Ryan's Trading Journal (F/A+T/A Strategy)

[ducati916]

What is an example of a long term hold strategy and "working the positions"?

Are you talking about buying the dips on fundamentally strong companies?

It can be a company [stronger the better], or an ETF [which I prefer] or a commodity which I also prefer [silver/gold] where you take an initial position by selling a Put option.

Once filled [exercised] you sell a call, but you don't allow the position to be exercised unless you are selling part of the position to take profits.

Then, once you have sold part of the position through being exercised, you can sell another higher call and also, sell a put to buy a dip. Over time, your position grows and you take increasing premium.

This is a buy and hold position, you just use options to trade the position. You trade the position based on the technicals. The fundamentals dictate that you can hold indefinitely.

Over time you want the market to move both higher and lower. This works well with high dividend and rangebound stuff.

If you catch a real flyer that does nothing but go up, well at some point you close it out and start again.

jog on
duc

 

[Rypieee]

EOW 03
Portfolio performance up to date (Starting 1st of March 2017) = 3.97%
Market performance (ASX200) up to date from 1st March 2017 = 0.82%

This week we sold off SSM @ $1.34 after purchasing it from it's breakout at $1.25.
I regret the sell and there wasn't even a reason to sell the stock. I was afraid of the supply block at $1.40-45 by Thorney Opportunities Ltd who seems to be the one selling once SSM gets to those levels. I did not even execute the sell properly and just sold it randomly at $1.34 rather than $1.40 or higher and allowed myself to be influenced from external parties. I got into the trade on a good entry price but i exit the trade on a terrible price and my reward on the trade has suffered.

I will look to re-enter SSM in the coming week/s.

Asides from SSM, all the other positions within the portfolio are gunning away! ALL released their interim report this week and the market liked it, brokers have all raised their targets to $23-26 which fuels more momentum for the stock. FPH also released their interim report last week but on the day itself, the market seems to be half half about it on the day itself but towards the end of the week on the last trading day, we saw a heap of demand coming in for FPH and the SP ended much higher. I would expect FPH to have some trouble against the previous high resistance at $10.20 but since the move to push against the resistance level was done on a gap up, I am not as worried.

IRI seems to be going into a continuation phase and a Ascending Triangle pattern is developing, I shall be careful of the price action of IRI in the coming week.

Overall, pretty happy with the performance of the portfolio, except for my mistake of selling SSM for no apparent reason (I am still clueless at myself as to why I sold it in the first place... )



Since the sale of SSM, we have about 28% in the cash account ready to take up some opportunities as they come out. Not too long ago, I was in a situation whereby there was so many opportunities to take but I didn't have the resources. Now I have the cash ready but no opportunities within my pool of stock. Rather than to venture outside of my pool of stock (which I have done in the past and didnt end well), I will be patience for the opportunity to present itself.

 

[Gringotts Bank]

Ripieee, how many ASX stocks do Lincoln rate as being in the 'strong' or 'satisfactory' categories, as a general guide. Thanks.

 

[Rypieee]

Ripieee, how many ASX stocks do Lincoln rate as being in the 'strong' or 'satisfactory' categories, as a general guide. Thanks.

450+ from memory, I think they have a pie chart that shows 30-40% of the market is within those categories. The financial health rating is an aggregated score based on a companies' balance sheet, Profit & Loss and Cash Flow Statement.

 

[Rypieee]

Once again, hello to all who are following!!

EOW 04
Portfolio performance up to date (Starting 1st of March 2017) = 5.11%
Market performance (ASX200) up to date from 1st March 2017 = 1.46%

This week sells: SDF
This week buys: COH, APX, BBOZ

We sold off SDF this week after buying in 4 weeks ago, the SP of the stock has been trading sideways since entering the trade and I have decided to close the trade off and reduce our exposure to the financial sector to nil. SDF was brought in at $2.749 and sold out at $2.70 with a minor loss.

This week we also opened up a few trades, I have been watching APX for awhile since it's earnings upgrade to find an entry point. Since the gap up to the $3.60 levels, we have seen a minor/healthy pullback before more demand came in for the stock, suggesting to me that this gap will not be filled. We are maxing out our exposure to the IT sector with the inclusion of APX now. I have also opened up another position with COH after it broke out of it's previous high at $142, had a pull back and made new all time highs. This COH trade means we are maxed out on our limits within the healthcare space as well as we have 3 H/C stocks in the portfolio now.



I have taken a contrarian view on the banks and to a smaller extend, the overall market now due to an "impending" property market correction, apartment oversupply that is due to come onto the market in major cities, China's credit risk and their current debt levels which could have an adverse impact on the Australian economy should **** hit the fans. BBOZ is a bear ETF which is leveraged by x2 and tracks the ASX200 inversely. As the banks make up majority of the ASX200 index, this is my method of hedging/shorting the banks and the overall market. We have placed a stop loss on BBOZ in case my perceptions do not come to light. As it stands right now, our portfolio is still 85% Long, 7.5% short and 7.5% in cash. If the ASX continues downwards, we may look into scaling into the BBOZ trade.

Have a great weekend all!
Ryan

 

[skc]

Once again, hello to all who are following!!

EOW 04
Portfolio performance up to date (Starting 1st of March 2017) = 5.11%
Market performance (ASX200) up to date from 1st March 2017 = 1.46%

This week sells: SDF
This week buys: COH, APX, BBOZ

We sold off SDF this week after buying in 4 weeks ago, the SP of the stock has been trading sideways since entering the trade and I have decided to close the trade off and reduce our exposure to the financial sector to nil. SDF was brought in at $2.749 and sold out at $2.70 with a minor loss.

This week we also opened up a few trades, I have been watching APX for awhile since it's earnings upgrade to find an entry point. Since the gap up to the $3.60 levels, we have seen a minor/healthy pullback before more demand came in for the stock, suggesting to me that this gap will not be filled. We are maxing out our exposure to the IT sector with the inclusion of APX now. I have also opened up another position with COH after it broke out of it's previous high at $142, had a pull back and made new all time highs. This COH trade means we are maxed out on our limits within the healthcare space as well as we have 3 H/C stocks in the portfolio now.

View attachment 71396

I have taken a contrarian view on the banks and to a smaller extend, the overall market now due to an "impending" property market correction, apartment oversupply that is due to come onto the market in major cities, China's credit risk and their current debt levels which could have an adverse impact on the Australian economy should **** hit the fans. BBOZ is a bear ETF which is leveraged by x2 and tracks the ASX200 inversely. As the banks make up majority of the ASX200 index, this is my method of hedging/shorting the banks and the overall market. We have placed a stop loss on BBOZ in case my perceptions do not come to light. As it stands right now, our portfolio is still 85% Long, 7.5% short and 7.5% in cash. If the ASX continues downwards, we may look into scaling into the BBOZ trade.

Have a great weekend all!
Ryan

Ryan... just a suggestion. Your BBOZ trade appears to be a different kettle of fish compared to the rest of your positions. I am not saying the position is or isn't without merit, but I think it should be excluded from your calculation of portfolio performance - and ideally excluded from your capital used.

Because ultimately you are recording your trades to measure how well your strategy (as detailed on your first post) is going. By all means start another record showing how well you interpret, time and execute your macro contrarian views, but keep it separate.

 

[Rypieee]

Ryan... just a suggestion. Your BBOZ trade appears to be a different kettle of fish compared to the rest of your positions. I am not saying the position is or isn't without merit, but I think it should be excluded from your calculation of portfolio performance - and ideally excluded from your capital used.

Because ultimately you are recording your trades to measure how well your strategy (as detailed on your first post) is going. By all means start another record showing how well you interpret, time and execute your macro contrarian views, but keep it separate.

Hey SKC,

Thanks for the tip on not including BBOZ in my portfolio and run it as something separate so I am able to measure the performance of the strategy properly. From my POV, BBOZ is a macro play on the ASX and I still apply T/A to the trade and have it categorized as a "Trend Reversal". As I only run one portfolio and not multiple portfolios across different time-frames or asset classes, I didn't think to exclude it from the portfolio.

If i did take out the capital used to purchase BBOZ for calculation of my performance, how would I go about doing it?

Do I remove the amount of capital used to purchase BBOZ from my capital on the date of purchase?

As I calculate my performance based on my starting capital as of the 1st of March vs current capital, do I reduce the 1st of March capital by the amount used to fund the BBOZ purchase?

I do agree with you on not including it in the portfolio so I can better judge the strategy but unsure on how to proceed with it.

 

[aus_trader]

Thank you Rypieee for liking my new post "Medium/Longer Term Stock Portfolio", it got posted today with just two stocks to begin with... I have been watching your portfolio in this forum all along and quite impressed by your performance. You can be sure that I will continue to keep and eye out for you and wish you all the best with your strategy as it develops...

 

[skc]

Thanks for the tip on not including BBOZ in my portfolio and run it as something separate so I am able to measure the performance of the strategy properly. From my POV, BBOZ is a macro play on the ASX and I still apply T/A to the trade and have it categorized as a "Trend Reversal". As I only run one portfolio and not multiple portfolios across different time-frames or asset classes, I didn't think to exclude it from the portfolio.

If BBOZ trade is part of your strategy and you believe it makes sense to measure it alongside your other long positions, don't let me tell you otherwise. There is no absolute right or wrong answer, just depends on what you are trying to measure/record/evaluate with the record. It's your money so you can do what you want.

If i did take out the capital used to purchase BBOZ for calculation of my performance, how would I go about doing it?

Do I remove the amount of capital used to purchase BBOZ from my capital on the date of purchase?

What I meant was, taking up a position in BBOZ would use up capital and change how many positions you can take (or their sizes) in your longs otherwise. So the suggestion was to eliminate that indirect impact if possible. But if you don't have the capital to compensate then there isn't much you can (or need) to do about it.

 

[Rypieee]

If BBOZ trade is part of your strategy and you believe it makes sense to measure it alongside your other long positions, don't let me tell you otherwise. There is no absolute right or wrong answer, just depends on what you are trying to measure/record/evaluate with the record. It's your money so you can do what you want.



What I meant was, taking up a position in BBOZ would use up capital and change how many positions you can take (or their sizes) in your longs otherwise. So the suggestion was to eliminate that indirect impact if possible. But if you don't have the capital to compensate then there isn't much you can (or need) to do about it.

That is a fair point there SKC about the position affecting my position sizes for other long positions. The portfolio will ultimate be developed into a Long/Short portfolio so I will just include BBOZ as the short play in the portfolio for the time being It aligns with the portfolio's macro views and T/A and will be my go-to shorting strategy until i open up a CFD account that allows me to short specific stocks.

Thank you for the tip nonetheless!

 

[Quant]

I suggest you compare returns to accumulation index not just straight XJO . The gross returns for dividends is north of 6% . BBOZ is an index trade and whilst I haven't checked your portfolio stocks against index correlation probably a good idea to do so . Nice work and stick to it ..


PS BBOZ is something traded on SMSF not sure why you wouldn't include it in any portfolio , WHY wouldn't you ? Easiest way to expose super to short side imo . or any portfolio fwiw , to not include it is stupid imo

 

[aus_trader]

If I can suggest a simple modification, Add a column to your portfolio table that shows:

Code, Fin Strength,Direction, Purchase Date, Entry Price etc... If table getting lengthy call it Dir. Then in the columns below it could be an "L" for long or "S" for a short. That way if you wish to run an analysis later, you can group all the "L"s together or "S"s together and see the performances individually.

That's what I would do if I included any short positions in my"Medium/Longer Term Stock Portfolio".

 

[Rypieee]

Two opportunities have come up on my radar once again and I only have enough available cash to take one of the position. I will be looking to offload my holding in CSL after holding it for about 6 weeks with little to no performance. The chart of CSL have displayed some support at $129 but seems to lack momentum towards northeast.
Should I offload CSL today, I will have enough to take the 2 opportunities that came up last night and their growth metrics + charts looks much more promising at this stage. An exit from CSL will result in a small profit to cover the cost. If I do not offload CSL, I will incur the opportunity cost of missing out of one of the two positions and at the current moment, the benefits are leaning towards the newer opportunities!
More to come
BTW I only disclose my buys and sells at the end of the week when I have time to write up my EOW post

 

[aus_trader]

Just be careful mate with cutting and chopping here and there. If there is no fundamental change or any news developments or there is no technical reason (e.g. break below support level) you may regret getting out of positions early.

If there is a good reason such as news development that you had with NIB holdings (NHF) that you mentioned very early in this forum, then it may prove worthwhile as shown below...

 

[tech/a]

Just be careful mate with cutting and chopping here and there. If there is no fundamental change or any news developments or there is no technical reason (e.g. break below support level) you may regret getting out of positions early.

If there is a good reason such as news development that you had with NIB holdings (NHF) that you mentioned very early in this forum, then it may prove worthwhile as shown below...

Hmmm don't know about that.
If a stock is stagnant and other opportunities arise
I'd certainly cull it.

 

[Rypieee]

Just be careful mate with cutting and chopping here and there. If there is no fundamental change or any news developments or there is no technical reason (e.g. break below support level) you may regret getting out of positions early.

If there is a good reason such as news development that you had with NIB holdings (NHF) that you mentioned very early in this forum, then it may prove worthwhile as shown below...

Hmmm don't know about that.
If a stock is stagnant and other opportunities arise
I'd certainly cull it.

Mmhmm! CSL had 6 weeks to perform but seems to lack direction therefore the cull to allow room for other positions. I sold CSL today @ $131.74 from a purchase price of $127.555 for a small profit to cover brokerage and some other minor losses in the portfolio

I opened up 2 new trades today:
1) CGC - Bought in at $4.714 after allowing the price to weaken more from yesterday close (Taking advantage of an overall down day on the ASX) iSL for CGC is marked down at $4.20.

2) NST - Bought in today at $5.075 with an iSL at $4.40. Another play within my portfolio to hedge/capitalise on growing geopolitical risks in the world + other risks.

Overall, portfolio is still majority long with about 15%** on the short side (with NST and BBOZ). The banks are starting to pull back heavily, ASX went below 5700 today and further supports my trade idea on the macro level and using BBOZ as my exposure to the short side I am fully invested at this stage and MAY start looking to protect profits on my long positions should the situation deteriorate.

** Truthly the amount of the portfolio being invested on the short side is a inaccurate because BBOZ is a ETF that tracks the ASX inversely with x2 leverage so the short side is actually a little higher

Very happy with my long positions at the moment though and will give them the required room to to trend. As we see a broad base selling in the blue chips, we should expect some of that funds to come back to the small-mid caps growth stocks such as those within my portfolio.

Let me know what you guys think!

 

[Rypieee]

I suggest you compare returns to accumulation index not just straight XJO . The gross returns for dividends is north of 6% . BBOZ is an index trade and whilst I haven't checked your portfolio stocks against index correlation probably a good idea to do so . Nice work and stick to it ..


PS BBOZ is something traded on SMSF not sure why you wouldn't include it in any portfolio , WHY wouldn't you ? Easiest way to expose super to short side imo . or any portfolio fwiw , to not include it is stupid imo

Hey Quant,

Might be a silly question here but where could I find the accumulation index? What is the ticker code for the accumulation index of the ASX200?

Have thought about your suggestions and have decided to follow through on it to display a more accurate reading of my performance

 

[Quant]

Might be a silly question here but where could I find the accumulation index? What is the ticker code for the accumulation index of the ASX200?

https://au.investing.com/indices/s-p-asx-200-accumulated-chart

 

[aus_trader]

Do like your NST(Northern Star Resources) stock, which is one of the stocks that have gone up a lot compared to most other gold stocks on the ASX. It should perform well if the gold price keeps rising which it generally does when uncertainty comes into play.

 

[skyQuake]

Do like your NST(Northern Star Resources) stock, which is one of the stocks that have gone up a lot compared to most other gold stocks on the ASX. It should perform well if the gold price keeps rising which it generally does when uncertainty comes into play.

Flows related. Imo it will underperform over the next few months