A nice day out – London Investor Show 2014
The fourth presentation was a round-table discussion on the investment outlook for 2015 chaired by Adam Shaw and featuring Nicola Horlick, Rakesh Shah, Tomas Carruthers and Gavin Oldham. Key negative factors identified were the recurring Euro crisis, the UK election, the end of QE, thin UK trading volumes, continued deleveraging by the banks and a possible UK referendum on EU membership.
Positives included continued low interest rates and the search for yield, the low oil price and continued technological revolution. The panel was split on whether the FTSE would rise or fall but there was enthusiasm for the idea that 2015 might be a trading and stockpicking year rather than a buy-and-hold one. Small caps and investment trusts were recommended.
The fifth lecture was by Rodney Hobson and covered investing for retirement. Rodney pointed out how long retirement can be today, with many people hitting 65 expecting to live until 90. He warned against equity release, recommending downsizing your property as the best way to release cash.
He predicted the end of the annuity because of the recently announced UK pension freedom and urged the audience not to take their money out of their DC pensions and squander it. Annuity sales are down 40% already, with the reforms not due until April 2015.
He cited the example of Australia which recently implemented a similar scheme. Thirty-two percent of funds withdrawn were used towards home improvements, 19% was spent on cars, 14% on holidays and 5% on gifts, leaving only 30% to be used towards living expenses.
The rest of the presentation covered asset allocation. Rodney was pro UK dividend stocks and large US stock from complementary industry sectors, as well as US and German bonds, and investment trusts. He was neutral on corporate bonds.
He was against gold (no income stream, volatile), gilts (overpriced, with risk of sales from pension funds as withdrawals increase from 2015), emerging market bonds and alternative assets such as antiques, collectibles, art, wine and cars (high costs and changing fashions).
The ideal was a balanced portfolio which provided income, a hedge against inflation, a spread across assets, sectors, company sizes and geography.
The final presentation was by Sandy Jadeja. This was another trading pitch – Sandy is a technical analyst with a media profile who runs training courses. His stated focus is simplicity, though his fast-paced talk grew increasingly difficult to follow.
Sandy uses monthly, weekly, daily, 60- and 15-minute charts. He wants to know if the market is: bullish or bearish, trending or consolidating, contracting or expanding, ranging or breaking out, contracting or expanding in range, and increasing or decreasing in volatility.
He recommended that we trade a single time frame using a single strategy. He stressed risk and money management and the use of trading rules to counteract emotion. He recommends cutting out all the noise (eg. the TV and the internet) and waiting for the right signal to arrive. Mistakes are inevitable and not to be dwelled upon.
Sandy then ran us through a few techniques at full speed:
- bullish and bearish 2-candlestick patterns (harami and expansion)
- parabolic stop and reverse (SAR) breakouts
- weekly and daily MAs for entries that match the major trend
- MACD and MA (use MA for entries that match the MACD trend)
- 8am indication (1st hour of trading as direction setter for the day
- solar flares (movement on peak flare day sets sentiment for the following week)
There were others, but it was the end of a long day and Sandy was now speaking too quickly for me to keep up with. The solar flares indicator was a new one on me, so I guess I did learn something on my nice day out after all.
Back soon with a detailed review of the Stockopedia presentation.
Mike Rawson
Mike is the owner of 7 Circles, and a private investor living in London. He has been managing his own money for 40 years, with some success.
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[…] first presentation in the main auditorium at the London Investor Show was by Edward Page-Croft from Stockopedia, a company which sells subscriptions to a stock-screening […]
[…] up was Sandy Jadeja, who we’ve met previously at the London Investor Show back in October. At that show he gave a fast-paced and somewhat confusing talk about technical […]