That’s impressive. How do you go about screening for stocks?
i don’t. you couldn’t screen for this one as they bought assets out of bankruptcy for $10M, so the book value reflected this, but the assets have ~$1.5B in invested capital on site and this capital needs to be valued properly now that the price for this particular commodity has rallied over 100% in the past twelve months. market didn’t really pay attention until now. i’ve followed the stock on and off for ~7 years.
my strategy is to pick 100-200 companies and follow them over time. screens are for robots.
^his strategy is pretty solid. I have a similar mindset.
there is about 5000 stocks if you exclude otcs.
follow only high quality cos, essentially the top 1%. So follow around 50 to 100 cos.
high quality will always be overvalued so you should just track them, but a select few will be cheap every now and then.
if price falls for an overvalued 1, study why it fell then determine value. i dcf them at different growth rates to create a range of values. Usually cheap co’s have a 3:1 reward:risk payoff.
Overall IMO. i think you need a minimum of 5 stocks to go active. 15 is the supposed sweet spot. anything 30+ is more of a detriment imo.
Usually when i buy a stock too, i just keep it for life. im not really a fan of trading. there really isnt that much options too especially nowadays when everything is expensive anyways.
also i think people should have 100k portoflio if you want to go active, but 500k is what you need if you are investing the time it takes to study the cos and not work in industry
Under their rules anyone whose “principal office” is based outside the US, is a “foreign advisor”. So even though in reality I am just another American investment advisor, I can register direct with the SEC, skip all the state stuff, which cuts down on a lot of senseless regulation. I think I’ve decided to frame the brochure offering (for those of you who don’t know, you have to write a whole friggin’ novel) as “separate accounts managed under one investment strategy”, rather than a fund. Separate accounts in IBKR are quite separate and simple to run, without the complexities of pooled money, clients can cashflow in/out easily, and they know “some guy in Asia” can’t run off with their money cause I have zero custodial power. I’m a specialist so clients get minimal customization, the group of accounts does a similar thing, global equities and derivatives (focused on Asia), with some minor tweaks based on their situation. I think this will work, the govies make everything so complicated…
Going to network with contacts in US and Asia, keeping it more like a friends and family small tight group of “smart money”. This seems like a darn tough business, you get a billion mom&pop customers and you want to jump out a window with them micromanaging…or dumb institutional money with so much restriction and you can’t do anything.
I’ve got a systematic mean reversion arbitrage algo that runs trades on a strictly daily basis…been running it since 2007 with the following results:
Here’s hoping! Must admit I thought about scrapping it at the end of 2015 but it’s done OK (ish) last year and hopefully will continue to perform at around the 15-25% return level. It trades index futures but these are unleveraged returns - I usually run around 3x leverage so I feel I’ve done pretty well out of it overall.
That’s terrific S666. That’s exactly what I want to see … good years that far outweigh the inevitable drawdown years. People get so hung up on “beating a benchmark” but I think that is totally a short sighted way to judge performance. I don’t really care if you are beating the S&P. I want to see draw up that is constantly better than draw down. For example, if over the course of 5 years someone has “beat the benchmark” but done so by having returns like +10%, +12%, -30% , +20%, +8%… I’m not interested. Under that line of reasoning, MLA is the LAST person in this thread who I would give money to. Those impressive returns reek of poor risk management and over leverage.
Thanks KMD…and I couldn’t agree more with your reasoning. Benchmarking is for pension funds, not for individual investors/traders…of course there is SOME solace to be had when you’re only down say 5% while the broader market is down say 20%…but I see my strategy as market direction neutral and it’s performance is more correlated to volatility levels anyway.
Without giving too much away, how is your systematic strategy coming along re backtesting/paper trading/live trading. I know you were engaged in formulation and backtesting a little while ago.
Thanks for remembering! Yes, I took my trading live 3 weeks ago. I have been developing as a “discretionary trader with a systematic approach” since September. So no algo. I trade under a plan that starts with context and narrows down to entry setups. Anyway… live! It is terrifying!.. not so much because I’m afraid to lose money, but that I am afraid I will prove myself to be a failure.
I had been journaling about my trading development in WC under a thread called “retail daytrading”. I’m due for an update next week. I had some early success when I was paper trading without even using a demo simulator. Much of that, as it is now evident, was based on unconscious bias …cheating even. The last month of my sim trading was done with an actual demo simulator and the results were more realistic. I am very happy to report that so far in my live trading, going up against algos, big money, HFT and whatever… I am breaking even. (including commissions). I know breaking even does not sound very fancy, but after only a few months exposure and in a negative sum game, I’m feeling pretty triumphant. I am still making a lot of errors in executing my plan, but this makes me hopeful I will be profitable with more practice and less errors
This all has it’s foundations in my strict adherence to favorable risk/ reward… and therefore larger draw ups than draw down. I am pleased with the stability of my performance so far as such a new trader.
I have to say this experience for the most part makes me miserable. I’m terrified I will fail and every losing trade makes me fill this cloud of doubt and fear that I carry with me all day and night. I’m exhausted! Weird… I love it more than ever. One of the reasons I wanted to become a trader because I knew it had a high failure rate and I love being able to do things most can’t do. Well, now I am experiencing 1st hand the reality of how difficult it is. If I can eventually pull this off it is going to feel AMAZING!!
You’re smart - you seem to have all the right tools for success. 
anddd with those bangs, you could conquer the world!
Thanks ACE! In a forum like AF, simple encouragement comes off as surprisingly potent 
i’ve had two single digit losing years in nine. “inevitable drawdown years”. i don’t own beta. you talk about consistency. i’m consistently double and triple digit positive and generally avoid the market when there is nothing that can provide me with obscene returns. preferred share arbitrage and long only mining company trading. do what you know well. also, since i’m only invested 3-4 months per year, feel free to annualize the returns below.
2009: -9%
2010: +234%
2011: +64%
2012: +19%
2013: -8%
2014: flat, no good trades
2015: +47%
2016: +45%
2017: +138%
Was up over 100% last year. Had a couple of small losers, but cut losses quickly. ABX worked out well for me, which drove most returns. Bought on 8/6/15 at about $7, sold on 8/12/16 at about $21.50, date stamped timing documented in thread below.
http://www.analystforum.com/forums/investments/91344716?page=3
As it happens, I had 2 interesting real estate deals come to me at the end of last year, so all non-retirement capital is deployed at the moment. Average modeled equity multiple at refi is 1.8x over an average 15 month time frame, leasing activity already includes unmodeled upside.