Friday, 26 July 2013

Trader's Diary 25/7/13

By Smoking Gun

Been swamped with work and a stream of friends and relatives visiting all at the same time during the last few days, so not been updating my blog on a daily basis. A few trades were done in the mock portfolio. Here is how the portfolio stood at day end.

Disclaimer: This is a mock portfolio and all trades referred in the the context of this mock portfolio are purely hypothetical based on actual prices observed during actual trading. This mock portfolio only serves merely to demonstrate the methods in my stock picking and trading strategy and does not represent a solicitation or recommendation to buy and sell any security or financial instrument. The author and/or interested parties may have positions in the stocks mentioned. The content on this site is provided as general information only and should not be taken as investment advice. The ideas expressed are solely my opinions. Any action that you take as a result of information, analysis, or commentary on this site is ultimately your responsibility. Consult your investment adviser before making any investment decisions.

During this period, I added 200,000 shares of Centurion to the portfolio, while I took profit on 200,000 shares of OKH Global at 0.515 for a 14.4% gain. Overall portfolio is up 1.2% since inception, while cash uninvested still stands at nearly 60%. The portfolio shall be more reflective of the efficacy of my trading methods once the invested portion of the portfolio is closer to 80%.

Here's my rationale for the Centurion trade which took place on the 17 Jul 13.
 Looking at Centurion's M index, from a reading of 2.52 to 42.69, it jumped up to 270.72 yesterday (16 Jul 13) and carried over to 334.85 today (17 Jul 13). This was accompanied with rising prices and MFI and successfully broke its 52 Week High (BrH%). Breaking the 52 week high is normally a precursor to a continuation of the uptrend.

My rationale for selling out on OKH
My sell signal is based on the readings of the MFI. An drop in excess of 3 points will prompt me to liquidate my positions. On the circled readings on the MFI, yesterday's reading of 69.44 which was a drop of 3.5 points from the preceding day, prompted the sell yesterday. This was confirmed by weaker prices today. A drop in the MFI in excess of 3 points will indicate a significant money outflow, and as part of the trading discipline, we shall exit if this happens even at a loss (in this event, we made some money)