120 replies to this topic

[Pilotpilot]

Making some changes to the Long and Short portfolios this morning.

 

Selling full position in AMS @ R880-00 and JBL @ R0-57 for the Long portfolio, and buying ASC @ R150 or opening price, whichever triggers first. ASC has been added to the watch list and has superior growth and risk/reward figures. This would give the long portfolio a 18,1% holding in ASC.

 

See http://www.sharechat...c/#entry291511 for more info.

 

Selling all FSR @ R40-25 and OMU @ R11-67 shares and buying MTN @ R51-42 for the short portfolio.. 

 

MTN shows the highest negative growth currently and has more downside potential than FSR and OMU.

 

If trades don't trigger at the prices given, it will be done at the day's close.

Edited by Pilotpilot, 14 April 2020 - 08:30 AM.

[Pilotpilot]

@PilotPilot, thanks for the great initiative and insights. Can you clarify how one should read the following line (ZAR weakness or strength)

 

17.9689 USD/ZAR 156.9%

 

Hi Shi

 

This is Rand weakness, meaning that the Rand will further weaken at a rate of 156% per annum. We will continue with this very strong weakening trend vs the dollar. All the calculations are done to predict a growth rate and it is expressed over a year period.

 

But this does not mean that the Rand will weaken to R17-97 + 156,9% = R46-16. The 156,9% is only the rate it will change at, (Growth rate). This is a scary figure at the moment. 

 

The other important factor is the trading range, which is not shown because of confidentiality reasons.

 

I will tell you though that the trading range for the USD/ZAR is projected between R13-78 and R22-51. These are the upper and lower limits, and we are still 25% off the upper limit. What the program predicts is that we will weaken at 156% per annum rate up to the trading limit of R22-51, which should be upper limit. This value does change on a daily basis and are adjusted by the program.

 

The rate at which the Rand is weakening is a scary figure at the moment, but the program is pretty much spot on, as we had the Moody's downgrade, which is causing International fund managers to exit their positions within a 30 day period, to abide by their Fund Mandates.

 

Keep and eye out for the Gold, Platinum and other Rand hedged stocks over the next couple of weeks. They should be doing very well up until the R22-51/dollar level.

 

The other scenario is if this level gets broken. This would surely add rocket fuel to this price, and heaven behold what will happen then.

 

Hope this explains it.  

Edited by Pilotpilot, 13 April 2020 - 10:41 AM.

[Shi]

@PilotPilot, thanks for the great initiative and insights. Can you clarify how one should read the following line (ZAR weakness or strength)

 

17.9689 USD/ZAR 156.9%

[Pilotpilot]

2 Months have past into the 3 month "Eat my Hat" challenge since 13 February and the standings for each portfolio are as follows

 

Best Share Picks "Longs" by Program  +5,60%

Top 40 Benchmark  -15,20%

Worst share picks "Shorts" by Program  -29,15%

 

Over the last week the gap between the long and the short portfolio has moved significantly, by more than 14%, and is now up to 34%. The out- and under-performance of (20,80% and 13,95%) above and below the Top40 benchmark, in only 2 months, are now really showing how well the program can identify the best, and the worst of shares on the stock-market. This long portfolio outperformed the Top40 by 20,8% in this 2 months and implies an out-performance of 210% on the value of your portfolio in one years time. Usually a fund would be impressed if they outperform the benchmark by 10% in one years time, and very few actually do. A 200% out-performance would just be a crazy figure.

 

For a hedge fund with gearing these figures would be even more impressive, and a much better selection of trades could be utilized. Figures of 400% growth for a year, could be a possibility. Currently the program are only selecting from 42 shares on the JSE. A wider selection of shares, combined with foreign shares, that utilizes exchange rates, could improve these figures even further.

 

Sasol was a large contributor for the Long Portfolio, as it was the number one pick for some time. It got sold out at R57-20, as it only showed a projected price of R69-00 with limited growth vs other shares like ANG and NHM. ANG has since been the Top pick and has also contributed largly to the long portfolio's out-performance. 

 

Ascendis Health (ASC) has now  been added on the watch-list, with even stronger growth figures than ANG, and will be added to the long portfolio on Tuesday. 

 

With one month to go, the Risk/Reward of both portfolio's are still looking good and further out-performance is expected to continue. 

 

Stay safe

 

 

 

Pilot

Attached Files

•  NEXT LEVEL SHARE SELECTION-GOOD-BAD-UGLY 13-4-2020S.xlsx   26.57KB   19 downloads

Edited by Pilotpilot, 13 April 2020 - 12:18 AM.

[Pilotpilot]

Hi Pilot, what do you have in your short portfolio as a replacement to Sasol at the moment?

 

Hi Spell Jammer,

 

Sasol is in the Long portfolio and I am replacing it with ANG and NHM. They have predicted growth of 100% and 60% respectively.

The reason I am doing it is because Sasol only has 20% growth to R69-00 currently.

 

On the short portfolio, MTN and PSG has the most downside potential. 

[Spell Jammer]

Closing full position in SOL@ R57-20 and buying ANG @ R358-20 and NHM @ R80-50 in equal portions for the Long portfolio.

 

SOL is only showing 20% growth to R69-00 target price.

Hi Pilot, what do you have in your short portfolio as a replacement to Sasol at the moment?

[Pilotpilot]

Closing full position in SOL@ R57-20 and buying ANG @ R358-20 and NHM @ R80-50 in equal portions for the Long portfolio.

 

SOL is only showing 20% growth to R69-00 target price.

Edited by Pilotpilot, 07 April 2020 - 09:58 AM.

[Pilotpilot]

After 7 weeks into the 3 month "Eat my Hat" challenge, the standings are as follows

 

Best Share Picks "Longs" by Program  -15,7%

Top 40 Benchmark  -20,98%

Worst share picks "Shorts" by Program  -35,64%

 

Over the last week the gap between the long and the short portfolio has widened by about 4% and is now up to 20%. Sasol became the number one pick on the shares being watched about 2 weeks ago, and became the largest holding in the long portfolio. Sasol was also the main contributor to the long portfolio's out-performance. 

 

The out- and under-performance of (5,3% and 14,6%) in only 7 weeks are now really showing that the program can identify the best, and the worst of shares on the stock-market.

 

Anglogold Ashanti has now taken over the number spot and pushing Sasol into second place, which still shows value at the R40-30 level. See the file attached. 

 

Although I did not report this, most of the Banks has traded near their support level at the start of this week and have bounced off these levels. SBK has come up as the only buy in this sector, as the others have not shown significant enough growth over the longer term. 

 

MTN, PSG and SNH are 3 of the least favored stocks currently, although they are all trading in the middle of their trading ranges. As a possible short, BTI is identified as  the only "Sell" by the program and is trading at the upper part of its trading range and has a negative growth outlook over the next 12 months.

 

Stay safe and healthy

 

 

Pilot

Attached Files

•  NEXT LEVEL SHARE SELECTION-GOOD-BAD-UGLY 3-4-2020S.xlsx   25.33KB   12 downloads

[Pilotpilot]

Just a quick Covid overview 

 

I have been watching Covid-19 scenario globally and locally, and have been creating exponential graphs and doing some other calculations on the start and possible end. 

 

Although the USA and the UK have cocked it up over the last few weeks, they and most of the world has now realized how to contain this virus, and know what measures should be taken.

 

It seems we have passed our infliction point (26 March) and the growth rate is slowing. Although it will still seem like the virus is spreading fast, it will be some time before we get to a zero growth rate. Social distancing and all the other measures seems to be keeping the spread of the virus under control and lowering the growth rate, as the Chinese have proved.

 

See the values attached

Attached Files

•  Covid-19 14Mar-2Apr.docx   12.02KB   8 downloads

[Spell Jammer]

Hi Spell Jammer

 

CFR (R96-80) is not at the best place to short, but had more downside potential than the other 2 shares in the short portfolio. It is also in the non-essential space, which makes sense given the current situation with Covid-19. 

 

It is showing a projected price of R87-00 in a years time (about -10% down from current levels) and is currently trading midway in its trading range of R73-40 to R124-00. This is a very wide trading range, as most shares currently are, and these are the ultimate trading prices.  

Thanks for the feedback. Much appreciated.

[Pilotpilot]

Hi Pilot, what does your model project CFR going to?

Hi Spell Jammer

 

CFR (R96-80) is not at the best place to short, but had more downside potential than the other 2 shares in the short portfolio. It is also in the non-essential space, which makes sense given the current situation with Covid-19. 

 

It is showing a projected price of R87-00 in a years time (about -10% down from current levels) and is currently trading midway in its trading range of R73-40 to R124-00. This is a very wide trading range, as most shares currently are, and these are the ultimate trading prices.  

Edited by Pilotpilot, 01 April 2020 - 08:03 AM.

[Spell Jammer]

Selling both positions in BVT @ R138-00 and GRT @ R11-86 for the short portfolio.

 

Buying CFR  @ R98-20.

 

or @ the closing price today if they don't trade

 

Both BVT and GRT is at their lower support levels and CFR has more downside risk than those two.

 

Hi Pilot, what does your model project CFR going to?

[Pilotpilot]

Pretty impressive bud ....Nicely Done.

It appears as though the core mechanics of your system seem to be functioning & profitable.

The little you mention where the human element would come in also is interesting & if I understand correctly would of made an improvement in the returns.

Again nicely done....Enjoy the satisfaction of your hard slog & 000's of hrs getting to this point.

I hope the Missus is pleased also...

Thanks a lot Soutie!

 

No Missus here.......yet!   

[Pilotpilot]

Selling both positions in BVT @ R138-00 and GRT @ R11-86 for the short portfolio.

 

Buying CFR  @ R98-20.

 

or @ the closing price today if they don't trade

 

Both BVT and GRT is at their lower support levels and CFR has more downside risk than those two.

Edited by Pilotpilot, 31 March 2020 - 09:34 AM.

[soutie]

Pretty impressive bud ....Nicely Done.

It appears as though the core mechanics of your system seem to be functioning & profitable.

The little you mention where the human element would come in also is interesting & if I understand correctly would of made an improvement in the returns.

Again nicely done....Enjoy the satisfaction of your hard slog & 000's of hrs getting to this point.

I hope the Missus is pleased also...

[Pilotpilot]

Thanks for the recent updates...

How are feeling regards your progress so far & has the program needed any tweeks....?

This last 3wks has given it a good work out...

Your welcome Soutie....

 

I wasn't sure what to expect after 6 weeks, but I am still impressed by the out-performance (3,4% and 11.9%) of the 2 portfolios. On average it is 7,65% in 6 weeks and implies a 60+% out-performance over a year period and even higher when compounded.

 

The biggest obstacle with this challenge was that I needed to stay fully exposed. There were times where the "Long" portfolio where at the higher end of their trading range, and it did not warrant a full exposure with the downside risks. I also had no other shares to turn to, as all were showing a downward correction to come. The same happened with the "Short" portfolio at the start of this week (23/3/2020), where closing some positions and waiting for new opportunities would have made a lot of difference. I also had to do pairing trades, and most of the time the other shares were not bought or sold meeting all the criteria of a normal trade. But taking all into account with an implied yearly out-performance of 60%....I am very impressed and hopeful of a stronger performance for the 2nd part of this challenge. 

 

With regards to tweaking the program, yes I had to change one thing to accommodate the abnormal circumstances that followed after starting this challenge. 6 Days after starting, the TOP 40 fell by 34% in 4 weeks. I was mostly using support levels from the last 3-4 years and all of a sudden these levels were broken in quick succession and I had to use longer term data to identify older support levels from 10 years back. I added weekly long term support levels and I feel the program is now more rounded in making future predictions. I do like it even more and I am glad we are going through this correction/recession to see how it picks shares when it bottoms.

 

With Moody's downgrade, I do prefer the exposures of the portfolios, as the Rand will probably tank against the Dollar and the Long portfolio are mostly exposed to Rand hedged shares.

Edited by Pilotpilot, 28 March 2020 - 04:03 PM.

[soutie]

Thanks for the recent updates...

How are feeling regards your progress so far & has the program needed any tweeks....?

This last 3wks has given it a good work out...

[Pilotpilot]

After 6 weeks, and halfway through the "Eat my Hat challenge" the standings are as follows

 

Best Share Picks "Longs" by Program  -18,9%

Top 40 Benchmark  -22,31%

Worst share picks "Shorts" by Program  -34,22%

 

I would have liked to see the gap widen further between the Best and Worst portfolios over the last 2 weeks, but the 15% out-performance is still a good result, considering the beating Gold and Platinum stocks took recently.

 

I am selling all DRD @  R10-85 and adding CLS @ R249-40 for the good portfolio. DRD is trading near its upper trading levels and CLS is the next best selection.

 

 

 

 

 

 

 

 

Attached Files

•  NEXT LEVEL SHARE SELECTION-GOOD-BAD-UGLY 27-3-2020S.xlsx   28.33KB   12 downloads

[Pilotpilot]

Selling all GFI @ R108-50 and adding to SOL @ R24-50 for the Long Portfolio.

[Pilotpilot]

Selling all APN and Buying PSG for the Short portfolio @ the Close this afternoon.

 

APN is showing upwards momentum and PSG has some more downside to come.