As I typically do, I had been lightening up on stocks heading into April, as stocks tend to not do well in the April to June time frame (at least, if not the whole summer). For the last little while, I have only been 40-45% invested in stocks, with the rest in cash or t-bills. My main goal at this time is preservation of capital but I also want to have cash on-hand to buy back into stocks when they are cheaper (at some point). Since I trade on momentum, using moving averages, once stocks pick a direction (up or down), I want them to keep going in that direction for at least a few months.
That said, I HAVE some securities in my portfolio right now - mainly ETF's. I am in one UP ETF - for natural gas (HNU) and it has done very well since I purchased it in early March at 12.29 (even with the drop today, it is well over 16.00).
I am mainly in the DOWN ETF's - those that go up in value as the underlying security or commodity goes down. I am currently in the down ETF's for Canadian financials (HFD), the TSX (HXD), oil (HOD) and just today I bought some of the down US S&P (HSD) in anticipation of a correction in US markets. The HSD purchase was made more on sentiment and seasonality than on the moving averages, since HSD is approaching a buy signal but has not reached it yet.
I am also in LW, a retirement home REIT that has a good payout and seems to do well when the markets are in turmoil (presumably because people are looking for yield). I also bought some DEE today - a stock that I had made money on recently and that I bought back at a lower price (1.19) than I last sold it at (1.31) and it actually closed higher today, at 1.24.
I am in no hurry to put any more of my money into action but I may buy more of the down ETF's if this trend continues. For now, I am happy to not only have huge losses as the market corrects, but I actually MAKE some money.
Monday, April 15, 2013
Wednesday, February 6, 2013
First post in a while...
Sorry that I have been neglecting this blog for the last many months (not that there is anyone reading it anyway), but I thought I would update it today since a friend asked me about it.
The markets, in general, have been doing very well so far this year. I am up 4% overall so far this year (in a little over a month), so I am happy with that. Although I follow the moving averages, for the most part, to decide when to buy and sell, when the markets start to hit new highs, I cut back my levels in stocks. For that reason, I am only 20% invested in stocks right now, as I expect a pullback of 5 to 10% to come in the next couple of months. Company earnings have been mixed this quarter, and the market just seems to be overbought.
I have recently moved from using the 40-day moving average to the 50-day MA - it smooths things out a bit and it is a more common time period to use. The stock graphs seem to indicate that many of the stocks I follow adhere better to the 50-day MA as an indicator than they do the 40-day MA.
I do own a few stocks right now - Suncor, MEG Energy, Iron Ore Income Fund, Thompson Creek, and Imperial Oil. I bought Blackberry a couple of days ago when it bounced off the 50-day MA but I sold it yesterday after gains of 12% and 6% in two consecutive days (very volatile stock, so better to take gains when you get them, as it can easily go right back down).
As the markets are high right now, many stocks that I follow are already in 'Buy' territory, so I won't get an indicator to purchase them unless they go down and bounce off their 50-day MA (like BB did two days ago). I AM looking to purchase Silver Wheaton (SLW) and Major Drilling (MDI) today, if they go up through my stop buys (I still buy all stocks on stop buys, to ensure that they have at least a bit of momentum.
Commodities (mostly metals) haven't done too well lately, so many of them are in 'don't hold' territory right now, so if they strengthen they could give 'Buy' signals quite easily. One example of this is SLW right now.
I will try to be better at updating this blog every week or so, with what stocks I am holding at that time, what percent of my money is invested in stocks, and how my YTD return is doing.
The markets, in general, have been doing very well so far this year. I am up 4% overall so far this year (in a little over a month), so I am happy with that. Although I follow the moving averages, for the most part, to decide when to buy and sell, when the markets start to hit new highs, I cut back my levels in stocks. For that reason, I am only 20% invested in stocks right now, as I expect a pullback of 5 to 10% to come in the next couple of months. Company earnings have been mixed this quarter, and the market just seems to be overbought.
I have recently moved from using the 40-day moving average to the 50-day MA - it smooths things out a bit and it is a more common time period to use. The stock graphs seem to indicate that many of the stocks I follow adhere better to the 50-day MA as an indicator than they do the 40-day MA.
I do own a few stocks right now - Suncor, MEG Energy, Iron Ore Income Fund, Thompson Creek, and Imperial Oil. I bought Blackberry a couple of days ago when it bounced off the 50-day MA but I sold it yesterday after gains of 12% and 6% in two consecutive days (very volatile stock, so better to take gains when you get them, as it can easily go right back down).
As the markets are high right now, many stocks that I follow are already in 'Buy' territory, so I won't get an indicator to purchase them unless they go down and bounce off their 50-day MA (like BB did two days ago). I AM looking to purchase Silver Wheaton (SLW) and Major Drilling (MDI) today, if they go up through my stop buys (I still buy all stocks on stop buys, to ensure that they have at least a bit of momentum.
Commodities (mostly metals) haven't done too well lately, so many of them are in 'don't hold' territory right now, so if they strengthen they could give 'Buy' signals quite easily. One example of this is SLW right now.
I will try to be better at updating this blog every week or so, with what stocks I am holding at that time, what percent of my money is invested in stocks, and how my YTD return is doing.
Saturday, May 19, 2012
Enjoying the market slide...
I know that is a bit of a strange title for the post, but recall that I have always said that I don't care is the market goes up or down, as long as it picks a direction and sticks with it for a while. Since I trade on momemtum (using the 40-day moving average), I stand to gain as long as the market (or a particular security) continues to move in the same direction.
In late April and early May, the moving averages told me to get out of stocks and the positive ETF's and then to get into the negative ETF's a few days later. Now, I had been burned on this type of signal before, as the market just lingered and reversed course a few days later back to the positive. In this scenario, an investor who doesn't touch their holdings tends to break even but an investor who follows moving average signals (like me) tend to lose as stocks reverse course (twice, in this case) quickly.
This time, I was happy to get out of stocks (at first) and preserve capital. After a couple of days, though, when it looked like the market would continue to drop, I bought into HBD (to bet against gold bullion), and HSD (to bet against the US S&P index). Both bets have worked well for me so far, and I got out of the HBD a couple of days ago when the price of gold started to rebound.
One commodity, natural gas, has done well over the last little while, and I have enjoyed some gains in HNU (leveraged, so be careful) as the price of natural gas went up. Even though it has a lot more room to recover, I think the time of year is wrong for a full recovery so I got stopped out of HNU late this week.
A new way to profit from a market downtown, the US VIX, or volatility index, is also of interest to me. HVU (an ETF that returns roughly double what the VIX percentage gain / loss is) went into buy territory recently (under $5), so I picked some up. With the HVU price now at $6.51), the percentage gains have been good. While I will continue to play HVU, history indicates that the highest volatility is usually later in the summer (July / August), so the market may bounce positively a bit before then. Either way, my gains in HVU are good enough that I can endure a bit of a slide and still have a profit.
The goal in markets like this is not necessarily to profit (by holding the inverse ETF's), it is to preserve capital by NOT holding the securities that are going down. North American markets were down 3 - 5% this week alone, so by not holding any of these securities, I have saved myself this money. That is not counting the 1.4% I actually MADE this week on the securities above, so my effective return is more like 4.4 to 6.4% for this week alone.
By following moving averages, I will never sell at the top of the market or get in exactly at the bottom. I will, however, benefit from downward moves in the market like we are in now, as share prices (and their moving averages) drop to lower levels. As stocks recover and pass up through their 40-day moving averages, I will get signals to buy them back, at levels much lower than where I sold them. This is why my method is much better than the 'buy and hold' method that most (lazy) advisors employ and try to convince investors is the best way to go. Those that advocate holding dividend-paying stocks through thick and thin should look at this week - overall, investors lost all of the dividend interest return for the ENTIRE YEAR in only this SINGLE week.
So far this year, I am up 4.4% overall. This compares to the TSX at -5.64%. (yes, I am currently beating the TSX return by just over 10%). This compares to the US S&P 500 at 3.86% YTD.
I am not sure if I will get into the inverse ETF's more or not (the HED, HFD, HQD, HOD, and HXD have also done very well lately) but I will remain mostly in cash and wait for things to turn positive again and jump back into stocks and the positive ETF's. For now, I am happy to preserve capital and profit slightly from my investments discussed above.
In late April and early May, the moving averages told me to get out of stocks and the positive ETF's and then to get into the negative ETF's a few days later. Now, I had been burned on this type of signal before, as the market just lingered and reversed course a few days later back to the positive. In this scenario, an investor who doesn't touch their holdings tends to break even but an investor who follows moving average signals (like me) tend to lose as stocks reverse course (twice, in this case) quickly.
This time, I was happy to get out of stocks (at first) and preserve capital. After a couple of days, though, when it looked like the market would continue to drop, I bought into HBD (to bet against gold bullion), and HSD (to bet against the US S&P index). Both bets have worked well for me so far, and I got out of the HBD a couple of days ago when the price of gold started to rebound.
One commodity, natural gas, has done well over the last little while, and I have enjoyed some gains in HNU (leveraged, so be careful) as the price of natural gas went up. Even though it has a lot more room to recover, I think the time of year is wrong for a full recovery so I got stopped out of HNU late this week.
A new way to profit from a market downtown, the US VIX, or volatility index, is also of interest to me. HVU (an ETF that returns roughly double what the VIX percentage gain / loss is) went into buy territory recently (under $5), so I picked some up. With the HVU price now at $6.51), the percentage gains have been good. While I will continue to play HVU, history indicates that the highest volatility is usually later in the summer (July / August), so the market may bounce positively a bit before then. Either way, my gains in HVU are good enough that I can endure a bit of a slide and still have a profit.
The goal in markets like this is not necessarily to profit (by holding the inverse ETF's), it is to preserve capital by NOT holding the securities that are going down. North American markets were down 3 - 5% this week alone, so by not holding any of these securities, I have saved myself this money. That is not counting the 1.4% I actually MADE this week on the securities above, so my effective return is more like 4.4 to 6.4% for this week alone.
By following moving averages, I will never sell at the top of the market or get in exactly at the bottom. I will, however, benefit from downward moves in the market like we are in now, as share prices (and their moving averages) drop to lower levels. As stocks recover and pass up through their 40-day moving averages, I will get signals to buy them back, at levels much lower than where I sold them. This is why my method is much better than the 'buy and hold' method that most (lazy) advisors employ and try to convince investors is the best way to go. Those that advocate holding dividend-paying stocks through thick and thin should look at this week - overall, investors lost all of the dividend interest return for the ENTIRE YEAR in only this SINGLE week.
So far this year, I am up 4.4% overall. This compares to the TSX at -5.64%. (yes, I am currently beating the TSX return by just over 10%). This compares to the US S&P 500 at 3.86% YTD.
I am not sure if I will get into the inverse ETF's more or not (the HED, HFD, HQD, HOD, and HXD have also done very well lately) but I will remain mostly in cash and wait for things to turn positive again and jump back into stocks and the positive ETF's. For now, I am happy to preserve capital and profit slightly from my investments discussed above.
Sunday, April 15, 2012
First Post in a Long Time - Mostly in Cash Right Now
While I don't imagine anyone is still reading my blog, since I haven't posted in over a year, I thought I would try to start posting again. With the markets being pretty jittery these days and with the up and down swings seeming alternating, I have been sitting largely in cash for the last few weeks. I am 84% in cash right now, and almost half of that is in corporate bonds with a good yield (and also a good capital return, it turns out).
For the last few weeks, half of the securities I have been in (and out of) have been negative ETF's - they go up when the markets go down. Most of the stocks and positive ETF's that I follow are in 'do not hold' territory - that is, they are below their 40-day moving average lines.
That said, there ARE a few securities that just said 'Buy' on Friday, so I will try to pick them up on Monday if they continue to rise. They are HSD, LIF.UN, PWF, and HBD. You may notice that two of these securities are negative ETF's - HSD bets against the US S&P index and HBD bets against the price of gold bullion.
I am not expecting any major positive influences on the markets any time soon - there is plenty of bad news coming out of Europe, the US economic recovery looks to be slowing, and we are coming up to the 'sell in May and go away' period of the year. I suspect that most of the securities that I will hold over the next few months will be negative ETF's but the moving averages will tell me what to buy (and sell).
If anyone IS still checking out my blog, I would be very interested to hear what you are doing (investment-wise) and which securities you hold or are looking at buying.
For the last few weeks, half of the securities I have been in (and out of) have been negative ETF's - they go up when the markets go down. Most of the stocks and positive ETF's that I follow are in 'do not hold' territory - that is, they are below their 40-day moving average lines.
That said, there ARE a few securities that just said 'Buy' on Friday, so I will try to pick them up on Monday if they continue to rise. They are HSD, LIF.UN, PWF, and HBD. You may notice that two of these securities are negative ETF's - HSD bets against the US S&P index and HBD bets against the price of gold bullion.
I am not expecting any major positive influences on the markets any time soon - there is plenty of bad news coming out of Europe, the US economic recovery looks to be slowing, and we are coming up to the 'sell in May and go away' period of the year. I suspect that most of the securities that I will hold over the next few months will be negative ETF's but the moving averages will tell me what to buy (and sell).
If anyone IS still checking out my blog, I would be very interested to hear what you are doing (investment-wise) and which securities you hold or are looking at buying.
Saturday, February 19, 2011
Mid-February Update
Well, the markets are sailing along and all is good. All the stories for the last little while have been about the impending correction and it hasn't happened yet. That said, we are bound to have at least a 10% correction soon, although it may not come until May or June, as the typical summer slowdown sets in (last year, April was weak).
For now, I am up 2.1% YTD, so I am on target so far of my 2011 goal of 1% return per month. The overall markets have done better than that but I am never fully invested so my returns are a bit lower (and easier to stomach the ups and downs).
Currently, I am just over 60% invested overall (I was as high as 80% invested in early February). I currently own CP, FTT, G, HBU, HFU, HGU, L, LIF.un, PBN, PGD, PWF, SNC, T, THI, and TRP. There may be more stocks that I will be looking to buy next week as well, but I haven't looked at the moving averages yet this weekend. Monday is a holiday so there is no rush.
I will admit that the thought of a significant correction soon is a bit worrisome but I can't let it make me abandon my investment strategy (or I would have sold everything months ago, and missed out on the recent gains). For now, I will stay the course and just make sure I have stop losses in place for my largest positions.
For now, I am up 2.1% YTD, so I am on target so far of my 2011 goal of 1% return per month. The overall markets have done better than that but I am never fully invested so my returns are a bit lower (and easier to stomach the ups and downs).
Currently, I am just over 60% invested overall (I was as high as 80% invested in early February). I currently own CP, FTT, G, HBU, HFU, HGU, L, LIF.un, PBN, PGD, PWF, SNC, T, THI, and TRP. There may be more stocks that I will be looking to buy next week as well, but I haven't looked at the moving averages yet this weekend. Monday is a holiday so there is no rush.
I will admit that the thought of a significant correction soon is a bit worrisome but I can't let it make me abandon my investment strategy (or I would have sold everything months ago, and missed out on the recent gains). For now, I will stay the course and just make sure I have stop losses in place for my largest positions.
Monday, January 31, 2011
First Month of 2011 is in the Books
Even though the US stock markets have had a good month, the Canadian stocks weren't quite as possitive for me. For January, I am down slightly (-0.24%, so I am pretty much even). I am currently about 65% invested, so I own quite a few equities but I still have alot of cash on the sidelines.
I currently own BCE, BIN, CCO, CLS, COS, CP, ECA, FM, ENF, HFU, HXU, HSE, MBT, PBN, PGD, PMZ.UN, REI.UN, RUS, S, SC, and T. I am up in all but five of these securities at the moment, and only one of them is down more than $100 total since I purchased it (SC, as it dropped $2 per share when it was announced their CEO would be leaving the company).
I was up on CCO the last couple of days so I just doubled the position today. I have decided that I not only want to sell stocks if they start to go down but I also want to buy more of a stock that is moving up nicely. That means that my initial purchase of a stock is meant to be the first half of the position and the stock performance will determine if I purchase the second half or simply sell the first half. It is naive to think that I will buy stocks and they will always go up right away so this protects me by not investing the full amount. This also makes it easier to invest larger sums of money as my portfolio grows, as I never want to own more than 20 or 25 securities at the most.
For tomorrow, there are a few stocks that are nicely in 'BUY' territory - HQU, AGU, LIF.un, and MFC. I will put in stop buys tonight and pick up any of these stocks / ETF's that continue to rise in the next couple of days (I put my stop buys in for two day expiries now, so I have to do less updates). Oil has had a nice run lately and HOU and CNQ both went into BUY territory today but I wait until the second day in buy territory to buy so I will have to wait on those. I already own HSE, ECA, COS, and PBN so I am already well-positioned to benefit from higher energy prices.
I currently own BCE, BIN, CCO, CLS, COS, CP, ECA, FM, ENF, HFU, HXU, HSE, MBT, PBN, PGD, PMZ.UN, REI.UN, RUS, S, SC, and T. I am up in all but five of these securities at the moment, and only one of them is down more than $100 total since I purchased it (SC, as it dropped $2 per share when it was announced their CEO would be leaving the company).
I was up on CCO the last couple of days so I just doubled the position today. I have decided that I not only want to sell stocks if they start to go down but I also want to buy more of a stock that is moving up nicely. That means that my initial purchase of a stock is meant to be the first half of the position and the stock performance will determine if I purchase the second half or simply sell the first half. It is naive to think that I will buy stocks and they will always go up right away so this protects me by not investing the full amount. This also makes it easier to invest larger sums of money as my portfolio grows, as I never want to own more than 20 or 25 securities at the most.
For tomorrow, there are a few stocks that are nicely in 'BUY' territory - HQU, AGU, LIF.un, and MFC. I will put in stop buys tonight and pick up any of these stocks / ETF's that continue to rise in the next couple of days (I put my stop buys in for two day expiries now, so I have to do less updates). Oil has had a nice run lately and HOU and CNQ both went into BUY territory today but I wait until the second day in buy territory to buy so I will have to wait on those. I already own HSE, ECA, COS, and PBN so I am already well-positioned to benefit from higher energy prices.
Sunday, January 2, 2011
Another Year Wrapped Up
Well, 2010 is now officially in the books. I ended the year with a 7.7% return for the year - below my original goal of 1% gain per month but ahead of my revised goal of 0.5% gain per month. I finished behind the 2010 gains for the major indices (TSX, S&P, NASDAQ, etc.) but I only averaged an investment rate of about 50% for the year (with the rest in cash at any given time, ready to deploy), so I had an easier time sleeping at night than if I had all my cash invested and had to put up with the big market swings all year. I finished 2010 near my high for the year (up 8%), which I hit on December 30th.
Going into 2011 (Canadian trading to begin on Tuesday, January 4), I am 33% invested with the rest in cash. I currently own ARE, BIN, HSE, OCX, S, SC, TRP, and YLO. For Tuesday, I am looking at more securities that are in BUY territory - HNU, BBD.b, COS.un, ECA, LIF.un, PWF, and QBR.b. I am also looking at CCO, which is already in HOLD territory and the outlook for uranium looks positive for 2011.
I will also deposit $5K into my TSFA account on Tuesday, to get the money in there as soon as I can. It will be the third year that we are eligible to contribute to the TFSA and the third year that I have done so. My original $10K is up to $12,760 so I have over a 25% return so far (I am am sure there are many people with better TFSA returns, but I am happy with this). I know I won't be able to keep this up every year but after 20 years of putting money into the TFSA I hope to have a tidy sum there to augment my RRSP and cash accounts.
Looking back over the last 26 months, I have monthly gains in 21 of those months, I was down in 4 of those months, and I was even for 1. Although I go trade by trade according to the moving average graphs, I do evaluate my performance on both a monthly and yearly basis.
I am still looking to refine my approach somewhat to make the returns even better and to reduce the amount of time I spend on looking at my stocks (even though I only spend 15 minutes per day now). One of the things that I started doing was putting in stop losses to protect gains even when I wasn't near the sell indicator on the graphs.
For January, I plan to ONLY sell when the graphs tell me to and to try to trust the difficulty of getting through the lines to maintain gains. There are many securities that I sold on a gain during weakness that then continued to move up and I never got back into them again. The ETF's for the indices, like HQU, HSU, and HXU are prime examples of this. I made money on them all but I was stopped out of them early and missed subsequent large gains over the coming months. I will evaluate in January how this approach works out for me and report back here.
I wish everyone a profitable 2011 and I hope you had good gains in 2010. If you have any questions or comments, please post them here and I will be happy to respond.
Going into 2011 (Canadian trading to begin on Tuesday, January 4), I am 33% invested with the rest in cash. I currently own ARE, BIN, HSE, OCX, S, SC, TRP, and YLO. For Tuesday, I am looking at more securities that are in BUY territory - HNU, BBD.b, COS.un, ECA, LIF.un, PWF, and QBR.b. I am also looking at CCO, which is already in HOLD territory and the outlook for uranium looks positive for 2011.
I will also deposit $5K into my TSFA account on Tuesday, to get the money in there as soon as I can. It will be the third year that we are eligible to contribute to the TFSA and the third year that I have done so. My original $10K is up to $12,760 so I have over a 25% return so far (I am am sure there are many people with better TFSA returns, but I am happy with this). I know I won't be able to keep this up every year but after 20 years of putting money into the TFSA I hope to have a tidy sum there to augment my RRSP and cash accounts.
Looking back over the last 26 months, I have monthly gains in 21 of those months, I was down in 4 of those months, and I was even for 1. Although I go trade by trade according to the moving average graphs, I do evaluate my performance on both a monthly and yearly basis.
I am still looking to refine my approach somewhat to make the returns even better and to reduce the amount of time I spend on looking at my stocks (even though I only spend 15 minutes per day now). One of the things that I started doing was putting in stop losses to protect gains even when I wasn't near the sell indicator on the graphs.
For January, I plan to ONLY sell when the graphs tell me to and to try to trust the difficulty of getting through the lines to maintain gains. There are many securities that I sold on a gain during weakness that then continued to move up and I never got back into them again. The ETF's for the indices, like HQU, HSU, and HXU are prime examples of this. I made money on them all but I was stopped out of them early and missed subsequent large gains over the coming months. I will evaluate in January how this approach works out for me and report back here.
I wish everyone a profitable 2011 and I hope you had good gains in 2010. If you have any questions or comments, please post them here and I will be happy to respond.
Subscribe to:
Posts (Atom)
