Should not volume be considered

[garilou]

MKX just made it to UPMv2, as ATA received an order to sell.

You show your results just considering closing prices, but for the "real investor", something  seems inconsequent with the allocation system:
1.considering that in principle, the whole portfolio should be invested,
2.considering that MKX is the only stock in UPMv2,
the real investor following your rules would need to buy at least a few 1000s shares.

It is pretty hard to buy such quantities, with an average volume of 56500 per day.
And eventually, it will be hard to sell.

The whole day, the volume was less then average, (what could be a good sign considering the huge drop in the TSX, but I do not wish to make this question too closely associated with the terrible market conditions, but more theoretical).

With both sides, (buyers and sellers), all practically staying on their positions all day, it is pretty hard to buy, except to the market, and then you have no idea what your going to get, the buyers and sellers positions being so far apart.

So my question is as simple as that: is it enough to consider the momentum (which seemed pretty good, except maybe that the stock was somewhat oversold), and should there not be another "parameter" in you system to filter out cheap stocks that have too little daily volume?

Louise

[bryanmcn]

I agree. Volume should be considered. Of course this is a "virual portfilio" and that is what makes it impractical to follow blindly.

I seriously doubt anyone is presently using any of the portfilios for trading advise. In fact, I doubt many of us are doing a lot of trading judging by the lack of board activity.

I posted yesterday that the volitility index had been over 40 in the past 10 years only 4 times. Today it is at 48!!

Lowdy lowd!!

[garilou]

Bugmapper,

I really wonder why you post that here!
I was not asking for an advice, I was asking a theoretical question about SSP'S system in general.

Sorry, but you are really out of topic. So was Brian too yesterday.
We are in the "how it works" forum.

And SSP is not doing worst as the whole world! They just miss a "short portfolio".

Yes, cash can be a position, but I made a lot yesterday with my idea that short is also a very comfortable position.

Wish you anyway a good hunt!

Louise

PS: SSP, what's going on? You do not reply anymore? Are you too depressed to answer? Cheer up!

[bryanmcn]

Louise
Why are you so freaked out by these "out of topic" posts? I simply reply to the most recent postings as indicated at the bottom of the forum page.
Shorting is not an option for most of us trading in their RSP but does anyone know how to take advantage of downward momentum inside these accounts?
Bryan

[garilou]

Bryan,

Why are you so freaked out by these "out of topic" posts?

To tell the truth, maybe I should not. I guess it's in my temperament.
Makes previous posts easier to find, as precisely now I've been looking for one to reply to your 2nd question:

...does anyone know how to take advantage of downward momentum inside these accounts?

That person was talking about the contrarian ETFs, and negociating against the Oil price fall.
It easy to track you own posts, or someone else's, but if you do not remember the name of the person who talked about it, good luck!

The only other thing that I would see, would be the fixed income Ishares.

http://ca.ishares.com/index.do
that you can trade like a stock and that are increasingly popular.
You can add some capital gain to the dividends or other types of income you get from the one you choose..
This site is incredibly well documented.

I've been following them for some time: some days, they do almost nothing, with very little volume, other days, you have a lot of volume, volatility... well like normal shares
I thought they would be more stable in price.

I was interested, because the income could be good enough to prevent too much volatility, well this is what I thought.
But they can change quite rapidly... like the market these days: it is also not something you sit on, but at least you can buy and sell them as you want, not caught with a 5 years Bond.

I've asked about them on this Forum, and got no good information, SSP telling me he knew little about them, because they were in the normal stocks business.


But I do not think that they have contrarian ETFs.
There might be some in US $, and you said you had no problem buying US shares in you RSP.

Here is a good article:
Contrarian Markets Can Be Tamed With ETFs

So if ever you want to talk more about it, and that we can discuss your thoughts about it, maybe you could go in the proper forum (Canadian stocks or Stock market talking) and start a new topic called ETFs other Ishares 

Louise

[garilou]

Back to my initial topic!

Has anyone been able to buy a reasonable quantity of MKX?

MKX has good upward momentum, but who wants 500 shares at that price?

I tried again this morning, was not even able to buy 2000!

Louise

[DCA]

Got 10,000 MKX yesterday, but it was not easy.  Low of 1.70 high of 1.80 on that.

DCA

[DCA]

And to keep firmly on topic:

My main grumble on the SSP since I started is the lack of volume on some of the picks.  (I do recall seeing a SSP about adding a volume filter.)  On some stocks I have suspected that SSP is the 'momentum'.

[Super Stock Picker]

Hi guys,

So, yes, we already had in mind to add a volume filer to our screens. We had run a test on the side with a minimum of 50,000 shares a day (3 month average) and it had made almost no difference with the portfolio as you know it.

The think is that the threshold was too low as for instance RMX has an average volume over 300,000 shares a day and it does not seems enough.

But raising the bar two high will exclude some of the good candidates...

[garilou]

Hi SSP,

I think we talked about MKX and not RMX

RMX has a 150 days average volume of 249,316.
MKX has a 150 days average volume. of 61,350

If you consider them in the past 15 to 20 days:

RMX, apart on day with 1,412,700, usually stay in a bracket between 220,000 and 700,000.
And the individual trades are somewhat better evenly spread over the day.


MKX, on its side, stays more in the bracket between 10,000 to 16,000, with some well under 2,000!, the average being raised by a few "big" days with more than 350,000.
And apart from "huge" block trades there is about nothing all through the day.
At any given moment, the bid is around 1500 maximum, and the prices between ask and bid are pretty far apart, which made me think twice: at what price would I get them.

But OK, if you say you have back tested, I guess I'll buy to market and see.
If it goes up a big ride, I guess it should make little difference.

Louise

[Super Stock Picker]

Hi Louise,

You're right, we picked the wrong ticker to check the volume.

MKX indeed is just over the bar of 50,000 we had tested, but it might need to be raised.

Also, MKX is a 1.8$ stock, so with 50,000 shares traded a day, it makes less than 100,000$ exchanged every day in average. Indeed, that may be too low.

[garilou]

Thanks SSP,

I don't know if your system is able to evaluate the daily volume by "soothing" the huge block trades, and maybe introducing a sort of count of how many trades are done in one day.
This info is available even to me, so I guess you would not have problem to get it also.

Like by now (11:14 AM) the last trade on MKX was at 10:07, in total 4 trades, where I suspect that the 2 firsts were one and the 2 others too.

Anyway, I thing I won't buy MKX until it goes back over 1.84, 1.85.

Louise   

[Victor]

Hi Louise,

Just wondering where you found the number of trades info.

Cheers,

Victor

[garilou]

Hi Viktor.

You can get number of trades info partly for free (if there were not too many trades) on Stockwatch , when you ask for a quote.
Underneath the quote you get the Recent Bulletins and then the  last 10 recent trades - (including volume and  - for canadian stocks only  - which institutions bought and sold).
For MKX, on that day that would have been almost enough  !

If you are a paying member (the lowest level is very cheap: $5.20/month), you can also get the evolution of shorts on this stock, which can be very informative (updated only twice a month),
and for any previous day, the block trades, http://www.stockwatch.com/swnet/market/market_blockt.aspx where you can select many options (minimum volume of the block trades, minimum $ Value, and other choices and sort options.)

I like to see who bought what and at which price, even if you see only the trading institutions:
I have often checked what TD sec made on a day with a stock that had been described as an "Action buy" on TD Waterhouse, and often noticed that their recommendation provoked a buying pressure, meanwhile TD Sec. sold in blocks!!! which made me very septic about their buy recommendations...

You can also make a search into SEDAR.(the site still says it is free for a while, but I've tried without logging in, and it is not free anymore), I had to log in order to access it.
While there are many features that you can access with the minimum subscription level that are not described in their description for that level, there are others functions that you get for free and better on other sites.

Louise.

[bryanmcn]

How did EXT pass the volume screen?