Investing

Trading idea- Based on Graham (TSX)

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  • Sep 18th, 2017 10:07 am
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Newbie
Mar 30, 2017
15 posts
1 upvote
Hi Rodbarc.

On your first page you mentions

"To mimic the performance of this model, one would equally buy the current holdings, hence the suggestion to start with at least $10k ($1k each). I personally prefer to start when the model was rebalanced, even though if stocks have huge gains. If the model doesn't have a sell signal, it's very possible to continue appreciating in value. Since one might buy a stock during rebalance that is being held for a long time, one might be subject to losses if that stock declines when it's sold (while the ones that bought in the original buy signal might not experience that loss, because they bought way earlier)."

I Understand that, so what I am thinking is to start by buying the stocks when first recommended and slowly work up to the holding. So say I only buy XTC and GIL now and keep 80% in cash until the next change (sell/buy). IF XTC and GIL is not a sell but there are 2 other buys, then I would buy them and keep 60% in cash. This help mitigate the loss of buying an existing stock in the portfolio and having to sell it at a loss for me but a gain for anyone else who may have bought it earlier.

What is your opinion on this approach and what has your turnover experience been with the stocks in the portfolio?
Deal Addict
Jun 3, 2009
3603 posts
425 upvotes
Montreal
boyohboy wrote:
Jul 5th, 2017 9:03 am
GIL up 5% from the pre-market bid-ask....

EDIT: ... didn't hold...
The premarket bid and ask of anything TSX listed really doesn't mean much.
Newbie
Oct 20, 2011
7 posts
I know what you mean. I got started around mid June, and decided to mirror the model as is. SIS is killing me right now with a 10% drop. I know for folks that started from the beginning they are not dealing with the same losses on SIS like I'm seeing. Although, the pain on CTC is not as bad if you started a little later. I just hope that it all balances out.
RCOnline wrote:
Jul 5th, 2017 12:46 pm
Hi Rodbarc.

On your first page you mentions

"To mimic the performance of this model, one would equally buy the current holdings, hence the suggestion to start with at least $10k ($1k each). I personally prefer to start when the model was rebalanced, even though if stocks have huge gains. If the model doesn't have a sell signal, it's very possible to continue appreciating in value. Since one might buy a stock during rebalance that is being held for a long time, one might be subject to losses if that stock declines when it's sold (while the ones that bought in the original buy signal might not experience that loss, because they bought way earlier)."

I Understand that, so what I am thinking is to start by buying the stocks when first recommended and slowly work up to the holding. So say I only buy XTC and GIL now and keep 80% in cash until the next change (sell/buy). IF XTC and GIL is not a sell but there are 2 other buys, then I would buy them and keep 60% in cash. This help mitigate the loss of buying an existing stock in the portfolio and having to sell it at a loss for me but a gain for anyone else who may have bought it earlier.

What is your opinion on this approach and what has your turnover experience been with the stocks in the portfolio?
[OP]
Deal Addict
User avatar
Dec 14, 2010
4186 posts
3073 upvotes
RCOnline wrote:
Jul 5th, 2017 12:46 pm
Hi Rodbarc.

On your first page you mentions

"To mimic the performance of this model, one would equally buy the current holdings, hence the suggestion to start with at least $10k ($1k each). I personally prefer to start when the model was rebalanced, even though if stocks have huge gains. If the model doesn't have a sell signal, it's very possible to continue appreciating in value. Since one might buy a stock during rebalance that is being held for a long time, one might be subject to losses if that stock declines when it's sold (while the ones that bought in the original buy signal might not experience that loss, because they bought way earlier)."

I Understand that, so what I am thinking is to start by buying the stocks when first recommended and slowly work up to the holding. So say I only buy XTC and GIL now and keep 80% in cash until the next change (sell/buy). IF XTC and GIL is not a sell but there are 2 other buys, then I would buy them and keep 60% in cash. This help mitigate the loss of buying an existing stock in the portfolio and having to sell it at a loss for me but a gain for anyone else who may have bought it earlier.

What is your opinion on this approach and what has your turnover experience been with the stocks in the portfolio?
The problem with this approach is that you won't mimic the model's performance. You'll be at 80% cash and 20% invested. I'd rather hold all holdings starting on the last rebalance. Many stocks are highly ranked, there's no reason to skip them and only hold the two mentioned today.

If you buy all holdings today, your performance a month from now should match the model's performance from now to a month from now. By holding the majority in of this portfolio in cash you're limiting your upside, while you're fully exposed to the downside of these 2 companies. The 10 holdings help to mitigate that issue.


Rod
Deal Addict
Dec 6, 2006
3633 posts
640 upvotes
Toronto
Not a good start for 2H 2017... RCOnline lucked out if he hasn't fully invested following the model yet :)
[OP]
Deal Addict
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Dec 14, 2010
4186 posts
3073 upvotes
July 10, 2017 signal:

No action required.


Rod
Member
Nov 13, 2011
375 posts
92 upvotes
Vancouver, BC
Tempted to sell SIS on this rally and capture my gains before it drops more.. and like it's close to dropping out at rank 80
Deal Addict
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Jun 19, 2009
4479 posts
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Scarborough
darkcloud8282 wrote:
Jul 12th, 2017 11:38 am
Tempted to sell SIS on this rally and capture my gains before it drops more.. and like it's close to dropping out at rank 80
Haha, I was tempted to sell at 17.50 but I had to listen to the model...
[OP]
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Dec 14, 2010
4186 posts
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SIS ranking is dropping, but it's not a sell yet. Currently it's at 83.2. Nothing wrong with locking profits. I'm still holding it until it becomes a sell.


Rod
Deal Addict
Dec 6, 2006
3633 posts
640 upvotes
Toronto
darkcloud8282 wrote:
Jul 12th, 2017 11:38 am
Tempted to sell SIS on this rally and capture my gains before it drops more.. and like it's close to dropping out at rank 80
Capture the gain should be done while it was like +57% hah,
rodbarc wrote:
Jul 12th, 2017 12:29 pm
SIS ranking is dropping, but it's not a sell yet. Currently it's at 83.2. Nothing wrong with locking profits. I'm still holding it until it becomes a sell.

Rod
So what's the biggest change for the overall ranking drop? Is it mostly the momentum, since SP is dropping a lot?
[OP]
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Dec 14, 2010
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boyohboy wrote:
Jul 12th, 2017 1:16 pm
So what's the biggest change for the overall ranking drop? Is it mostly the momentum, since SP is dropping a lot?
The ranking is made of several criteria, and scores are assigned according to the rules posted on the first post. It was losing score on value, as it keeps getting overvalued. The other metrics are fine. For this weekend, the score improved and now TIH is the one with lowest ranking so far.


Rod
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Jun 19, 2009
4479 posts
718 upvotes
Scarborough
TIH with lowest ranking of 85, so there's no action this week?
[OP]
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Dec 14, 2010
4186 posts
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July 17, 2016 signal:

No action required.


Rod

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