Personal Finance
It isn’t often a fabulous weekend away can be profitable. But that’s exactly the combination we offer you at Michael Campbell’s World Outlook Financial Conference in Vancouver on Jan 31st and Feb 1st.
Our 25th annual event is once again being held at the spectacular Westin Bayshore Hotel overlooking Coal Harbour, Stanley Park, the wonderful Seawall and a view of the North Shore mountains.
If you’re thinking about a mid-winter break we invite you to consider our special group rate accomodation package that includes the Westin’s Heavenly Beds and view rooms, complimentary Health Club and WiFi access plus spa discounts.
But this special offer expires on Friday January 17th – so order today. For more information and to book CLICK HERE.
See the next generation of huge-growth investment opportunities
The World Outlook Financial Conference features top analysts from the English speaking world giving their forecasts for gold, the US and Canadian dollars, the stock markets, real estate, interest rates and the bond market.
They are chosen for two straightforward reasons: their integrity and their track record. The World Outlook Financial Conference Small Cap Portfolio was up 86% in 2012. It is up 32% year-to-date in 2013. Can you afford to miss hearing the picks for 2014? Last year you would have also heard:
* Real estate recommendations that returned more than 30% annually.
* Warning on oil & gas markets that saved investors from 20% losses.
* Currency recommendations that returned 30% in 3 months
* And many more…
Bring a student for FREE
As you may know Michael Campbell is hugely interested in educating our younger generation and to that end we have a special offer – if you buy a ticket – you can bring a student absolutely free.
The only thing is that we ask you to let us know in the Order Notes that you want a student ticket when you purchase your ticket because we have a limited number of tickets set aside. Students have really enjoyed the conference ait is also a great way to share/create a common interest with your children – no matter what their age.
Conference Details
Where: Westin Bayshore Conference Centre, Downtown Vancouver
When: Friday afternoon and evening, January, 31 and all day Saturday, February 1, 2014
To book Your Ticket: CLICK HERE or call toll free 1.877.926.6849
Cost: $119 for a two day pass
Back during my schooling years, I studied the same problem again and again so that I didn’t make the same mistake come exam time.
Problem was, I was horrible at application.
If the exact question came out in the exam, I killed it.
But that rarely happened. The question was always worded differently and confused the heck out of me.
I ended up screwing up similar questions multiple times.
The market is like this.
You make investment mistakes and in order to make sure you get it right next time, you focus and tell yourself you won’t make that mistake again.
But then a slightly different stock comes along and before you know it, your tendencies start to come out….. again.
This happened again in 2013 and since I know I am not perfect, I want to share some short reflections on the common investing mistakes that I have made.
It’s time to confess.
Common Investing Mistakes that I have Made
1. Trying to Time the Market
Everyone is affected by what the market does to a certain degree.
The biggest problem is that with the market zooming up, uncertainty about when to buy creeps in.
Should I buy now?
Or should I wait a little to see if the market corrects itself and get a better price?
The fix?
Focus on the investment quality of the business and to buy it at a cheap or fair price independent of what the market does.
2. Focusing on the Stock Price and Not Intrinsic Value
There are two parts to common investment mistake.
If the intrinsic value of a stock is 50% or even 100% higher, then waiting for the stock to drop a measly 2% before buying doesn’t make sense.
I have found myself quibbling over wanting to buy it “just a little cheaper”.
How many times have you found yourself submitting a buy order and entering the bid price just a few cents lower than the stock price?
Stop quibbling over cents.
The second point is that the stock price does not dictate intrinsic value. If the stock drops 20%, it’s easy to get worried, but the best thing to do is nothing.
I’ve made the mistake of making an emotional decision.
The stock price is not an indicator of intrinsic value.
3. Holding a Loser Until it Breaks Even
I fall for this one more often than I should.
A dreaded bias of not wanting to close the position on a stock at a loss that I invested a lot of time and effort on.
GRVY was a net net and had the makings of a huge profitable investment.
Like all things in life, it didn’t turn out the way I had planned.
With my investment down 50%, I did hope that I would break even. But over the past year, I have scaled back the holding.
I still hold a small portion because at the current price, it would also be an emotional move to sell out completely.
The value of the cash on hand far exceeds the stock price and as much as I want to sell and be done with it, I know that even crap stocks make good investments at dirt cheap prices.
4. Overly Focusing on Other People’s Opinion
There are pros and cons to this.
The pros are:
- it’s a shortcut to investing especially when you’ve found somebody you can trust
- saves time
- build a diversified (> 20 positions) based on other solid value investor picks and it beats the market
The cons are:
- you don’t know what you are getting yourself into
- you don’t know exactly when to sell
- you don’t know what to do if something bad happens and you need to keep asking for opinions
It’s truly a big mistake when you end up completely relying on another person on the investment.
I bring up GRVY again. Yes I screwed up on that one, and I know people also bought into it as well. The mistake is that I can’t provide live updates for every move GRVY makes.
Becoming overly dependent on someone else is a mistake which is a huge portfolio risk.
5. Not Utilizing My Checklist Enough
I do have a checklist that I refer to. I purposefully didn’t make it into some gigantic list or to be very exhaustive.
But by using just one set of checklist, I end up looking for the same style of companies. My checklist needs to expand and evolve into something that can handle different types of investments.
A collection of shorter checklists is needed that is suited for different situations such as:
- common value plays
- turnarounds
- high growth stocks
- and net nets
Not only will this help make better decisions, but it will also reduce time during the research phase.
You need to have clear goals of what you want to know instead of wandering and figuring out what you should do be looking for.
Bonus Mistake: Handling Too Many Accounts
This is more of a problem than a mistake, but I would love to hear your opinion on it.
It’s a personal one and it doesn’t look like it won’t be going away anytime soon.
I’m currently managing 3 accounts for my investing.
- 410k to trade stocks
- A personal brokerage account
- A new investment account for OSV
Problem is that I can’t combine any of them and the difficult part is having to log onto all three accounts to make transactions.
Since all three accounts have different balances, it becomes a chore and time waster trying to manage, track and maintain 3 different accounts.
If this sounds familiar to you and you have a method of making it easy, please leave me a comment and let me know.
Going Forward?
Am I the only one to make these 5 mistakes?
Are these the only ones that I’ve made?
No to both.
But looking back throughout the years, I have been making progress in reducing mistakes and there will be many more mistakes to learn from and keep in check.
So think back to some common investing mistakes you’ve made. Now it’s your turn.
What mistakes have you made and what are you going to do about it?
Visit 
Up to 16.63% a Year From an Energy Play Obama Hates
The dust from it causes a deadly lung disease… anthracosilicosis. It’s dirty, smelly and dangerous to mine, and anyone who has ever heated their home with it – and I am one of them – hates it.
The media thinks it’s dead and the White House wishes it would disappear, but it isn’t going anywhere. In fact, the world can’t function without it… coal.
The world needs coal. Even the United States, despite the president’s best efforts, has to have it to generate electricity. Last year, 37% of our electric power came from coal. And while more power plants are shifting to natural gas, coal will still be one of our primary sources of electric power for a long, long time.
In the emerging markets, especially China, coal is the fuel for power generation and industry.
It isn’t going anywhere.
A Contrarian Play
….read all about this high return bond play HERE
DOW -179 on 1450 net declines
NASDAQ COMP – 61 on 1050 net declines
SHORT TERM TREND Bullish
INTERMEDIATE TERM TREND Bearish (change)
Available Mon- Friday after 6:00 P.M. Eastern, 3:00 Pacific.
STOCKS: We’re bearish on the stock market for 2014. This was the title of our January newsletter, sent out on January 6th.
But, we thought we could get a bit more on the upside, mainly based on the fact that the advance decline line was outperforming the major averages and also on the favorable seasonality.
So it was a big surprise to see the extreme weakness on Monday. Several things probably contributed. Goldman Sachs said that valuations were elevated. Dennis Lockhart the president of the Atlanta Fed suggested that tapering would continue and there have been a number of earnings warnings.
GOLD: Gold was up $6.
CHART: The S&P 500 made a low below a previous low today (arrows). That tends to be a negative. However, the VIX, or fear index changed by 9%. When it changes by this much, we usually get a short term bounce. Let’s see what happens tomorrow.
TORONTO EXCHANGE: Toronto was down 60.
S&P\TSX Venture Comp: The Venture Comp was down 2.
BONDS: Bonds moved higher again.
THE REST: The dollar was lower. Silver rallied. Copper and crude oil were lower.
BOTTOM LINE:
Our intermediate term systems are on a buy signal.
System 7 We bought the SSO at 101.79. If there are more declining issues than advancing ones at 3:45 EST, sell at the close.
System 8 We are in cash. Stay there on Tuesday.
NEWS AND FUNDAMENTALS:
There were no important economic releases Monday. On Tuesday we get retail sale. That should be interesting.
…………..
We’re on a buy for bonds as of January 10.
We’re on a buy on the dollar and a sell for the euro as of December 19.
We’re on a sell for gold as of December 19.
We’re on a buy for silver as of December 10.
We’re on a sell signal for crude oil as of January 2.
We’re on a sell for copper as of January 9.
We’re on a buy for the Toronto Stock Exchange as of today December 26.
We’re on a buy for the S&P\TSX Venture Comp. as of December 31.
|
We are long term bullish for all major world markets, including those of the U.S., Britain, Canada, Germany, France and Japan. |
INDICATOR PARAMETERS
Monetary conditions (+2 means the Fed is actively dropping rates; +1 means a bias toward easing. 0 means neutral, -1 means a bias toward tightening, -2 means actively raising rates). RSI (30 or below is oversold, 80 or above is overbought). McClellan Oscillator ( minus 100 is oversold. Plus 100 is overbought). Composite Gauge (5 or below is negative, 13 or above is positive). Composite Gauge five day m.a. (8.0 or below is overbought. 13.0 or above is oversold). CBOE Put Call Ratio ( Below .80 is a negative. Above 1.00 is a positive). Volatility Index, VIX (low teens bearish, high twenties bullish), VIX % single day change. + 5 or greater bullish. -5 or less, bearish. VIX % change 5 day m.a. +3.0 or above bullish, -3.0 or below, bearish. Advances minus declines three day m.a.( +500 is bearish. – 500 is bullish). Supply Demand 5 day m.a. (.45 or below is a positive. .80 or above is a negative).
No guarantees are made. Traders can and do lose money. The publisher may take positions in recommended securities.
|
This email was sent by toddmarketforecast@charter.net |
Subscribe or Update Profile/Email Address
|
In this week’s issue:
Stockscores Market Minutes Video
The fast money is made by trading hot stocks but finding them too late can mean that the reward for risk of the trade is poor. This week’s Market Minutes video discusses this idea in addition to the weekly chart analysis. View the video by clicking here.
Chasing Hot Stocks
Traders love hot stocks, those names that are making big gains on strong volume and attracting a crowd of speculators which continue to drive it higher. A trader who listens to the story but ignores the chart can buy in to these stocks too late, paying a price that has more downside risk than upside potential.
Even if you are not an expert at reading stock charts, taking the time to check the chart before you buy a stock is a must. When looking at the chart, you should evaluate how far the stock has moved from its most recent area of support. The farther a stock moves from its floor, the closer it gets to its ceiling.
To see where the relevant price floor is, look at the chart and determine the last time the stock traded sideways before it started to show strength. Draw a line across the bottom of that sideways trading range.
Now, look at where the stock is now. How long has it been going up? How far up has it moved relative to the normal trading volatility of the stock?
I don’t like to chase stocks that have moved far up from their price floor because the downside risk is too much for the upside potential. If a stock is destined to move from $10 to $15 but there is a risk it could go down to $9, you don’t want to buy it at $14. It makes sense to pay $10.50 because your downside is $1.50 while the upside is $4.50.
I have shown this concept visually in this week’s Market Minutes video, you can watch it on Youtube by clicking here.
Keeping this concept in mind, it may be ok to pay a higher price for a stock if it has just recently moved up from a period of sideways price movement. That sideways price movement is a foundation for a trend, it gives you a well-defined floor for risk management.
When playing hot stocks, buy them when they are just starting to behave abnormally, getting in as close to their price floor as possible. The higher the stock goes, the riskier it gets.
Two things have been happening to start 2014. We are seeing profit taking in the strong stocks. This makes good sense, an investor with a large capital gain going in to the end of 2013 has incentive to avoid selling it until 2014 so that the tax payment can be delayed. I think this is the major reason why the overall market is pulling back this week.
We are also seeing money come in to Mining stocks, I believe for the opposite reason. These stocks were heavily oversold going in to the end of 2013 because people were locking in their tax loss. If you have gains in other stocks, you can lower your tax bill by selling your dogs.
Now that we are in 2014, there has been some buying of the Mining stocks and Gold has bounced higher. This raises the question, should we be buying the Gold mining stocks?
My general answer to this question is no, at least not with any enthusiasm yet. The charts for the Mining stocks are still in downward trends, the strength so far this year is a comeback from oversold conditions rather than a sign of strength.
However, the gains made thus far are an encouraging first step. For that reason, I think it is appropriate to own one Gold miner if you are comfortable with being patient with it. A turnaround may be underway but it is very early which makes it less likely that the turn will actually come. If the Miners are bottoming here, you can add more as the chart improves.
With that in mind, I set out to do a Market Scan for Gold mining stocks on the Canadian exchange. I ran the Stockscores Simple Market Scan with a minimum number of trades of 250. The scan found 17 stocks of which a few were Gold miners. Here are two that I think have good long term turnaround charts.
1. T.LSG
T.LSG has been building rising bottoms, a sign of optimism, for a few months and is now moving through resistance that has held up since last Spring. The stock has been strong for a few weeks so it may pull back in the short term before resuming its upward trend.
2. T.SMF
T.SMF broke its long term downward trend in the late summer and is moving to new 52 week highs. The stock tends to be a leader when the Gold stocks are performing well.
References
- Get the Stockscore on any of over 20,000 North American stocks.
- Background on the theories used by Stockscores.
- Strategies that can help you find new opportunities.
- Scan the market using extensive filter criteria.
- Build a portfolio of stocks and view a slide show of their charts.
See which sectors are leading the market, and their components.
Disclaimer
This is not an investment advisory, and should not be used to make investment decisions. Information in Stockscores Perspectives is often opinionated and should be considered for information purposes only. No stock exchange anywhere has approved or disapproved of the information contained herein. There is no express or implied solicitation to buy or sell securities. The writers and editors of Perspectives may have positions in the stocks discussed above and may trade in the stocks mentioned. Don’t consider buying or selling any stock without conducting your own due diligence.
-
I know Mike is a very solid investor and respect his opinions very much. So if he says pay attention to this or that - I will.
~ Dale G.
-
I've started managing my own investments so view Michael's site as a one-stop shop from which to get information and perspectives.
~ Dave E.
-
Michael offers easy reading, honest, common sense information that anyone can use in a practical manner.
~ der_al.
-
A sane voice in a scrambled investment world.
~ Ed R.
Inside Edge Pro Contributors
Greg Weldon
Josef Schachter
Tyler Bollhorn
Ryan Irvine
Paul Beattie
Martin Straith
Patrick Ceresna
Mark Leibovit
James Thorne
Victor Adair