portfolio vital statistics · 2018-05-05 · 3 hour investor newsletter incorporating the...

3 Hour Investor Newsletter incorporating the “Newsletter Portfolio” Year 2. Week 47-2018-Apr-28

Portfolio Vital Statistics

• Commenced on 10 June 2016 with $250,000.

• Sat on cash for awhile then first stocks purchased in

week of 7/7/2016

• Now worth $380,143

• Total Portfolio performance since inception 23.80% pa

• Performance on funds invested in securities since

inception 31.47%

• Cash in portfolio $2,445 …”almost fully invested”

Mea Culpa. I made a mistake and have fixed it. I “bought” slightly too many

shares of RHL and JIN recently (less than 100 shares too many). Result was

that theoretical cash went below zero by about $200 (which should of course

not happen). So I slightly cheated by reducing the purchased number of

shares by a very small about (until a cash balance was kept above Zero.

Sorry.


Current Portfolio Valuation.


Since Inception performance table

Performance since inception (PA) incl divs

Newsletter Portfolio (including cash)

23.80%

Stocks in portfolio

31.47%

XJOAI

13.16%

Star Growth Stocks 11.29%

Star income stocks 11.18%

Comment. We currently have 17 securities and about $2,000 in cash …Close to fully invested. No

transactions since 17 March

Losers >10% -

Losers 5.1%-10% -

Losers 0%-5% -

Gainers 0%-5% 3

Gainers 5.1%-10% 5

Gainers10.1% - 20% 3

Gainers 20%-30% 2

Gainers 30%-50% 1

Gainers 50%-80% 2

Gainers >190% 1

Portfolio comment.

• 14/17 stocks closed green for the week

• All stocks are in hold territory. All look quite safely above potential sell signals


Status of US and Aus Markets.

Green RED

USA DJA 1

USA S&P500 1

USA Nasdaq 1

USA Russell 2000 1

USA VIX (inverted (means Green is shown as RED)

1

USA DJA Futures 1

USA S&P 500 Futures 1

USA NASDAQ Futures 1

USA Russell 2000 Futures 1

Aus XAOAI 1

AUS XMD 1

AUS XSOAI 1

AUS XVI (Vix) (inverted) 1

Mostly Green……To me this feels like a green light to buy…especially if the USA futures are green by

say 1pm on Monday


ASX Indices with ROAR above 20% and above 10%

ASX indices which closed the week with ROAR 6month) above 20%. (purpose of this section….if an

index is going up…perhaps consider looking at its component stocks to check for anything worth

buying).

Indices growing > 20% ROAR 6month or over 10 but under 20%

Over 20%

Over 10%

XAOAI. All ords Total return

XDJ Consumer Discretionary

XEC Emerging Companies

XEJ ASX 200 Energy 1

XFJ ASX 200 Financials

XGD ASX 300 Gold

XHJ ASX 200 Health Care 1

XIJ ASX 200 Info Tech

XJRAI ASX 200 Resources TR 1

XMD Midcap 50

XMJ ASX 200 Materials

XMM ASX 300 Metals and Mining

XNJAI ASX 200 Industrials

XPJ Property Trusts

XSJ Consumer Staples 1

XSOAI Small Ords TR

XTJ Telecommunications

XUJ ASX 200 Utilities

Comment.

Looks to be a bit of green

creeping into the market.

If you’ve been in energy

or health or resources

your portfolio has

probably done ok


VALUE index update

Let’s call the value index. How it works: Filter stocks with the following criteria

1. Financial health = strong or satisfactory

2. Dividend yield >2.5%

3. PE <15

4. Price to NTA per share above zero and under 5

5. Enterprise value above $500m

6. Excludes mining stocks and most financials (as advised by Alan Hull)

• We search for (a) sharp increase or (b) decrease in stocks found by this filter.

• If there are many stocks here then “buying value stocks might be a good strategy”….

• If there are few perhaps it indicates we’re at the top of the market?

From this search the following stocks are possibly worth a look: BKW, CSR*, GNC, TGH, WHC

Comment. Graph still flat…(sorry for gaps)…prediction…one day this chart will move strongly

up…who knows when…but we’ll see it here.

0

2

4

6

8

10

12

14

16

18

Search for Value count


Selling and Buying Report. No buys or sells this week. No transactions since Mid March…a nice comfortable place to be


Stocks worth assessing as suitable for

purchase if conditions are right this week There are loads of things to check out on these lists. I suspect that if you had a portfolio made up of

any 30 of these stocks you’d have had a decent run in the past few weeks

Basic Strategy securities

ETF Strategy

Large Cap Strategy Lincoln Stocks Strategy

Value+Market Strategy

HACK

You can safely assume that I either own the above stocks or are thinking about adding them to my

holdings. There are some here with ugly historical stories (look at TLS for example)…and yet they are

still on my list. (note I’d aim to buy no more than 3% of my portfolio in buying such stocks…so even

if they go down the exposure to my overall portfolio would be small.

3 Hour Investor Newsletter incorporating the “Newsletter Portfolio” Year 2. Week 47-2018-Apr-28 Strategies explained. Each strategy attempts to find stocks or ETFs that meet the following criteria.

(a) Acceptable Fundamentals

(b) Acceptable daily trade volume

(c) Acceptable market support at current prices.

Go back and read newsletter Year 2 Week 25 for full description of the strategies


Bonus Charts:

In this section I’ll sometimes list a chart that catches my eye and provide a brief comment.

If you want a stock reviewed, perhaps email me and I might include it (no promises)

Chart Comment

IMD Returns inc divs

5year 3 year 1 year

6 56% 115%%

Strong Stock Prospective PE is 22x Div prospective above 1% gross Dilemma. 2 analysts are forecasting EPSG of 667 (wow). Should I buy. (seems like a decent one to look at for me)

MIN Returns inc divs(approx.)

5year 3 year 1 year

20% 48% 109%

• Star stock

• Div yield prospective > 5% gross

• PE prospective is about 12

• ROA about 24% Seems to have popped back above the buy line. It’s certainly of interest to me.

NHC Returns inc divs(approx.)

5year 3 year 1 year

-4% 6% 44%

• Strong Stock

• EPSG Lincoln 78%

• Div yield prospective > 7%

• PE prospective is about 8x

• ROA forecast 14%

• PEG is 0.11 (very low)

• Daily trade about $328k Price has popped back above “the buy line” and with such a low PE perhaps this stock can appreciate further

3 Hour Investor Newsletter incorporating the “Newsletter Portfolio” Year 2. Week 47-2018-Apr-28 Parting comment

Another nail in the Aussie property bubble?

Over the past couple of years we’ve seen many straws being added to an “overloaded camels back”

I guess I’m trying to say that the Australian property bubble seems to be facing a strong headwind

and perhaps at best is unlikely to continue. Examples

• Increased restrictions on foreign buyers, including increased stamp duties and more careful

scrutiny of who’s buying

• Increased taxes such as stamp duty changes for off the plan buyers, eliminating depreciation

on buyers of second hand properties and announced “vacant property taxes” etc

• Increases in interest rates (initially for property investors)…but also for others .

• Threats of increased interest rates (eg we can see that US rates are rising which puts

pressure on local bank rates)

• Pressure by funders of construction loans to refinance (eg from Maquarie to a Chinese

funder)

• Increased scrutiny of all property loan applications

• Reduced commissions for mortgage brokers (perhaps some will leave the market?)

And how does the above graph apply? Well anecdotally I’m being told that buyers who (for

example) had $800,000 of mortgage loans approved say one year ago…when they go back to the

bank upon completion of an investment apartment build…are finding that the bank is now offering

them a lot less…say $650,000 when it comes time to settle.

What this graph implies (its from today’s Age Newspaper…full credit to them)…is that a family with

$100,000 net income used to be able to get a loan for about $500,000 and now only qualifies for say

$380,000 (down about 24%...and this reduction is even higher with bigger loans). If this is

true…there’s simply less money available for people to borrow to spend on properties and if there’s

less money available perhaps this means property prices will decline. So far it seems prices have

simply stagnated (note I’ve not done any research myself…just based on what I read in the press…so

take this with a grain of salt).

3 Hour Investor Newsletter incorporating the “Newsletter Portfolio” Year 2. Week 47-2018-Apr-28 What does this all mean. Who knows?....however if property prices do go into decline that’s not a

good thing for an investor banking on rising share prices. What will I do differently?...I’m just going

to stick to my formulae of paying close attention to sell signals and to be careful in entering the

market. I still think I have to expose my capital to the markets…not sit on the sideline. (note that I

will however also in the background…quietly prepare my downmarket strategy so that it’s ready to

dust off when required).

How about these charts of overseas exchanges. Looks like a fairly strong bounce back?

What do you see when you look at the graphs?

It looks to me that there was a fair bit of selling which has suddenly reversed and was followed with

several weeks of gains. What will happen next? Who knows.

next…not me that’s for sure)

What does it all mean? This is my message to myself

• Stick to my sell signal process. Go to 100% cash if required

• Don’t assume I can understand the market, or even individual stocks…they are simply too

complicated to understand. Every holding is an experiment to be proven right or wrong by

the market.

• Buy good quality stocks that have market support and let them run for as long as they

appreciate.

• Be disciplined…check for sells daily…check for buys weekly.

• If there’s nothing to buy…don’t chase…just wait. If there’s something to sell…don’t

wait…sell. (note to self…read this sentence a few times and pay attention…I can see that

I’ve been guilty of breaking this rule last week!)

What’s your plan?.

• Can you describe it clearly.

• Can you write it down.

• Can you follow it with discipline.

• Do you know if you’re following your plan or straying?

If you don’t have a written plan what is the very first thing you can do to make the plan more

concrete, clearer and likely to be followed? Can you do that first thing today?


• Warning. This newsletter is provided for your entertainment only, I’m not a financial adviser, I have not taken account of your objectives, financial situation or needs. You should therefore consider the appropriateness of any descriptions of my Newsletter and its newsletter portfolio in light of your objectives, financial situation and needs, before taking any actions.

• All views and information expressed in this newsletter are not the views of Lincoln and or its directors, agents, representatives and employees.

• Many of the graphs and screen shots are taken from Lincoln services and are fully credited to them. I’m a paid up licensee to Lincoln, otherwise all IP in their system and graphs belongs totally to them. I recommend that you consider signing up to their service…it’s a great service and I feel great value for money!

• I do invest and trade in shares, I’ll usually mark the ones that I own with (** or *)…however it’s safe for you to imagine that I’m either buying or selling just about any stock in the market, particularly and especially if mentioned here.

portfolio vital statistics · 2018-05-05 · 3 hour investor newsletter incorporating the...

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