portfolio vital statistics · 3 hour investor newsletter incorporating the “newsletter...

3 Hour Investor Newsletter incorporating the “Newsletter Portfolio” Year 2. Week 40-2018-Mar-10

Portfolio Vital Statistics

• Commenced on 10 June 2016 with $250,000.

• Sat on cash for awhile then first stocks purchased in

week of 7/7/2016

• Now worth $358,018

• Total Portfolio performance since inception 22.48% pa

• Performance on funds invested in securities since

inception 30.61%

• Cash in portfolio $100 (approx) …we’re currently

fully invested


Current Portfolio Valuation.


Since Inception performance table

Performance since inception (PA) incl divs

Newsletter Portfolio (including cash)

22.48%

Stocks in portfolio

30.61%

XJOAI

13.24%

Star Growth Stocks 10.65%

Star income stocks 12.19%

Comment. We currently have 17 securities and about $100 in cash …about 100% invested.

Losers >10% -

Losers 5.1%-10% 3

Losers 0%-5% 4

Gainers 0%-5% 1

Gainers 5.1%-10% 3

Gainers10.1% - 20% 2

Gainers 20%-30% 1

Gainers 40%-50% 1

Gainers 60%-70% 1

Gainers >200% 1

3 Hour Investor Newsletter incorporating the “Newsletter Portfolio” Year 2. Week 40-2018-Mar-10 Portfolio comment.

• 10/17 stocks closed green for the week.

• All stocks are in hold territory…hmmm BHP and NHC seem close to hitting sell signals

• Are we overweight? Two stocks A2M (21%) and SVW (14%) weigh heavily. Should I lighten

up on these? I’ve been reluctant to sell whilst they’ve been going up. What do you think I

should do please?

Status of US and Aus Markets.

Green RED

USA DJA 1

USA S&P500 1

USA Nasdaq 1

USA Russell 2000 1

USA VIX (inverted (means Green is shown as RED)

1

USA DJA Futures 1

USA S&P 500 Futures 1

USA NASDAQ Futures 1

USA Russell 2000 Futures 1

Aus XAOAI 1

AUS XMD 1

AUS XSOAI 1

AUS XVI (Vix) (inverted) 1

Clear Green ….If we have cash we’d likely invest it


ASX Indices with ROAR above 20% and above 10%

ASX indices which closed the week with ROAR 6month) above 20%. (purpose of this section….if an

index is going up…perhaps consider looking at its component stocks to check for anything worth

buying).

Indices growing > 20% ROAR 6month or over 10 but under 20%

Over 20%

Over 10%

XAOAI. All ords Total return

XDJ Consumer Discretionary

XEC Emerging Companies

XEJ ASX 200 Energy

XFJ ASX 200 Financials

XGD ASX 300 Gold

XHJ ASX 200 Health Care 1

XIJ ASX 200 Info Tech

XJRAI ASX 200 Resources TR

XMD Midcap 50

XMJ ASX 200 Materials

XMM ASX 300 Metals and Mining

XNJAI ASX 200 Industrials

XPJ Property Trusts

XSJ Consumer Staples

XSOAI Small Ords TR

XTJ Telecommunications

XUJ ASX 200 Utilities

Comment. Metal related

indexes have turned down

sharply. (hence stocks like BHP

are down also)

Health has been the place to be


VALUE index update

Let’s call the value index. How it works: Filter stocks with the following criteria

1. Financial health = strong or satisfactory

2. Dividend yield >2.5%

3. PE <15

4. Price to NTA per share above zero and under 5

5. Enterprise value above $500m

6. Excludes mining stocks and most financials (as advised by Alan Hull)

• We search for (a) sharp increase or (b) decrease in stocks found by this filter.

• If there are many stocks here then “buying value stocks might be a good strategy”….

• If there are few perhaps it indicates we’re at the top of the market?

From this search the following stocks are possibly worth a look: CSR

Comment. Graph still flat…one day it might move

0

2

4

6

8

10

12

14

16

18

Search for Value count


Selling and Buying Report.

As you can see we sold MIN when it hit it’s sell signal. Then by Thursday it seemed to me that there

were clear green signals with US and Aus markets up on the prior week so all of the cash in the

portfolio was released to invest in ING and RHL so that we are fully invested.

Note…one weakness with the Lincoln system (in my opinion only) is that portfolio returns can get a

little distorted when a stock goes ex dividend. Example Say I bought a share of BHP and it has a

share price of $30 and pays a dividend of a dollar and goes Ex Dividend on 1 March and pays cash on

the dividend on say 10 March.

What happens in lincoln looks a bit like this. Stock goes Ex on 1 March (and share value drops from

$30 to $29. At this point Lincoln’s portfolio tool shows my holding as being worth $29 (I’ve lost a

dollar). In reality I’ve lost nothing as I’m due a $1 dividend. Later on the 10th March…magically my

portfolio squares up to be worth $30 comprising $29 in BHP stock and $1 in cash. (of course this

example is simplified as stock prices move around…I hope though that the point is illustrated).

At this time there are over $1,000 in such dividends due to the newsletter portfolio that are not

included in our reported results…this will fix itself over the next few weeks I suppose. My

preference would be that the returns would be included from the moment they go ex.


Stocks worth assessing as suitable for

purchase if conditions are right this week This list will be updated fully after the reporting season is finished

There are loads of things to check out on these lists.

Basic Strategy securities

ETF Strategy Large Cap Strategy

Lincoln Stocks Strategy

Markblatt Strategy

CSR Hack CSR EVN AFG

CUV NDQ SVW NST BPT

EVN BSL

IGO CDA

IMD CSR

NGI CTX

SBM CWP

FXL

IGL

ING

KMD

MNY

NCK

WAN

RHL

RRL

SBM

SFR

WHC

To me it seems that even in a wobbly market there’s good stuff to buy. Under the strategy followed

by this portfolio I’d pin my ears back and dive in

3 Hour Investor Newsletter incorporating the “Newsletter Portfolio” Year 2. Week 40-2018-Mar-10 Strategies explained. Each strategy attempts to find stocks or ETFs that meet the following criteria.

(a) Acceptable Fundamentals

(b) Acceptable daily trade volume

(c) Acceptable market support at current prices.

Go back and read newsletter Year 2 Week 25 for full description of the strategies


Bonus Charts:

In this section I’ll sometimes list a chart that catches my eye and provide a brief comment.

If you want a stock reviewed, perhaps email me and I might include it (no promises)

Chart Comment

HACK Returns

5year 3 year 1 year

NA% NA% 19%

Average daily trade $136k This etf provides exposure to cybersecurity companies (which are supposed to be a high growth industry). It seems to be trending up

CSR* Returns (approx.)

5year 3 year 1 year

27% 20% 32%

• ROE is about 25%

• Div yield is about 6% gross

• PE prospective is about 12.5 This is a big stock with about $11m daily trade. It’s been a good investment across many years.

RIO* Returns (approx.)

5year 3 year 1 year

7% 13% 29%

• Div yield prospective apx 7% gross

• PE prospective is about 12x

• ROE about 24% Suffering from negative USA news I suspect and looks to be tripping over it’s sell signal. If it turns back up (due to a change in news might be a decent buy)

3 Hour Investor Newsletter incorporating the “Newsletter Portfolio” Year 2. Week 40-2018-Mar-10 Parting comment

From the economist magazine.

The above chart shows why metal mining stocks did well over the past 12 months. They’re currently

in a bit of hiatus (with USA’s import duties seeming to spoil the news). What will happen next…who

knows.

USA Bond Prices

What do you see when you look at these charts? I see rising interest rates (which means some bond

holders are losing a lot of money). What else do I see. Downward pressure on stock prices (rising

interest rates are often not good for stocks). Interest rates have moved up a little in Australia…not

the official rate…but the rates charged by banks (or the lower rates paid by Aussie banks to deposit

holders). Rising rates are not good for property markets and stocks.

What does it all mean? This is my message to myself

• Hold the finger over the sell button. Press it firmly only if and definitely if a sell signal is

hit. Don’t press before hand. (well maybe…if a stock represents over 25% of a portfolio

perhaps lighten up a little…not sure about that one)

• Buy good quality stocks that have market support and let them run whilst they appreciate.

• Be disciplined…check for sells daily…check for buys weekly.


• If there’s nothing to buy…don’t chase…just wait. If there’s something to sell…don’t

wait…sell. (note to self…read this sentence a few times and pay attention…I can see that

I’ve been guilty of breaking this rule last week!)

What’s your plan?. Can you describe it clearly. Can you write it down. Can you follow it with

discipline. If not what is the very first thing you can do to make the plan more concrete, clearer

and likely to be followed?

• Warning. This newsletter is provided for your entertainment only, I’m not a financial adviser, I have not taken account of your objectives, financial situation or needs. You should therefore consider the appropriateness of any descriptions of my Newsletter and its newsletter portfolio in light of your objectives, financial situation and needs, before taking any actions.

• All views and information expressed in this newsletter are not the views of Lincoln and or its directors, agents, representatives and employees.

• Many of the graphs and screen shots are taken from Lincoln services and are fully credited to them. I’m a paid up licensee to Lincoln, otherwise all IP in their system and graphs belongs totally to them. I recommend that you consider signing up to their service…it’s a great service and I feel great value for money!

• I do invest and trade in shares, I’ll usually mark the ones that I own with (** or *)…however it’s safe for you to imagine that I’m either buying or selling just about any stock in the market, particularly and especially if mentioned here.

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