Super Stock Picker Forum

April 23,2009

The VIX has retreated from a historic high of over 80 and is a definite downward trend (now less than 40 again). This indicator reflects market sentiment. The higher the number the more volitile and worried traders are. Its downward momentum coupled with the recent upturn in the market seems to indicate that there could be gains in going long.
I own several energy and mining stocks among the odd high tech stock and am optimistic. Anyone else feel lucky?
Bryan

The TSX and the DOW seem to be pulling back from their massive losses (bottoming in March). If TA rules hold up, their are 2 options;
1) They retrace 50% upwards before starting another downward leg. That would put the TSX at 11,250 and the DOW at 9750.
2) They continue upward beyond these levels to make new highs.

Given the "bubble" created by the housing boom it would seem logical that #1 is more likely.

Bryan 

The timing indicator should change to "buy" today,anybody getting back in? SCARY MARKET! Don Vialoux (financial post ,BNN.CA,etc.) says stay out til November! Don't get back in in Sept. whatever you do-historically worst period for TSX is Aug.-Oct.(have people forgotten last year already!

The TSX is forming the right shoulder of a head and shoulders pattern. This is a VERY bearish signal.

I am out.

Hi Bryan,

The SSP MTI is still UP at this moment I write this.
But I also think that the rally in the bear market is over, globally.
Still I think that this will help some stocks.

Not everyone will go at cash: they will turn to other stocks.
Look at Jean Coutu in the past days but mostly today.

But why don't you buy a bearish S&P TSX ETF :
http://www.google.com/finance?q=TSE:HXD (http://www.google.com/finance?q=TSE:HXD)
A perfect reverse mirror of the TSX, and surprisingly still pretty cheap.
If the signal is VERY bearish, this ETF could grow almost 100%.
I guess this should be part of everyone's portfolio now.

Louise

Hi again Bryan,
Considering your alert, after I replied to you and talked about HXD,  I bought it too: today the TSX went down 1.24%... and HXD jumped 2.65%.
I had put my order in the night, and when the market opened it had already gone up higher then my limit price: (gees some people are fast!).

I think I remember, but I'm not sure, that you said once that you had been trading that ETF.
Did you need to day trade it?

I did not stick to the principle "Do not run after your stock", and I changed my order. Still I had a gain of  1.74%.
I guess (if the TSX gains a little bit back), I could double my position, trying to catch HXD somewhat lower. What do you think?
Although I don't need too many: each time the TSX goes down, my big dividend paying Income Trusts go higher.
I also have my shorts, but as you well know, you can't short in an RSSP.

Thanks in advance for your advice (or anyone else's, but it looks like there are not too mnay people participating to this topic) about that ETF, I am not used to that playground  ;)

Louise

Hi Louise
In my opinion the markets look like they have topped and are transitioning down. Its a tough time to trade. I think your right to take small profits as during trend chages its not uncommon to see "frothing" where the markets shift wildly. I may wait for a few days to get into some reverse ETF's like HXD. There are a few others that look good too;
HOD, HND, HED and HSD.
Finally we can "short" the market in our RSP's!

Hi Bryan,
As for taking small profits, we think the same, although it is somewhat frustrating, and the reverse is also true: I have taken small losses, just to see the next day that I could have had ... a small profit
And I  guess you were right too that it was too early to buy HXD. Luckily, I had bought only a 1/3 of the position I would have liked to take.

Thanks for the other ETF ideas, I had a short look at them: apart from.HSD, they are mostly bearish on energy, which seems to be a good ides. I had based my choice on HXD based on the DOWN MTI signal.

But my question was more precisely: how did you trade them. My feeling is that people buy them and put them right away for sale: when you said (pretty long ago) that you had been "trading" them, was it a kind of day trading, or did you keep them for a while?

Hi BullBrian !
Bonjour BearLou !


I'm a new member,
Read a lot of the post on this forum .....quite interesting!
I'm also praticly all out.(just kept a few penny stock to gamble with).
I agree with you guy's ,I feel that the markets are in wait & see mode (digestion of the last 3 -4months).There's no problem to step a side once in a while to review our positions.The present economy have some cathing up to do with the stock market.
I feel that it will go side way maybe down a little not to mutch.
Unemployement want to stabilyse down south.
I'm  5 years away from retirement ( i hope) so i have to play it safe.
When times are good i also feel that a portfolio should include stock like HXD wich is a good gamble.
Louise,could you recommend me a good income Trust ?
These are 2  long term stock on my watch list :
NYSE : XIN (Chinese real estate)why not ?
Nasdaq OTC : CHKDG (Natural gaz=clean energy)
Anybody's comments on these stocks are more then welcome.
No way shape or form i want to promote these stock!

Just received my first price daily buy and sell advice,
Sorry for my ortograph English is my second language.

Robert   :)

Bonjour Robert!

Et bienvenue sur ce sympathique forum!

Since you posted in an English topic, I'll reply in English too.

(Hey BearBrian, do you understand French?)

First I'll say that I am happy that someone else joins this topic: there were no too many of us here.

We are going to be a little out of topic, but not too many people care about that, (I am usually the one who does care) certainly not Bryan.

I hate to "recommend" stocks, I'll just tell you what I hold or check now.
I won't talk about the ETFs, since you've probably read our discussion on them, and Bryan has more experience then me on that subject.

Income Funds built on trustworthy firms are better then Income Funds that are simply created by groups of rich people who gather capital and start buying different things.
I lost a lot with Yellow Pages (YLO.UN), although the "damn" analysts kept rating it pretty good.
The yield was good but not enough to compensate the fall of the stock.

As I mentioned earlier I think in this topic, I hold to BPT.UN, linked to Boralex. you'll find out the yield yourself, but apart the high dividend, I also had a pretty good capital gain. One of the rare times where I accumulated by adding to my position when the price went down because the yield went up at the same time.
When I though it was starting to go south, I sold 1/2 of my position, and now it seems to have changed direction again.

When I sold 1/2 of my BPT.UN, I used the money to double my position on AW.UN, which gives a still higher dividend.
The problem with this one is the volume, or the absence of it:
The difference between ask and bid is always big, and you can have surprises: the stock will stay for hours at 13.84 and suddenly, finish at 13.90... or the reverse  >:(
But when the market goes south, the sellers are very "stubborn", so I guess it would be easier to buy it on a day (if ever there is one) when the TSX makes a big jump up. Since AW.UN is "fed" by A & W, there is little chance that it will crash down the way YLO.UN did.

You are talking about 2 "long term stocks"... I think there are not many of them (I don't know what you mean by long term), for me, (apart for the income trusts and the fixed revenues) "long term" has become one week, two max.
From what I have read, lots of people seem to agree with me, for different reasons, (one of them being the easy and cheap online trading), there are very few "investors", and many more "traders", which I have become since the beginning of the crash.
Terribly addictive!.
But there is one I keep my eyes on for a potential long term: TD Bank..

Since you seem to invest also in USD, I have recently made a huge gain on a (Chinese too):stock:
VANCEINFO TECHNOLOGIES INC, NYSE: VIT.
But it raised more the 150% since April, so now, there is a lot of profit talking. (I did not get the 150%, I discovered it like often, by mere luck, but I was able to catch the last 20% in about 15 days, and cashed my profit the first day it went down.

I keep a constant eye on it, they used July 3rd when the markets were closed, to announce 2 new acquisitions, and the markets do not always react well right away to acquisitions. But lots of cash, and zero debt.
The "After Hours" trades on Thursday were 1.12% up, and I think it is still cheap.
I don't know if the 52 weeks High (15.50) will constitute a resistance: I doubt it, but I won't buy it again until it shows that the correction is over.

As for the 2 stocks you were mentioning: Xinyuan did pretty well but now it seems too quiet for my taste, close to a strong support, but with a few hard resistances not too far up. On an intermediate term, it could take 1 or 2$  but before that, it could also loose the same. The real estate crisis is not limited to the US!

As for the Nasdaq OTC:CHKDG, I wonder if you made a typo, I could not find it anywhere.

But although I also keep an OTC Penny stock, I usually do not like OTC stocks, and would certainly not recommend the one I own!
For a while I had a huge profit, but I became greedy and now I am only in loss.
So hard to sell! I kept trying, and I finally sold to market, what increased my loss.
I keep the balance as a tiny proportion of my US portfolio, and this is for the LONG LONG term,  where I am prepared to loose every "penny" I have put in it.As you said, it's for the fun of gambling, but I would not keep 2 or 3 of them!

You are right to try to play safe with the capital saved for your retirement,
I do the same: my RRSP is extremely conservative, and I "play" only with my margin US account that allows my to short both US and CND stocks.

Do you also short sometimes? I really wish SSP will build a short portfolio: they were too busy with their MTI, and other things too I guess.
Stocks to short were easier to find last July-August! Since I am the "BearLou", this is really for me the fun part, but now there are so many undervalued stocks, it's harder to find.
One day I guess I'll write a long post on my "shorting tricks", because my "good hits" percentage is much higher with shorts then longs, even in bull markets

Finally, PLEASE, do not think I am "recommending" any buys.
I leave that to SSP, they are usually pretty good.
I just told you what I am looking to these times.
Like everyone, I sometimes make good hits, and other times, I goof miserably.
But if I am right 6 times out of 10, I consider I'm not too bad, as long as I can limit the losses on the 4 bad decisions.

Sorry for that long post: my posts are rarely short, but I also do a lot of research before and while I write them.

Louise (BearLou)

I will buy and hold for at least a few days till the predicted trend is proven or not. If the trend prediction is proven I may hold for weeks or months till a reversal indicator shows up.

Hi

I think we have to be very carefull about the etf.

Too many people are making sucker bets with these products

Warning: Leveraged and Inverse ETFs Kill Portfolios

Here is a good article about such ETFs:

http://news.morningstar.com/articlenet/article.aspx?id=271892http://

I hope someone took my advice and bought reverse ETF's on Friday. I wish I had!
Bryan

Hey BullBryan?
Don't they say: "Put your money where your mouth is?"

Yes I had listened to your recommendations, I had kept my HXD position, and added this morning one of yours:HOD.
Unfortunately, it was too late for today! We already new about the big drop of Oil, and because I was in a hurry, I got it too late: the drop was priced in.
So don't be sorry. I moved really too quickly: this is the type of thing to buy when the Oil is UP, and not already down.

But if its like my HXD, you said is was too early!  Maybe a few days too early, but I got a pretty nice ride today!!!
Might be the same with HOD.
But I'm starting to think that one must buy and put for sale right away. It not even a matter of day trading, I feel it's a matter of a few hours trading.

I've done that a few weeks ago (it was not an ETF, is was a regular - US - stock): I placed my order before the markets opened, went to Montreal, and a few hours later, with a nice gain of about 57$, what would have been a 500$ loss the next day. The TA looked nice though.... but the markets now, you can't turn your eyes away for more than an hour.

Louise

And ge,
Thanks for the article reference.
I only had a quick look, I did not have time to read it really thoroughly, which I will.
I am also a little bit skeptic on ETFs, they are really more betting than anything else, and I am sure that more experienced traders have a "know how" (like good poker players), that I do not have, at least not yet.

But they are so tiny proportions of my portfolio, it just adds a little adrenaline to the game... But I don't think I'll keep them very long: it's closer to horse racing bets than to portfolio building.
But that what I once said to my broker, LONG LONG ago, when I had one. I told him" OK you think I take to many risks (like shorting a gold stock while Gold was having an incredible rise), but if I did not do that, I might be betting on horses. [BTW, I did make a gain on that short, and both my broker and his daughter could not sleep all week-end): I covered on Monday with a gain of 150$, what was huge for me in that time, considering that it included 2 x $60 commissions]

Louise

Hi,

Here is a link to an article that lists Canadian ETFs:
http://www.investorsfriend.com/Canadian%20Exchange%20Traded%20Funds%20Canadian%20ETF.htm

I haven't checked if there are some bearish ones that were not named here before...

And another article about Leveraged ETFs and Microstructure Effects:
http://www.taipanpublishinggroup.com/taipan-daily-051309.html

Thanks for the links SSP,

As for the first one (list of Canadian ETFs), there is only one "1 time bear" bearish, not the most attractive one, the other ones are mostly the "ultra bearish " (2 times bear).
All links bring to pages that we (or I at least) will go directly to if I want info. And I find the comments... well so so.

As for the second link, the article is interesting and goes somewhat in the same way of thinking as the good article that ge sent, and that is really worth reading.

I think that both warn us not only but mainly against "ultra short" ETFs, which we did not discuss much here.
I too think it could be dangerous to build a full portfolio on "ultra shorts" as well as on "ultra long" ETFs, or simply ETFs.

For me anyway, ETFs are only like... a little bit of spice over a dull beefsteak.
I discovered them pretty recently, played a little bit on them to "do my teeth"(don't know if this expression is used in English), I was successful each time, but only because I watch extremely closely, they are also so versatile, and never fantastic results, maybe because im too unadventurous in my RRSP.

To tell the truth. I do not understand all the underlying concepts, and I am not sure I want to spend much time in trying to understand them.

But where else to turn these days in an RRSP??

Louise