Amit's Trading Diary and Notes

[omufrench]

Hi,
That last one was a wild week. I haven`t been able to isolate a trend. More red in the portfolio. Though, my belief of gold being an "inflation hedge" has been shaken. The averaging-into-positions has helped me keep the losses low. This week should be filled with more pruning of the portfolio.

My portfolio :
Symbol, Entry Price, %Gain, % of Portfolio
GOLDBEES, 2999.34, -3.45%, 56.59%
HINDALCO, 133.33, -2.46%, 14.32%
GUJNRECOKE, 22.78, -4.08%, 14.25%
VESUVIUS, 350.50, -0.50%, 3.44%
FKONCO, 109.50, -2.88%, 3.46%
CASH, 0.00, 0.00%, 9.06%

The explanation :
1) GOLDBEES - I am waiting and watching it. The trend on US Gold Futures is a down-trend. The "inflation hedge" theory has come under serious scrutiny. :annoyed:
2) HINDALCO - This share moved down last week. I haven`t increased the position.
3) GUJNRECOKE - I sold this position only to see it move up about 5% (in 1 and half days). So, I re-entered only to have it move down on me. There is a definite up move. The targets of about 28 and 35 are being aired.
4) VESUVIUS - This stock made a W recovery pattern with apt volumes. So, an up-trend could be on the cards. I am using 348.9 as a stop-loss.
5) FKONCO - This stock is, also, coming off a W recovery pattern with apt volumes. I am using 108.2 as a stop-loss.

Also,
1) AUROPHARMA - Cutting the position has been a good idea. The stock was moving with the NIFTY. It collapsed under the pressure. :clap:
2) NMDC - This stock moved below the stop-loss comprehensively. I cut this position, taking a loss of 2.05%. The size of the position was minimum.
3) PRISMCEM - This position was stopped out. It was loss of -1.57%. Again, this was a minimum position.

Thanks for reading,
Amit

 

[omufrench]

Hi,
A start of a new week. After a dismal two weeks of failing to trade breakouts, I have had to dump a lot of the holdings. The strategy of position-entry has been changed to a more conservative one. I was aggressively seeking entry into positions, because of my belief that if I wasn`t in, I was missing the bus. This can on yield results if my picks are correct. The volatile market wasn`t helping, either.

My portfolio :
Symbol, Entry Price, %Gain, % of Portfolio
GUJNRECOKE, 22.78, -4.52%, 14.29%
KSCL, 1480, -4.71%, 3.29%
POLARIS, 135.26, 3.17%, 3.17%
VESUVIUS, 350.50, -1.57%, 3.45%
CASH, 0.00, 0.00%, 74.49%

The explanation :
1) GUJNRECOKE - This position is hovering near my stoploss. I am watching it closely for an exit/recovery.
2) KSCL - This stock came off a V recovery. It is on a up-trend for this year. I was using 1420 as a stoploss. If it fails to make an up-move, it will have to be cut.
3) VESUVIUS - This stock is below my stoploss. I am looking at it closely for cues for exit.
4) POLARIS- This is the first stock, I am buying, with the new strategy. It is a breakout at high volumes. IT is bullish because of the results. I am using 131.9 as a stoploss. :clapping:

Also,
1) HINDALCO- I cut this position when it moved below 127. I bungled the execution of the exit. I exited at 121.84.
2) GOLDBEES- This ETF trade was my first attempt at an 'inflation-hedge'. I was trying to hold it like a SIP. That was obviously a bad idea. It is moving around 2900. An up-move will be a result of panic. No country looks to default in 6 months.

Thanks for reading,
Amit

 

[omufrench]

Hi,
It has been a bad week. Three in a row. I am sitting in cash now. It has been a while since I have done that.
The results season has been murderous. I plan to trade with my new strategy looking for entries. Also, the scale of chaos has made Gold attractive.

My portfolio :
Symbol, Entry Price, %Gain, % of Portfolio
CASH, 0.00, 0.00%, 100.00%

Explanation:
1) GUJNRECOKE - This position was stopped out. I took a -7.8% loss.
2) KSCL - This position was stopped out too. I took a -5% loss
3) VESUVIUS - I existed this position at a -2.33%. It turned out to be a good thing in hind-sight.
4) POLARIS - This one had bad results. On seeing this, I exited immediately at about 126 at a -7.8% loss. It is at about 108 now.

It has been a humbling experience. The small position sizes and stop-losses have kept the losses at bay. In the words of Warren Buffet -"The first rule of investing is don't lose money; the second rule is don't forget Rule No. 1."

Thanks for reading,
Amit

 

[omufrench]

Hi,
The result-season is almost over. Next big event seems to be the budget. There are expectations that FM will give the markets a spectacular boost through new reforms. I can't help but feel that the build-up to the budget will be a bull run ending in profit-booking.. kind of a "buy-the-rumour, sell-the-news" trade.

My portfolio :
Symbol, Entry Price, %Gain, % of Portfolio
GTL, 24.16, -1.09%, 3.76%
GOLDBEES, 2888, -0.56%, 13.76%
MONNETISP, 254, -0.73%, 1.40%
CASH, 0.00, 0.00%, 80.91%

Explanation :
1. GTL - There was support at 23.80 and the RSI was lo. The support seems to be broken comprehensively. I want to exit this position. :annoyed:
2. GOLDBEES - The price of gold looks attractive at current levels. Money printing by central banks hasn't ended. Gold should go up. I will be looking to increase this position at this level.
3. MONNETISP - There is support at 250. The RSI is low.

The new positions are being acquired in a new more conservatively arranged averaging, to manage the risk. This is why I am not bothered by the RED in the portfolio.

Thanks for reading and feel free to comment,
Amit

 

[omufrench]

Hi,
Another dull week looms. NIFTY is trading in a sideways pattern. New picks seem treacherous (or may be it is just my bad form). The currency wars are on at full-volume. The race to devalue own's currency should make commodities especially, Gold dearer. Venezuela devalued its currency (in Friday) by 46%. While it is too small an economy to matter, it shows the disturbing trend of things.

My portfolio :
Symbol, Entry Price, %Gain, % of Portfolio
GOLDBEES, 2882.17, 0.13%, 20.87%
POLYPLEX, 199.07, -1.29%, 4.55%
MONNETISP, 254, -2.17%, 1.41%
CASH, 0.00, 0.00%, 73.18%

Explanation:
1. GOLDBEES - Gold is attractive at these current levels. I have increased my position.
2. POLYPLEX - This stock is going to have its results on the 14th. I am looking to play the results in a new way.
3. MONNETISP - This stock is also having its results on the 14th. I want to watch this stock for any weird pre-result movement. I have been burned twice on result-days.

Also,
1) GTL - I sold this off on the day of the results (before the announcements). I sold at 23.28 (-3.46%) only to see the stock jump to 25. :annoyed: Though position was too small to matter, it brought to light the flaws in the current approach. My strategy has changed.

Thanks for reading, as always.
Amit

 

[omufrench]

Hi,
There are 9 days to the budget. They are holding it on the last Thursday of the month i.e. Expiry. I have been wondering whether that is on purpose.
I have been loading up on Gold. It is falling and seems like a bargain now. The falling prices hasn`t dampened the enthusiasm, though. Indian Gold imports are at a 18 month high. A Bad Budget could cause a fall in the stocks and/or an increase in Gold prices. In any case, Gold will hold its value in case of currency devaluation. 18 of G-20 nations are actively engaged in devaluation.

My Portfolio:
Symbol, Entry Price, %Gain, % of Portfolio
GOLDBEES, 2869.08, -1.31%, 41.81%
HMT, 39.20, -2.30%, 1.68%
CASH, 0.00, 0.00%, 56.51%

Explanation:
1. GOLDBEES seem like a bargain now.
2. HMT came off a Bull-Engulfing with apt volumes. RSI was lowish too.

I was unable to play the results for MONNETISP and POLYPLEX with a new strategy of stoplosses. Results have to be avoided for now.
1. POLYPLEX was sold at -10.58% on Friday, 15th Feb.
2. MONNETISP was sold at -8.07% on Friday, 15th Feb. I sold too soon. It came back sharply.
Lessons learnt. Also, Position Sizing seems to keeping the losses in check.

Thanks for reading. Comments are welcome.
Amit

 

[omufrench]

Hi,
This is an overdue update. Cause of Delay: I was busy with personal stuff. The budget is over. The market turned bearish on the very same day. The price movement on Gold is mystifying. It has been slammed down repeatedly for days in row [ http://www.zerohedge.com/news/2013-02-20/precious-metals-morning-slam-right-schedule]. This has to be contributing to the low value.

My Portfolio:
Symbol, Entry Price, %Gain, % of Portfolio
GOLDBEES, 2849.23, -1.52%, 55.74%
CASH, 0.00, 0.00%, 44.26%

Explanation:
1. GOLDBEES - Gold seems to be illogically depressed.

Also
1. HMT - It fell each day after the budget. It was sold when stop-loss was broken. This stop-loss was at -10%. :annoyed:

A lot of stocks have been beaten up post-budget. Makes one wonder about the picture depicted by the NIFTY index value. But, for practical purposes, I am focusing on reduced position sizing and stop-loss strategies. Keynes was right when he said,"Markets can remain irrational a lot longer than you and I can remain solvent"

Thanks for reading,
Amit

 

[PartTime_Trader]

Hello Amit

From your churning it seems that your trading to be swing time frame. For this time frame its better to follow the current trend.

Using concepts (like using gold as hedge) that are valid for bigger (6 to 8 years) cycles will not work in shorter TF of swing trading.

One lesson that you have learned is to limit the position size. Do stick to this rule and limit the position to 10% (you seem to be breaking this rule on gold position)

Wishing you the Best

Cheers
::thumb::

 

[omufrench]

Hi PartTime_Trader,
Thank you for taking the time to sift through and analyse my position. You have a valid point there about the time frame.
Gold is my first attempt to trade on the basis of economics/fundamentals. I am trying to develop a new approach here. You are right about having to increase the time-frame for trading it successfully. That why the trading pattern seems like an anomaly.
Yes, also, Position-Sizing and Stop-losses are keeping me solvent. I intend to adhere to them, faithfully.
Thanks once again,
Amit

 

[omufrench]

Hi,
Another delayed entry. I have been busy. That has hindered the logging. I felt that hopes of a interest-rate cut and IT sector had kept the market up. The thinness of the up-move is seems to be an important indicator of things to come. I am undecided on the direction, NIFTY will take. There is mix of bearish and bullish elements in the portfolio reflecting that.

My Portfolio:
Symbol, Entry Price, %Gain, % of Portfolio
GOLDBEES, 2849.23, -2.11%, 55.58%
WIPRO, 449, -2.90%, 1.61%
SONASTEER, 10.85, -2.76%, 1.62%
CASH, 0.00, 0.00%, 41.19%

Explanation:
1. GOLDBEES - It is my long-term short position.
2. WIPRO - It had broken the resistance at 340 with moderate volume. IT seems to be driving the index.
3. SONASTEER - It made a bull-engulfing with high volume. RSI seems to be low too.

Also, I have broken my bad streak. :clap: Due to the elevated levels of NIFTY, I had bought NIFTY 5500 PE at 8.95 (on 5th Mar) and 6.25 (on 7th Mar). I sold them off today (on 14th Mar) at 15.05. A little premature but the loosing streak has made me question my instincts.

Thanks for reading,
Amit