2016 continues to be a very tricky year for dealing in shares

Date

3/14/2016 5:50:17 AM

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(MENAFN- ProactiveInvestors - UK) The Naked Trader Thu

2016 continues to be a very tricky year for dealing in shares.

The oil price seems to be the only thing that matters with shares in that area and commodities all over the place.

These types of shares which can move up or down 20pc in an hour or two
are beloved of stock market gamblers.

Sometimes of course they get lucky and will be on the right side of it which is when they'll brag to their friends of the 30% they just made.

But the market doesn't give easily and what you get easily can often be given back pronto and more.

What the gamblers make they will inevitably give back it's only a matter of time usually. They're after excitement: after all who wants boring old companies that make money from boring things?

Even more exciting than betting on commodities is "binaries" "Binary options" and all kinds of fancy names for what is essentially gambling.

I can't tell you how many mails I have had from people who have done their brains on all this stuff. Also the number of hopeful mails I get where you just know they want me to validate it.

"I've had this mail from a cfd/binary/system company who say I'll make lots...."

I know they want me to say "Great idea!! Give your money to someone you don't know!! Yes!! Buy that amazing system... After all who wants to bother to actually put any real work into stock market investment!!"

They don't want my reply which is.. it is all bollocks you'll lose your money don't say I didn't tell you. Bet you they carry on with it anyway.

The lure of quick "easy" money is always going to be too strong to resist for many - and those at the other end they don't care about you - they just want to find the next mug punter and relieve them of as much as possible.

And I'm afraid I do laugh when I read gamblers justifying their trades with technical jargon such as "the 150 day moving gambling average is above the elliott wave line." It's all meaningless drivel.

The more jargon someone uses the less capable they are and just want you to take them seriously or they just want some attention. (They're not getting any at home I reckon).

Anyway you can read more on this in my upcoming psychology book - should be out in 3 or 4 months.

Best thing for sensible folk is to avoid all this stuff. Of course it is hard when you see a commodity stock that went up 50% in two days and you think "I could have made a fortune." But also consider you would have probably given it back as you'd try and repeat the trick.

Overall the markets almost certainly carry on being volatile for a while. There's brexit china possible more QE and all kinds of nonsense to ensure that. And what's some bloke (Draggi or something) saying as I write this?

Well frankly I don't understand much of what he's on about but I hear lots of negative words. My understanding of it is "We are in the s***. So we're going to throw loads of money at it and hope for the best.

Indeed the more he talked the more I felt like getting a short on. So I did. See how it goes.. edit.. good stop now in at breakeven!

Anyway you can stay out of the way of volatility with some shares. And you can make some on the downside with some shorts.

But if you do say short the FTSE be careful not to stay in the shorts if the market moves against you. For example a lot shorted the market near the bottom at 6600 and 6700 and still in those shorts. That means that they didn't make much on the way back up. Best to have stops on the shorts come out when the market moves up you can then try and get back in higher.

Also what people don't tell you is there is quite a cost to keeping shorts on the ftse open for a lengthy time including paying out dividends every Thursday.

***
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21st for beginners and improvers email me at [email protected]/* */ for details.
***

So sticking with my boring old fart type trading now... (oil gamblers may now leave for Twitter)...

Let's kick off with a buy or two of mine in hopefully non volatile stocks.

I've bought a few Interquest (ITQ) - a nice set of results this week - profits going up nicely and debt is coming down plus a decent dividend hike.

Also looks to be a reasonably safe one to hold in volatile times - I think it is worth nearer 100p than 80p.

It's a tech recruitment business with an interesting niche in the next area of high growth tech businesses.

With some patience could be a nice 1-2 year hold for an ISA and sleep at night. No idea why this isn't higher - it should be. At any rate I can't see how it could go down much from here.

I've bought some Quartix (LON:QTX). I've already bought a chunk a while back and doubled on them sold a few but I've bought back in.

A lovely set of results from this company that's in a massive growth area of the market. Profits are booming and there is now net cash.

Management looks to be excellent here driving the company forward. It's no longer cheap but it looks like the market is prepared to pay a premium for this one and so am I. So despite the price going up there could be more to come in time. Depends on the premium the market is willing to pay.

Impellam (LON:IPEL) is one I have had tucked away in the isa for some time and I have just added some more thanks to its sparking results and it looks really cheap and I'm looking for 1000p on this from the current 800p or so.

Impellam this time round can boast much improved margins - 850p has proved a barrier but that means if it can get through 850 1000p could come quite quickly. Plenty of support for it at 750p where it looks very undervalued.

An oft overlooked share is Powerflute. (LON:POWR). Maybe because it has nothing to do with power or flutes. More like packaging.

A real surge in profits after a recent acquisition and a doubled dividend makes this look worth a lot more for sure over 100p which is what I am targetting - a good performance to see profits go from 8.6m to 37.7m Euros.

I think there is at least 20% upside to come so I'm in for some Power. and Flutes.

With the markets having a very strong few days it seemed sensible to bank quite a few profits made from buying low recently. Mainly though banked some profits by selling some shares rather than Total positions.

I thought ETO results were in line with what was expected but the market still frets about the debt - but with the library worth a million dollars it doesn't worry me personally and obviously I could be wrong. However after an excellent rise I cashed in on some of my recent shares and it's not worth fighting the market sometimes. However kept the ones bought a lot lower. For the site banked a profit of 1071 but looking to buy shares back again on weakness as I think at some point it will get taken out and there will be giant profits to be made.

I sold a few Softcat banking a profit of 1101 keeping the rest.
Xar pretty much reached the target I was looking for and banked a profit of 400
I'm considering buying back on market weakness.

I've also banked profits in Pets at Home (LON:PETS) nice company but looks near the top of its range for now profit of 765 banked. They don't look worth an awful lot more for now and I'd hope for a retreat on the shares for a buyback later this year. Ncc kept drifting down so took part profit for 465 again keeping some of the shares.

A look at recent buys: Market Tech has slipped a touch but as a longer-term buy no problems yet.

St Ives produced a decent set of results and firmly remains on the long-term list. Looks a future cracker.

Picked up the nice dividend in Tritax. Empiric has an offer for new shares and I'll be applying for some new ones at the cheaper price.

Iomart is bubbling along nicely.

Looking at some results: Decent results from Total Produce (LON:TOT) this week and happy to stay in there for more growth.

Cracking results from Empresaria Group (LON:EMR) they really ought to be higher and tempted to get some more.

Worldpay's (LON:WPG) results weren't that well received but I thought they were fine on a longer-term view which is surely why you'd be in them. Paul Mcarthy and Stone looks to have a great future after its results too.

Photo-Me has at last been re-rated took a while but well deserved after its statement Japan going well.