Relative value trading
- Thread starter nioka
- Start date
Sold TAS at 5.8c, bought EDE at 7.4c. Now hold 37,250 EDE.
Due to the market and the falling price there has been only a holding position as regards overall value during this latest trading but there has been a fair increase in the number of shares held.
Anyone following????
Due to the market and the falling price there has been only a holding position as regards overall value during this latest trading but there has been a fair increase in the number of shares held.
Anyone following????
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Sold TAS at 5.8c, bought EDE at 7.4c. Now hold 37,250 EDE.
Due to the market and the falling price there has been only a holding position as regards overall value during this latest trading but there has been a fair increase in the number of shares held.
Anyone following????
How's the return going on the original $1k starting amount?
Quietly.
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I should have added; It is not just today's value. What is important is the increase in the number of the shares held. This increases the potential gain if the company eventually succeeds and gets to profitable production. Remember in this case we have EDE with immediate hot prospects and EDE is close to half owned by TAS while, in theory at least, the value of the EDE shares that TAS owns exceeds the Market cap of TAS.
skc
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37250 X 7.4c = $2756
You shouldn't compare to the general market... a better comparison is to just holding either one of these shares.
When you started you could have bought $1000 worth of EDE @ 4.3c or TAS @ 2.4c.
With EDE your stake would now be worth 7.9/4.3 x $1k = $1,837. Profit = $837.
With TAS your stake would now be worth 5.5/2.4 x $1k = $2,292. Profit = $1,292.
So your switching (profit $1,756) has outperformed holding either one on its own... by a lot. Good stuff.
SKC,
The aim is to increase the holding. As the market fluctuates there are times when the value of the holding can fall, often does. In the past my best results have been when the market was at the bottom, at the peak of the last big financial crisis. Both shares are off their recent peak and the holding two weeks ago was worth more than the new holding today. At this stage I just aim at increasing the number of shares held and disregard the actual overall value. If the SP falls, halves, but I can double the number of shares then I do not lose. On the other hand if the SP doubles and I have double the number of shares then I'm smiling.
The aim is to increase the holding. As the market fluctuates there are times when the value of the holding can fall, often does. In the past my best results have been when the market was at the bottom, at the peak of the last big financial crisis. Both shares are off their recent peak and the holding two weeks ago was worth more than the new holding today. At this stage I just aim at increasing the number of shares held and disregard the actual overall value. If the SP falls, halves, but I can double the number of shares then I do not lose. On the other hand if the SP doubles and I have double the number of shares then I'm smiling.
I should add that logic also has to be ignored at times. With the MC of EDE at around $70m and TAS at only just over $15m it is not logical to trade TAS for EDE. My next trade naturally will be to do just that but the gap will have to be reduced a little.
I haven't reported for awhile. The position this week is that the holding now is 85,000 EDE valued today at $5865. There have been some great opportunities to trade between the two as there have been wide fluctuations in the relative values. With TAS narrowing the gap this week it may be some time before an opportunity to switch back to TAS from the EDE holding.
I haven't reported on this subject for some time. Here is an update.
Because of the success with EDE and edencrete there has been plenty of opportunity to trade between EDE, EDEO and TAS. In short the shares held now are 299372 TAS valued on Friday at $22153. Not a bad return on $1000.
Anyone sharing the joy?
Because of the success with EDE and edencrete there has been plenty of opportunity to trade between EDE, EDEO and TAS. In short the shares held now are 299372 TAS valued on Friday at $22153. Not a bad return on $1000.
Anyone sharing the joy?
I haven't reported on this subject for some time. Here is an update.
Because of the success with EDE and edencrete there has been plenty of opportunity to trade between EDE, EDEO and TAS. In short the shares held now are 299372 TAS valued on Friday at $22153. Not a bad return on $1000.
Anyone sharing the joy?
More joy today with TAS up another 12%
skc
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I haven't reported on this subject for some time. Here is an update.
Because of the success with EDE and edencrete there has been plenty of opportunity to trade between EDE, EDEO and TAS. In short the shares held now are 299372 TAS valued on Friday at $22153. Not a bad return on $1000.
Anyone sharing the joy?
So you started with 11772 TAS and 15000 EDE which at today's prices are worth $977 and $1800, or ~$2,800 in total. Or about 33750 TAS shares @ 8.3c if they are simply all TAS.
But with switching you managed to grow your number of shares in TAS to ~300k.
That's pretty amazing. I guess the 6 months downtrend to Jan would have tested holders faith in the stock and offered plenty of switching opportunities.
Are you able to offer a table showing the historical switching?
Sdajii
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Very impressive, nioka. I remember a few years ago when you had similar success doing the same thing with AUT and EKA. My own strategy back then at least for the most part was simply to buy the undervalued stock and sit on it. I did well buy you did better.
Thank you very much for posting your actions and sharing the story, and congratulations!
Thank you very much for posting your actions and sharing the story, and congratulations!
The down trend earlier in the year offered many more trading opportunities as the recent uptrend. It is the uptrend that has put the value in the shares. It is, as the title suggests, trading relative values and ignoring the SP. I have used the formula where 1 EDE is worth 1.4 TAS and value EDEO at 1 EDE - 3c (conversion price) + 10% (value of leverage, based on the fact that you get more skin in the game for the same outlay). I will make trades if, after brokerage, I end up with more shares than I had before the trades. It works about 80% of the time.
There have been hundreds of trades, sometimes 4 or 5 daily. I don't have the time to go back and catalogue them. The more volatility the more opportunity. EDE is always the first to react and the other two usually follow. If EDE goes up I can often sell EDE and buy one of the other before they react and later sell them, buy back the EDE and end up with more. As the numbers have increased I have been able to trade larger numbers but I try and trade between 30,000 and 50,000 at a time. More than that can affect the price as there is not great volume available as a general rule.
Years ago I posted similar trading with three oil explorers that had different percentage holdings in the same oil prospecting lease in the USA. I traded to a point where I was in the top 20 shareholder list. I was doubted by some on ASF who couldn't believe the result. I ended up posting the holding records. I wont go through that again.
Today I bought 50,000 TAS at open for 7.8c, they closed at 9.0c. I decided to hold. I bought 50,000 EDEO at open for 8c, they closed at 9.4c. I decided to hold these also. With trading moving settlement from t+3 to t+2. There is not as much time to settle so I may just hold these without making a trade in this instance.
I'm busy looking for another group of penny stocks with similar characteristics to start again with another $1000 kitty. Any suggestions?:1zhelp:
Note that I do post on another forum with a different monicker.
Those shares today are worth $35,924.64. And room to improve in the very short term.The down trend earlier in the year offered many more trading opportunities as the recent uptrend. It is the uptrend that has put the value in the shares. It is, as the title suggests, trading relative values and ignoring the SP. I have used the formula where 1 EDE is worth 1.4 TAS and value EDEO at 1 EDE - 3c (conversion price) + 10% (value of leverage, based on the fact that you get more skin in the game for the same outlay). I will make trades if, after brokerage, I end up with more shares than I had before the trades. It works about 80% of the time.
There have been hundreds of trades, sometimes 4 or 5 daily. I don't have the time to go back and catalogue them. The more volatility the more opportunity. EDE is always the first to react and the other two usually follow. If EDE goes up I can often sell EDE and buy one of the other before they react and later sell them, buy back the EDE and end up with more. As the numbers have increased I have been able to trade larger numbers but I try and trade between 30,000 and 50,000 at a time. More than that can affect the price as there is not great volume available as a general rule.
Years ago I posted similar trading with three oil explorers that had different percentage holdings in the same oil prospecting lease in the USA. I traded to a point where I was in the top 20 shareholder list. I was doubted by some on ASF who couldn't believe the result. I ended up posting the holding records. I wont go through that again.
Today I bought 50,000 TAS at open for 7.8c, they closed at 9.0c. I decided to hold. I bought 50,000 EDEO at open for 8c, they closed at 9.4c. I decided to hold these also. With trading moving settlement from t+3 to t+2. There is not as much time to settle so I may just hold these without making a trade in this instance.
I'm busy looking for another group of penny stocks with similar characteristics to start again with another $1000 kitty. Any suggestions?:1zhelp:
Note that I do post on another forum with a different monicker.
Those shares today are worth $35,924.64. And room to improve in the very short term.
Good news for EDE and TAS today. Those shares today are worth $47,899.52
A calculation done today shows that had I held the original purchase the shares would be worth $5643. Still a good return but through trading one against the other they are today worth $53,886. Trading allows this snowball effect.
All aided by splendid results by EDE with edencrete.as discussed on the EDE thread.
Opportunities like this are few and far between. Over the years I have only found three. All discussed on this forum. The first was EKA. AUT and VPE. The three of them had varying percentages in the same oil prospect. I traded them to a point where I was a top 20 shareholder. Then there was CER and CNP where one was the trading company and the other owned the bricks and mortar. Now there is the EDE and TAS combo and here the fat lady is yet to sing.
All aided by splendid results by EDE with edencrete.as discussed on the EDE thread.
Opportunities like this are few and far between. Over the years I have only found three. All discussed on this forum. The first was EKA. AUT and VPE. The three of them had varying percentages in the same oil prospect. I traded them to a point where I was a top 20 shareholder. Then there was CER and CNP where one was the trading company and the other owned the bricks and mortar. Now there is the EDE and TAS combo and here the fat lady is yet to sing.
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