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The markets always turn when you least expect it
I was saying at Friday's seminar that the markets always turn when you least expect it. Just when you feel you've had enough and never want to touch them again they turn.
Of course usually after you sold off and were mainly in cash! For example the markets turned in March 2009, no-one expected that. The more fear there is around and the more scared you are the more likely they are to turn. As I said, just after you decided: "I'm out!"
Well, they have turned this week and today banks across the world took coordinated action. Lending should be easier and so some of the fear currently in the markets could ease.
Of course the market has had a good run this week and could just as easily sell off again, I have no idea but at least and at last some action is being taken which might shore up share prices. So of course they may have made a turning point - but equally they may not!
Let's hope we see more bold action. If fear just goes, then the idiotic freeze in doing business will end.
Two trades I'd been patiently waiting for for some time both hit the kind of price area I was looking for, and they both as luck would have it, happened live at the seminar when I made both trades live.
At seminars I try and teach you must have a trading plan and try and stick to it. Often I devise a trading plan and wait patiently and often don't enter a trade for a long time until I am ready to execute it.
I've been waiting to repeat the successful recent trade in Dominos Pizza (LON:DOM) for a while and patiently, very patiently was waiting for my trigger price to buy in, 383. Why?
Well I last traded this at exactly that price - and this is the price where so far it falls to then always rises. I always felt an easy trade.
If support at 380 fell that is bad news and I could simply exit the trade for a very small loss - however if the 380 support held, there could be another good upside and another very nice trade.
Amazingly it fell to 383 on Friday morning just as I brought it up live at the seminar so I gratefully bought in, at 384. I think someone asked a question and I missed the 383!. But a point higher will do.
My trading plan was to target the 450 area on this trade, however, even better if I could get nearer 500, we will see. At the moment the plan is already working well. The tough part will be if the price starts to fall half way through the plan, ie if it gets to 420 then falls. I could then take part profits - now it's all down to level 2.
I bought two tenners on a spreadbet live at the seminar and on Monday really went for it and in reality bought another £30 a point plus 1,000 shares !
Another one I was waiting for was a buy of Supergroup (LON:SGP) in the 430s. And again it hit this price on seminar day so I bought in at 434 on a spreadbet.
Why? Several reasons. I think the fall is overdone, it only trades on my metrics very lowly, it has a huge cash pile and on the day of the last announcement it shot up to 700.
It fell because an analyst slapped a sell on it because it wasn't doing well on google. What kind of stupid reason is that? And it will only take someone to put out a buy note on it for it to whizz higher. I think all the bad news of warehouse problems and warm weather is easily in the price and it's worth nearer 600.
Finally there is big support in the low 430s so again a bet to nothing. If it falls much below 430, I'd have to agree something is wrong and take a small loss, but the risk reward ratio here is very much towards reward!
I've bought back Afren (LON:AFR) this time at 78. I talked about this last time, with support at 75 it seems worth a try, targetting somewhere in the 90s this time. As an oiler of course there is risk to it.
I lost a few quid on SportingBet (LON:SBT) last time I tried to trade it. I've tried a new entry point this time with a very tight stop so if it doesn't work out, should only be a small loss. Back in at 29.9 for 10,000 shares. They reported today, looks fine and undervalued but can there be much new downside?
And I've been wandering around a few bombed out shares and noticed out of favour Yule Catto (LON:YULC) sitting near a low point. It looks mighty cheap now so I grabbed some at 152 and on a spreadbet at 153. They really can't be worth much lower and targetting a medium term rise nearer the 180-200 area especially if there is a santa rally.
I bought back into Gulf Keystone (LON:GKP) on a spreadbet for £20 at 162. Bid rumours on this one which I take with a pinch of salt! And Dignity (LON:DTY) looks in an 800-850 trading range, got some live at the seminar at 808 for a quick play to 840ish.
A funny tale to report, a "fat finger" trade by me has made me a profit I don't deserve! The Imagination (LON:IMG) short was going well, indeed it was at my target of around 400. I was too busy at the seminar on Friday and hadn't noticed as didn't get the time to look at it. However by Monday it was storming higher with the up market and I came out at 430 to take a small profit of £90 instead of the near £400 I could have had.
However today I suddenly saw Imagination was still in my spreadbet account. I thought "Bugger I thought I had closed it but I hadn't..." Then I saw I was long! Instead of closing the trade out for the same amount my fat finger must have "bought back" more than I had and so I was now long! Which was great as I am now up £1,300 by mistake. Obviously I won't add this total luck to the website and think I ought to close it soon anyhow and grab the profit! I've taken the last lot of profit on Chime (LON:CHW) at 183.75 for a profit of £2,452.
Right, time for a look at the portfolio highlights:
In general it has risen nicely again in the last week.
I guess this week's highlight is the wonderful
Coastal Energy (LON:CEO) which today has put out yet another encouraging drill report - yet more oil on the way by the look of it. This good news story just keeps getting better and better and I am looking for well over a tenner here, perhaps up to 1400 now - I've now pretty much doubled on the first buy not that long ago and nicely up on the topup. Fantastic share. I have roughly £70,000 ish worth in real life so this is going very well for me, and if it can double again from here I will be sitting pretty and tax free in the isa.
The Carpetright (LON:CPR) short continues to go very well, now collapsed to 400, still targetting 300 ish which would bring in a fantastic profit. Up a bit today of course with the market rally.
The Ocado (LON:OCDO) short also continues to gradually drift down: I keep wondering whether to bank the rest of the Ocado short as there is a profit there of more nearly £4,000 It doesn't go up much with the main market but wonder if I am being too greedy expecting any further falls. Well, as it is still falling may as well try and get a bit more.
MS International (LON:MSI) has gone nicely higher after its excellent news last week.
Telecom Plus (LON:TEP) has soared to another high today - looks good, in particular the dividend rise of 25%. This is my big income earner, with more than £300,000 worth in real life the yield brings in a fantastic income every year - I should pick up around £13,000 in divs in the net year. Total profits here are well in excess of £90,000 and way more than that personally - plus all those lovely dividends.
A fantastic report from Kentz (LON:KENZ) last week, all on track - some huge contracts, plenty of visibility, long-term work and a whole heap of cash - this ought to hold up if the market tanks further and still looks very cheap - I hope this will be a big winner in 2012. Stuck around 460 for the moment.
BTG (LON:BGC) is up and over three quid today and remains a nice doubler.
CML (LON:BGC) begins a rise again - and there are some hints in the statement that look interesting about next year, maybe something they can't explain fully but looks like there is some confidence about the markets they are in. I also wonder whether this looks like a potential takeover story, a bigger rival could easily buy this out for loose change.
Entertainment One (LON:ETO) looks like it will stay where it is for a bit. I actually think a bid is now in this one for next to nothing! To me the shares are pretty much worth 190-200 quid each without a bid and I would now imagine any bidder would have to pay nearer three pounds than 250.
Long-term superstar Dialight (LON:BGC) remains where it is for now. But it is in a rapidly growing market. Much is in the price admittedly but with patience there is a tenner to come. Well, I have been patient all the way from 150p to 750 and as those of you who have to my seminars have seen from my accounts my profits in real life are something like £70,000. For the website profits are more than £40,000 - and of course there have been dividends on top.
I tend to forget about little LOQ (LON:LOQ) but it has made me some very super profits and indeed I haven't looked at it for months except noted the share price stays strong.
Overall I'm pretty happy with everything as it stands and some decent money has been coming in. I have no idea what happens next through and will try and go with the flow.
Biggest three winners in the portfolio are: (rough profits!)
1. Telecom Plus (LON:TEP) profit £92,000
2. Dialight (LON:DIA) profit £43,000
3. Microgen (LON:MCGN) profit £27,000
(which doesn't include thousands of pounds worth of dividends from all three!).
