End of Financial Year Update

Well, for all of you who may be following my blog, you may think I have given up. The way the market has been for the last six months it could have been a good idea. Actually I have been very busy renovating my house (never again!) plus having a month's holiday in Europe. Since March, I have really only had a couple of open positions that haven't been stopped out. The account is down about 4% from the absolute equity high in January, so no real harm done.

The last two weeks has seen a couple of buy signals appear, so perhaps we may get a small bullish period running into Xmas again. The signals for this week are CFU, RRL and FRS .

Jan to March Update

Three months work and a small amount of anguish for a zero return.

The markets have actually been pretty resilient considering what has happened in the world lately. Plus, we are into the second year of the upswing in the economic cycle, which typically last about 5 years , so better times ahead possibly.

2010 in Review

2010 was a fairly difficult year for trend following strategies on Australian equities. The first six months was characterized by uncertainty in the world economy and this was reflected in the way markets behaved with no clear direction and a number of short and sharp reversals. However, eventually some trends developed on the back of improving economic fundamentals.
With mechanical systems trading, you grade yourself not on the analysis of each trade but on how well you executed your trading system. So on this basis I feel I have been successful.

October 2010 Performance

It is quite nice to be in the black for the YTD, when the All Ords Index is still negative for the year. It has only been the last couple of months that some trends have developed and these have been mainly in the small resources and companies servicing this sector. This does re-inforce the 2 speed economy that is the new catch phrase in the press. I'm also holding FLT & WEB - both travel and undoubtedly helped by the soaring AUD making overseas holidays very attractive. Graincorp(GNC) also is looking promising - I'm guessing on the back of all of the rain we have had.

I will also explain my performance table. VAMI is an acronym for 'value added monthly index'. Basically it records the movement in the account from the change in value of investment. In trading terms this means total equity, both open and closed trades. VAMI is the accepted method used by hedge funds for recording performance.