Speculative Stock Portfolio

[Zaxon]

The main reason MA's are not particularly good for trade management in terms of Stop Losses etc is that they behave poorly in range bound or sideways price movement. Therefore the MA based SL will be hit as soon as the price goes sideways or stalls for a while

I'll offer an alternate view point. One type of loss, is the loss of opportunity. If share XYZ goes sideways in a bull market, it's dead money. There are better opportunities out there. One advantage that an MA has over a stop-loss, is the MA will "call out" stocks that are stagnating, allowing you to move on. By contrast, a stop-loss will let you sit in a sideways moving stock forever.

 

[willoneau]

If the stock pay's dividends it isn't dead money, but i know we are talking specy stocks.

 

[aus_trader]

Yes agree with both of your views. If I wish to hold a dividend paying stock for the medium to longer term I don't want it exited just because it goes sideways for a while. On the other hand, Zaxon has a good point about the stagnation of your money holding on to stocks that don't pay dividends if they go sideways for months and years.

 

[willoneau]

Agreed, so a timing exit is then needed too?

 

[Zaxon]

If I wish to hold a dividend paying stock for the medium to longer term I don't want it exited just because it goes sideways for a while. On the other hand, Zaxon has a good point about the stagnation of your money holding on to stocks that don't pay dividends if they go sideways for months and years.

All very true. The "true" measure of return is Total Return, which is a measurement that combines price rise and dividends into one number. But good luck being able to plot TR to run an MA, etc, against it. To my knowledge, brokers' graphing software doesn't have that.

 

[Trav.]

If you look at Skates 'Dump it here' thread you will find reference to a stale stop that he uses, which I believe is based on ROC(period)... period can be optimised for daily / weekly systems

 

[Zaxon]

If you look at Skates 'Dump it here' thread you will find reference to a stale stop that he uses, which I believe is based on ROC(period)... period can be optimised for daily / weekly systems

If you're going to use stops for exits, a "stale" test makes sense.

Really though, I think it's about using the right tool for the job. A stop-loss is the perfect tool for capital preservation. I'm only prepared to lose %x on the trade. I'm setting a break even stop. It could be argued that MAs (or some other indicator that has a time component) is intrinsically a better fit for a regular exit. If so, there's no need for stale stops.

 

[rnr]

If you look at Skates 'Dump it here' thread you will find reference to a stale stop that he uses, which I believe is based on ROC(period)... period can be optimised for daily / weekly systems

@aus_trader
As a follow up from Trav's post could you provide the ticker/ASX symbol for the stock which forms the basis of the chart in the post below so that a 50 period ROC indicator can be added for comparison purposes.
https://www.aussiestockforums.com/threads/speculative-stock-portfolio.33280/page-6#post-1030800

Cheers,
Rob

 

[aus_trader]

@aus_trader
As a follow up from Trav's post could you provide the ticker/ASX symbol for the stock which forms the basis of the chart in the post below so that a 50 period ROC indicator can be added for comparison purposes.
https://www.aussiestockforums.com/threads/speculative-stock-portfolio.33280/page-6#post-1030800

Cheers,
Rob

I have been reading Skate's thread, it is an encyclopedia of information and food for thought. Great work from Skate and all the contributors.

I haven't looked deeply into ROC (Rate Of Change) indicator but might have a look into it. Also the simple idea suggested earlier by Zaxon is also intriguing, to use a Moving Average with an offset. The idea is to allow sufficient wiggle room so that the MA doesn't come to touch the price during short periods of sideways/ranging markets.

 

[rnr]

@aus_trader
As a follow up from Trav's post could you provide the ticker/ASX symbol for the stock which forms the basis of the chart in the post below so that a 50 period ROC indicator can be added for comparison purposes.
https://www.aussiestockforums.com/threads/speculative-stock-portfolio.33280/page-6#post-1030800
Cheers,
Rob

@aus_trader
My apologies as the link above was incorrect as it was meant to link to your post #280 above.

I was hoping that you could provide the ticker/ASX symbol for the stock which forms the basis of the chart in the your post #280 above so that I could add a 50 period ROC indicator for comparison purposes.

Cheers,
Rob

 

[aus_trader]

@aus_trader
My apologies as the link above was incorrect as it was meant to link to your post #280 above.

I was hoping that you could provide the ticker/ASX symbol for the stock which forms the basis of the chart in the your post #280 above so that I could add a 50 period ROC indicator for comparison purposes.

Cheers,
Rob

Hi Rob, That chart was just to illustrate the differences of Moving Averages. The MA's were not applied to an ASX stock. It was done on EURUSD currency on a Daily time frame. I will attach a full screen, that shows that.

 

[rnr]

@aus_trader
My bad as I thought it was an ASX stock that you had used to draw the various MA's on.
Never mind...back to the drawing board as the MT4 platform I use doesn't have a ROC indicator to use as a comparison.
Cheers,
Rob

 

[aus_trader]

Some encouraging news out on one of the recently added spec's in this portfolio Orthocell Ltd(OCC). It is getting some validation in the regenerative medicine / cell repair area of biotechnology which has a lot of future potential in my opinion.

 

[aus_trader]

After a brief rally Duxton Water Ltd(D2O) has formed a Head and Shoulders pattern and therefore decided to sell out of it today.

Bought a speculative stock that I had a bit of success in the past Digitalx Ltd(DCC). The conditions are in place again for a possible rally in this stock, see below:



Open Portfolio:


Closed:

 

[aus_trader]

Seven West Media Ltd (SWM) has fallen below the support levels and was put on the chopping block.

Closed:

 

[aus_trader]

A possible bottoming out stock that has had glory days in the past is Mesoblast limited(MSB). Came across this stock when doing further due diligence and research on my other biotech in the same area of cutting edge regenerative medicine field Orthocell Ltd(OCC).

MSB has so many years of experience and clinical trials already completed in this field with Drugs in the latter stages of being approved with the FDA etc. So I think most of the possible bad news is factored into the share price which is at the low's historically speaking. Therefore the upside has much higher probability than further downside IMHO, so bought in.





Open Portfolio:

 

[aus_trader]

Not having any luck with the penny stocks these days. I had a very good run with Digitalx Ltd(DCC) in the past in this portfolio when BitCoin went onto around US$20,000 last time around. This time BitCoin was rallying hard and was just over US$11,000 when I bought DCC. due to the sharp reversal of BitCoin back towards US$9800 DCC has fallen sharply and was sold today.

Looking at dividend paying stocks, a world away from the penny stocks, I came across a stock that some of us might have purchased products from and not even aware of. The products are probably more familiar to the ladies/women who are more into cosmetics and wellbeing since the main distribution channels are through chemists such as Priceline Pharmacy and Chemist Warehouse. They offer a broad range of products, some shown below.


Company is McPherson's Ltd(MCP) and they've been around for a very long time, established 1860. Below is a summary.

The company valuation is cheap in my opinion and the dividend offered is very attractive. The other thing that attracted me to this stock as opposed to a lot of other retailers in the Aussie landscape is due to the push into online space by MCP. Unlike others MCP has been proactive getting their products online and sales are coming through nicely from online as well as through traditional means.

Open Portfolio:


Sold:

 

[jjbinks]

I like your thinking with DCC. What was your sell trigger?
Any thoughts as to why it hasn't got much of a boost with bitcoin rally compared to late 2017 early 2018

 

[aus_trader]

I think the trend is fairly established: punish the savers and reward the borrowers. That's what seems to be the message from the continuous rate cuts including the latest one which puts savers and retirees with interest income close to zero.

As a joke: At this rate as the trend continues, I'll be borrowing a few million once the interest rate goes below zero (-ve) so that the banks have to pay interest to borrowers in theory

Anyway on a serious note, not taking any sides here as the conversation could get really lengthy, just accepting the reality and looking for ways to play it. So how do we play this ?

I think the intermediate threat to the housing decline is fixed (or at least patched up), so borrowers can continuously pile into the property market and this is the vibe reflected in the major bank shares. What else is needed for this insatiable thirst for Aussie housing ? Well, if you look at all the fringes of every major city, there will be new housing developments as far as the eye can see expanding into the countryside and farmland. All these houses require furniture, fittings, whitegoods (fridges/freezers, washing machines/dryers, dishwashers), microwave ovens, air conditioners/heaters as well as electronic goods such as TVs, PC's, Tablets etc. Even established houses are going with the latest trends so 'out with the old and in with the new' right?

I think a retailer that can sell 'everything under the one roof' could benefit here. Therefore I have picked up some Harvey Norman Holdings Limited(HVN) shares, which could continue to benefit. Price has already pushed higher from the $3 lows. Unlike with MCP, I don't think I need to provide any information about Gerry Harvey's famous Aussie retailer. Current Dividend Yield: 6.5%.

Added to portfolio:

 

[aus_trader]

I like your thinking with DCC. What was your sell trigger?
Any thoughts as to why it hasn't got much of a boost with bitcoin rally compared to late 2017 early 2018

It's a good question jjbinks. I think there must be a reason outside of my knowledge that has made the co-relation between the Bitcoin price and DCC price diverge this time. In fact I was surprised to see that DCC hadn't rallied with Bitcoin this time round. If Bitcoin continues to rally, it might be worth to watch DCC's price action...