an innovative approach, Brainy!



sammy84 said:


> I would suggest most technical trader would subconsciously in one way or another employ fundamental factors in their decisions making process. I classify myself as a technical trader, yet I know I have on more than one occassion been more willing to enter a trade if it is in sector I am fundamentally bullish on, or an individual stock which I think has good prospects.
> 
> My



That's interesting, sammy.  We seem to have many pure chartists here who say they have no idea even what the company does when they buy a stock.


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## Julia (29 December 2009)

rbbrain said:


> As someone who likes to help others, I have felt sorry for the many people who lost a lot of money in 2008-9 because of the GFC. And I have been asked to talk to groups about these ideas. So I thought I would post a snippet here to see what sort of response we might get, and what others think of this way of looking at it.



My earlier comment wasn't meant to be scornful, as you're right, there are lots of folk who have no idea why they lost as much as they did.

Perhaps you could tell us a bit about yourself, rbbrain, and in what capacity you have been 'asked to talk to groups' about these ideas?


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## rbbrain (30 December 2009)

Hi,

You have asked to know a little about myself. Happy to oblige so you can understand where I am coming from, and where I am going to. 

I am a technical analyst who used to rely 100% on the charts, and I did not care about the fundamentals. This did not get me into any trouble - perhaps more luck than anything.

I am also the Vice-President of the Vic chapter of the ATAA (Australian Technical Analysts Association), and a director on the national board.

I am also the convenor of the Australian BullCharts Users Group. We have monthly meetings in Oakleigh. A lot of the members there work full time and are learning more about TA so tht they can better manage their "investments" by trading over either a short term, or longer term (they are all different).

In these capacities, I was approached by the Manningham U3A (University of the Third Age), and one of the SIGs of the Melbourne PC User Group (the WASINT SIG), to talk to them about charting, and these things called bear markets. (And also the EIS group of traders - followers of Phil Anderson - who meet monthly at in Flinders Lane, Melb).

[btw - there were about 65 U3A people at the presentation, and we had an engaging and interesting discussion for 1+ hours about why they lost money, and how to avoid it next time.]

My presentation to each group was a sub-set of the powerpoint slides entitled "Beware the Bears - they are never far away", and subtitled "Lessons from the GFC for traders and investors".

My extensive research for this, and subsequent conclusions, are that we need to get the message to those unfortunate "investors" that they need to adopt some degree of charting and a readiness to sell at the start of a bear market in order to preserve their capital.

A number of traders also lost money in 2008 because they did not agree with the market's interpretation of the value of some companies. When some stocks well 50% +, some traders said "it's cheap, so buy more!!". This is not a good approach for traders who want to preserve their capital.
So the lesson for ALL traders is that it is worth doing at least a little homework about a company before buying shares in the company. In this way we can mostly avoid getting suckered into losers like ABS Learning, Allco Finance, MFS, and a few others. (Did any of you lose money in these last year?).

So, my goal and mission here is to simply get the message out to those who want to listen - to employ some sort of balance between FA and TA. The balance will be different for different people. If anyone wants to press on and invest in ANY stock on the market, regardless of their fundamentals, then go ahead, by all means. If the stock suddenly goes into a trading halt, and then plummets in value, well bad luck.

Cheers


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## condog (30 December 2009)

Hi Brainy

Wellcome to ASF....I hope your here for legitimate reasons....

This has been discussed man times and there are people firmly in all camps including yours.......

The cycnic in me wants to ask what your selling and how bigs your own personal portfolio and recnet returns plus stock holdings, but if some one asked me Id tell them to MTOB.

So politely I will say yes I agree use fundamental to identify which stocks to touch... use technical as a timing guide....

Never use technical without fundamental.....but to use fundamental without technical is Ok but you may lose in the short term....or ay too much....

It aint necesaryily the way of the future its the way its always been for most....  I just hope your not a SellerFundTechniSalesFruitCakeCrpaSytmRubbish posing as a new member....


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## Wysiwyg (30 December 2009)

Hello, how do you do? Apologies for the paranoiacs on line here.  

Is wondering what your fundamental criteria are?





.


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## rbbrain (1 January 2010)

Hi,

To answer a couple of the latest questions above:

How is my own portfolio performance? Let me say that in early 2008 I "switched" my superannuation asset allocation within the managed fund from shares to cash and bonds. So I did not lose money in 2008. Unlike most people who Buy-and-Hold, or who solely use FA.

I think that using FA 100% and no TA is financial suicide (ie. it is NOT ok to use 100% FA and no TA - sorry to disagree with some investors). If you take a good look at how the market moves up and down week after week, and month after month, you can see there are significant market moves. In the long term they do get ironed out (averaged out), so that if you have a good mix of stocks (diversification) then you might also do okay. But these bear market periods can do significant damage to a portfolio. And the FA will not help you to liquidate and to "protect profits". This is one thing that TA does help with. TA also helps to stop you buying at the top of the bull market during the period of irrational exuberance. Don't you hate it when you buy in, only to see the stock fall in value?

Now, my preferred Financial Criteria? There are 3 must-haves:

ROE should be at least 10% pa for at least a couple of years - the higher the better.
Debt to Equity should be below 70% or even 50% (the lower the better).
Interest Cover — Earnings should be at least 3 times interest.
These criteria will help to weed out the not-so-good companies. In some ways it is the good quality company management that helps steer companies along this sort of road.

Cheers


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## condog (2 January 2010)

rbbrain said:


> Now, my preferred Financial Criteria? There are 3 must-haves:
> 
> ROE should be at least 10% pa for at least a couple of years - the higher the better.
> Debt to Equity should be below 70% or even 50% (the lower the better).
> ...




So what 5-10 stocks would you suggest should make up a share platform for 2010 - 2015 and why?


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## DaveMac (2 January 2010)

Hey guys, 

The funda / technical approach SOUNDS good, but haven't we all seen stocks shoot to the moon, while still having terrible fundamentals?  Wouldn't there be too many missed opportunities as we wait for the fundamentals to catch up to the greater market opinion? Just my 

Although to back up your idea: Market Wizard William O'neil uses a similar approach in his CANSLIM method, fundas and techs, and has had great success over 30+ years.


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## Garpal Gumnut (2 January 2010)

I use funnymentals to screen out the garbage.

Something gets announced, everyone piles in and then about 3 months later it has retraced then I look at my charts.

It works for me.

gg


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## lukeaye (2 January 2010)

Well what you have stated is hardly anything new.

I rarely use fundamental analysis. I might keep my ears open to possible announcments, but when looking to trade a stock that i pick up technically, i don't do a full backround check on whats going on with the stock, PE, or anything else.

Everyone else is looking at fundamentals and that is then interprated on my chart as volume and price. 

I personally don't have time to check fundamentalls out on everything.

Some of my best returns have been from the greatest risks, ie companies that would not fit your fundamental filter. So i don't think your style would suit alot of traders.

If you are here to help could you please take us through some of your strategies so we may look at what you are talking about


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## Garpal Gumnut (2 January 2010)

lukeaye, if you were referring to my post, that is all there is to it.

Some folk think the more complicated a system is the better it performs. 

Thats all there is mate, after the three months its price and volume.

gg


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## motorway (2 January 2010)

DaveMac said:


> Hey guys,
> 
> The funda / technical approach SOUNDS good, but haven't we all seen stocks shoot to the moon, while still having terrible fundamentals?  Wouldn't there be too many missed opportunities as we wait for the fundamentals to catch up to the greater market opinion? Just my
> 
> Although to back up your idea: Market Wizard William O'neil uses a similar approach in his CANSLIM method, fundas and techs, and has had great success over 30+ years.




Very True .

I remember seeing  Stock Screens that had  criteria like;

No Institutional or Fund Ownership
No Stock Broking or Analyst Coverage
No News or Visibilty

But Did have - Significant Director Holdings etc

Also others which only looked at Companies with "too much Debt"
Were at significant LOWS ( by some definition )
Etc

In both cases PRICE ACTION was an important entry criteria and time was with at least one an important exit Criteria

Screens that focused on very small caps
or less liquid ones                                            
Which were NOT in an INDEX etc



> "Elephants don't gallop - but fleas can jump to over two hundred times their own height" -- Jim Slater



]

Probably selecting the right Universe to explore in
( For what you looking for ) Is a KEY -->Then Price Action ( large Topic -->Instrument only ... Or plus Sector , Mkt &  Breath criteria )

Nothing _can_ Fail like success
Or _can_ succeed like Failure

Motorway


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## lukeaye (2 January 2010)

Garpal Gumnut said:


> lukeaye, if you were referring to my post, that is all there is to it.
> 
> Some folk think the more complicated a system is the better it performs.
> 
> ...




No i wasn't was refering to the OP post


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## lukeaye (2 January 2010)

That quote is brilliant from jim slater.

Exactly what im trying to say. It is often the riskier fundamental stocks that give the greatest returns.

And i take a lot of them.


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## rbbrain (3 January 2010)

condog said:


> So what 5-10 stocks would you suggest should make up a share platform for 2010 - 2015 and why?




Hi condog,

My picks for 2010-2015?

I am sorry to disappoint; but my investment horizon is limited to several months, plus/minus several months.

My analysis of Aussie bull and bear markets over 2 decades shows that we can only hope to find a good stock for the next 1 to 2 years at most (usually - sometimes longer; but usually just 1 to 2 years). This is because of the cyclic nature of our market cycles.

So, if I was to pick a stock for now, I know that I might need to exit it at any time over the next weeks or months, and "probably" dump it within a year or so.

The other thing that makes this tricky is that my exact "preferred" stock selection criteria might not suit other people who have their own "preferred" selection criteria. The broad concept of the FundaTechnical Analysis approach means that we do the FA using our own preferred criteria (mine are stated above) to produce a watchlist, and then use our own preferred TA criteria for timing the entry and exit.  I prefer to use Weekly and Daily charts, so the stocks I choose today might be different to the ones that I might choose next week.

Cheers.


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## rbbrain (3 January 2010)

DaveMac said:


> Hey guys,
> 
> The funda / technical approach SOUNDS good, but haven't we all seen stocks shoot to the moon, while still having terrible fundamentals?  Wouldn't there be too many missed opportunities as we wait for the fundamentals to catch up to the greater market opinion? Just my




Hi DaveMac and others who are advocating high-risk trades that don't use funnymentals.

There is one important aspect of trading that is often overlooked.

That is, while it is very important to have a documented Trading Plan and Strategy (for a number of reasons we can't go into here), it is also very realistic to have MULTIPLE TRADING STRATEGIES.

That is, it is a good mitigation of risk to have one strategy that follows some relatively conservative approach (like FundaTechnicals), and to also have a high risk speculative approach that like some of the methods that are mentioned throughout this thread. And a good analyst will have rules like "_I will only risk up to 30% of my trading capital on the speculative trades_".

Multiple Trading Strategies are a wise approach.

Mitigating risk in this way is sensible.

More food for thought?

Cheers


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## condog (3 January 2010)

So what are the 5 best current stock on your current watchlist from a fundamental viewpoint....irrespective of technical pricepoints...


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## DaveMac (3 January 2010)

rbbrain said:


> Hi DaveMac and others who are advocating high-risk trades that don't use funnymentals.




Hey Brainy,

A strategy is sound as long as it has a positive expectancy.  And expectancy is not made by using fundamentals or technicals, or a combo of the two.  It is made by how much you risk per trade, and how agressively you manage the trade (i.e. stop to break even).

Based on this, the funda / tech approach could be high-risk, depending on the investor and how the above is managed.

That's the only thing I disagree on, everything else you've said is spot on IMO .


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## condog (3 January 2010)

This thread is rubbish , its going no where talking about complete garbage...by all....I smell rats...


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## wayneL (3 January 2010)

condog said:


> This thread is rubbish , its going no where talking about complete garbage...by all....I smell rats...




Just don't read it then. 

But be assured that rats receive a cranium full of buckshot if discovered.

Meanwhile, lets cut brainy a bit of slack... innocent until proven guilty etc.


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## Sir Osisofliver (4 January 2010)

rbbrain said:


> My analysis of Aussie bull and bear markets over 2 decades shows that we can only hope to find a good stock for the next 1 to 2 years at most (usually - sometimes longer; but usually just 1 to 2 years). This is because of the cyclic nature of our market cycles.




Hi Brainy,

So is your analysis _only_ over the last two decades? You've mentioned the cyclical nature of our market, but your comment that you can only find good stock _to trade_ in the early part of the share cycle after a corrective pattern seems... simplistic. 

Commodities for example (generally) don't have their largest movement until the latter part of the cycle (due to consumer confidence, low stockpiles etc).

My preference is to consider the early part of the cycle as being the best point in time to create a longer-term buy and hold portfolio (based on solid fundamental factors and TA for entry). 

The mid and late cycle market movements on the other hand tend to be more volatile and are more suited to a trading strategy IMO.

Cheers

Sir O


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## Boggo (4 January 2010)

Sir Osisofliver said:


> My preference is to consider the early part of the cycle as being the best point in time to create a longer-term buy and hold portfolio (based on solid fundamental factors and TA for entry).
> 
> Cheers
> 
> Sir O




There is no doubt that this is a valid method, go back to 2002,3 for the likes of WOR, JBH and most of our mining stocks.

Not trying to ramp NQM and I do hold in my SMSF and it is perhaps an example of what Sir O is referring to.
NQM, current example, a 30c stock that pays a dividend, has had a large increase in revenue and earnings per share in the last year.
NWH, past example, was $3.50 in 2007 partly on hype and speculation, was 20c a year ago, got the fundamentals sorted out, is now $2.

Going back a few years ago, Onetel, fundamentally a basket case but everyone was buying the spin and creating the technical parameters.
The tech analysis did give a heads up eventually but the dodgy fundamentals were there all along.

I use tech analysis to find and manage candidates but if I have half a dozen choices that are technically identical then it comes down to fundamentals to narrow the field.

Just my


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## lukeaye (4 January 2010)

rbbrain said:


> And a good analyst will have rules like "_I will only risk up to 30% of my trading capital on the speculative trades_".
> 
> Multiple Trading Strategies are a wise approach.
> 
> ...




Excuse me, you want to risk 30% on a high risk trade? I wouldnt risk that on low risk trade. 

No offence brainy, but i fail to see what you are contributing here. What is it that you are helping with?

So far you have told us to use fundamental and technical analysis? Im still waiting for the rest?


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## wayneL (4 January 2010)

lukeaye said:


> Excuse me, you want to risk 30% on a high risk trade? I wouldnt risk that on low risk trade.
> 
> No offence brainy, but i fail to see what you are contributing here. What is it that you are helping with?
> 
> So far you have told us to use fundamental and technical analysis? Im still waiting for the rest?




I think you missed the point.

30% refers to the amount of total capital allocated to higher risk trades. Any individual trade must still adhere to individual trade risk parameters... 2% or whatever the trader has decided.


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## lukeaye (4 January 2010)

wayneL said:


> I think you missed the point.
> 
> 30% refers to the amount of total capital allocated to higher risk trades. Any individual trade must still adhere to individual trade risk parameters... 2% or whatever the trader has decided.




ahhhh, i see. Thank you for clearing that up.


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## DaveMac (4 January 2010)

condog said:


> This thread is rubbish , its going no where talking about complete garbage...by all....I smell rats...




Hmmm I see how it looks.  I know newbs have to prove themselves here (I've read the hundreds of other posts where they get hammered )  

Will post elsewhere for now.  

P.S. Go the techs!


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## Wysiwyg (5 January 2010)

rbbrain said:


> Hi,
> 
> To answer a couple of the latest questions above:
> 
> ...



_Thanks for your reply_. That sure does narrow the stock choices down.

For longer term, nowadays I like to rove an eye over a companies financial situation, where they have been, their goals that have & have not materialised, where they are going and  management language.

About an hour of reading is all I devote to any particular company research. Mostly Technimental.


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## Wysiwyg (6 January 2010)

> Now, my preferred Financial Criteria? There are 3 must-haves:
> 
> * ROE should be at least 10% pa for at least a couple of years - the higher the better.
> * Debt to Equity should be below 70% or even 50% (the lower the better).
> * Interest Cover — Earnings should be at least 3 times interest.




Hello again. I have been perusing fundamental screening programs such as Value Gain (+4KAUD), Conscious Investor (subscription) , Share Pricer (+$29USD) and Australian Stock Screener (free).

Do you use a software program to sift out stocks that meet your criteria?


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## alphaman (6 January 2010)

Fundamental analysis involves more than just a few simple ratios based on reported accounting numbers. 

An analyst who makes a living from fundamental research typically covers just 1 or 2 sectors and goes though an excruciating amount of time just to understand and undo the distortions built into accounting numbers. And despite all that focus and effort, analyst recommendations remain unreliable.

Not saying rbbrain's system does not work. I think for certain longer term systems, naive financial ratios may add value as a filter or profit target. But the combination of price and "fundamentals" is not as robust as one might think.


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## rbbrain (12 January 2010)

wayneL said:


> I think you missed the point.
> 
> 30% refers to the amount of total capital allocated to higher risk trades. Any individual trade must still adhere to individual trade risk parameters... 2% or whatever the trader has decided.




Hi WayneL,
Yes - spot on.

And some of the very successful TA traders I know will only risk a total of 5% of their trading capital on the spec trades.

An important point here is that this percentage amount is up to each individual to decide for themselves, and then record in their Trading Strategy.

I also know of some people who are very gung-ho and happy to risk a lot more than 30% of their capital on trades that they would not consider speculative; but they select the stock based on gut feeling, or their broker's advice, or some other criteria - with no FA or TA at all. Now that is gambling.

Cheers


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## SmellyTerror (13 January 2010)

Re FundaTechnicals: My golden cross is when Nick Radge and Charlie Aitken agree. 



rbbrain said:


> And some of the very successful TA traders I know will only risk a total of 5% of their trading capital on the spec trades.




"Only" 5% on a spec? The damp slap you just heard was the sound of my sphincter clenching in terror. I feel all courageous and daring when I go to 3%. I strut around the city looking at the crowds, and wondering, "do they know I go to three? Can they tell from my devil-may-care stride? MAKE WAY, PEASANTS! A HERO WALKS AMONG YOU". 

But 5% on a spec... No wait - *ONLY* 5%. I'm going to have nightmares, now. I'm going to be leaping out of bed screaming "my capital, my precious capital!" and my wife is going to keep me away from my charts for a couple of weeks. :

But hey, if it works for you guys, more luck to ya.


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## Idiode (29 January 2010)

Wysiwyg said:


> Hello again. I have been perusing fundamental screening programs such as Value Gain (+4KAUD), Conscious Investor (subscription) , Share Pricer (+$29USD) and Australian Stock Screener (free).
> 
> Do you use a software program to sift out stocks that meet your criteria?




As a newcomer to this forum I have to say thank you for this info Wysiwig.
Regardless of several others views, I have gained heaps of valuable information from this thread.  
Now using the Australian Stock Market Scanner as another tool thanks to your input.


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## rbbrain (23 February 2010)

Hi again,

Which Fundamental criteria does everyone prefer? Let's try to keep it simple. We know some of the F/Analysts love the number crunching, and pouring over the statistics, etc.  But traders who have little interest in F/A need a quick and easy way to do this.

My preferred three criteria are below. I only want three to keep it simple. No need to over-complicate this.

How do they compare with your own?

And how much do we have to pay to get this information? Either from a broker, or software, or a data service, or whatever?

#1 - ROE > 10% year on year for at least 3 years. - This is a "Performance" measure.
This is a good gauge of the success of a company at making profits.

#2 - D:E < 50% - that is - Debt/Equity ratio (This is a "Risk" metric).  For companies to grow, it helps if they can borrow money. The more money they borrow, then potentially the faster they can grow. One of the problems with a fast growing company is to keep up with the expanding needs for cash. Many growing businesses that go bust do so because they can't service the cash flow. But, if a company has taken on too much debt, they might one day get to the point where they have trouble servicing the debt. It seems that a ratio of debt to equity of about 50% is about the tipping point - any more and they run the risk of blowing up down the track (like ABC Learning Centres).

#3 - PE/Growth < 1 - (This is a "Value" metric"). Just looking at PE is simplistic. A company with a high PE might be considered over-price; but if they have future earnings growth potential, then the high PE can be justified. The way to even this out is to divide PE by the one year estimate for earnings growth. This brings the PE back to a more useful number.

How to get these values? What software etc?

Well, I use CommSec, and these values can be used in search criteria to identify the list of stocks - too easy.

Other brokers should have similar tools available to search for stocks.

Software like Lincoln Indicator's Stock Doctor might also be able to scan for these criteria.

how do these compare with everyone else's preferences?

Cheers


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## Mr J (23 February 2010)

SmellyTerror said:


> "Only" 5% on a spec? The damp slap you just heard was the sound of my sphincter clenching in terror.




My reaction was surprise, but not terror . Are we talking real risk here, i.e. prepared to lose 5% of trading capital, and the same for:



			
				rbbrain said:
			
		

> I also know of some people who are very gung-ho and happy to risk a lot more than 30% of their capital on trades that they would not consider speculative




30% is balls to the wall, even if the Kelly Criterion can justify it.

I prefer Technamental, but google shows that to already be in use.


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## Jack.c (23 February 2010)

As a shorter term trader, I am really not too sure how to use fundamentals to help my trading, apart from maybe understanding if a market is likely to take off in 1 direction on a certain day. 

But if there is a way i would love to learn how.


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## Client (24 February 2010)

Jack.c said:


> As a shorter term trader, I am really not too sure how to use fundamentals to help my trading, apart from maybe understanding if a market is likely to take off in 1 direction on a certain day.
> 
> But if there is a way i would love to learn how.



There are so many fundamentals around that you won't be able to analyse and take to attention all of them. Technical analysis is the only option for a short term trader, IMHO.


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## Pivotonian (24 February 2010)

SmellyTerror said:


> "Only" 5% on a spec? The damp slap you just heard was the sound of my sphincter clenching in terror.




He's talking about only 5% of total capital allocated to (*probably several*) spec trade*s*.

Helps to read the post you're quoting.  Also sometimes helps to read the earlier posts in a thread - this exact point was dealt with a few posts up.


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## motorway (24 February 2010)

Here are some backtested results of a simple formula screen on US markets

http://info.formulainvesting.com/results/




> What is this Magic Formula?
> 
> The Magic Formula seeks to identify “good” businesses selling at “bargain” prices. *It uses two factors to rank stocks* so that you can identify the best businesses selling at bargain prices.
> 
> ...






The Little Book
That BEATS The MARKET
by Joel Greenblatt


In some ways I  think a  simple scan might be better..
esp If then using Trend _Identifying _Techniques ...



Motorway


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## Gunslinger (22 May 2010)

Idiode said:


> ...
> Now using the *Australian Stock Market Scanner *as another tool thanks to your input.




Thanks Idiode, now google brought that up for me 

Cheers,

JB


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## Wysiwyg (22 May 2010)

> Now using the Australian Stock Market Scanner as another tool thanks to your input.



Please note the data is not kept up to date at this resource.


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