Tuesday 22 November 2011

Equity Trading Mea Culpa, Part 11

This year for trading equities started so well - too well as I should have know. My portfolio was up 20% by February and as my hand hovered over selling to take profits, my greed got the better of me.

A painful lesson has since been learnt, greed is not good.

Unfortunately a couple my main holdings dived so quickly that selling out was not even really possible. So now at 50% down on the year, my portfolio continues to flatline and gone are the day so gleefully updating the blog! Instead, it is with a deep sigh that I try and make the best of things.

Clearly the Euro-area break-up (which I foretold, to make matters worse, not even taking my own advice, moronic as even my wife reminds me) is going to be with us for a good few months yet and may well precipitate an even bigger fall in equities.

On the other hand, constant money printing by the Bank of England also will help to temper any falls and make equities a good long-term bet. Certainly UK Gilts cannot go up in price anymore. But whilst the markets rage, there is little to do.

In amongst some disastrous holdings, CAZA, AST, which are both 80% down on the year and unlikely to revive within 12 months, there are some good bets still, particularly at these prices:

EMED - A new Spanish Government means that surely within a few months permission to start mining at Rio Tinto will be given. With the price at 7p and operating profits for year one expected to be worth that 3p per share, there is a long way to go for this one. Long time readers though will note I could have written this 3 years ago more or less...hope springs eternal.

GKP - Actually flat on the year, finding billions of barrels of precious oil every few months makes this a monster bet. Lots of complex politics in Iraq holds it back, but with Exxon moving into Kurdistan a break in the political deadlock maybe approaching - with that this is another share that could easily double from its current price.

XEL - Xcite Energy, sigh, what a rubbish year after a good start. Still though next year will see it start producing 20,000 barrels of oil a day in the North Sea and a become a solid safe company. The highs of 425p per share are a long way off. But at 118p today there is huge upside with a 6 or 12 month view.

At least everyone is losing, even Anthony Bolton.


BlackRaven said...

you have too much risk.

sorry, you *had* too much risk

Dick the Prick said...

@CU - I have found, through bitter, costly and repeated application that taking one's own advice is nigh on impossible. I have cost myself an absolute fucking fortune whereas any old soak who happened to sit next to me in a boozer, on a train, in the bloody Tesco queue would have been quids in.

As Blackadder says, 'hic jacet Edmund and he's bloody annoyed'.

Steven_L said...

Tell me about it! I got drunk the other week and closed my AUD/USD short at a loss! Grr, would be a weekend in Amsterdam up by now.

Budgie said...

For me EMED down about 40%, GKP up about 50%, XEL down 60% (I got in too late there).

I like the look of AFE and RGM as well now. I might add MAX to that pair. XTR has risen lately.

PPA has gone down the pan and I don't think much of Heritage either.

CityUnslicker said...

Budgie I still have XTR, PPA I am glad I sold ages ago at a decent profit.

New ones I am thinking about are Autona and RRL - but really new funds will go into shorts...

Steven_L said...

Shorts? I'm tempted to take you as some sort of contrarian indicator here. Was thinking about getting in long on BMW or one of the blue chip miners this morning in fact.

What'd you short that's not already crashed and burned then?

andrew said...

I remember the first time you mentioned BMW and the price then was about 47Eur.

Thought about it and did not (more fool me) Price is now about 52 having hit 61

However, look at Peugeot... either starting to look cheap or the market thinks it is due to conk out completely.

Steven_L said...

At this price it's got to be a good long term hold as part of a balanced portfolio.

Budgie said...

No eurozone shares for me, and no banks or insurers either.

Dick the Prick said...

@Budgie - me too, putting all my money in drugs and porn. Although those Czechs....

Anonymous said...

Belgian bonds broke resistance at 5% yield and now rocketing upwards. France also rocketing upwards on Dexia news.

Even Germany yields spiking up as UK yields fall - bond traders getting out of EZ completely and heading for UK. The EZ party will soon be over and even the Germans are going to find egg on their faces.