Dear All SIG Followers
Following on the recent huge response to Steve Navra talk on Property Investment and recent interest in the concept of Dollar Cost Trading Steve has been invited to talk about this concept at the next SIG.
Who: Steve Navra
What: Dollar Cost Trading (share trading)
What will he do and how long: Assume an hour and a half, powerpoint presentation, including a full share DCT demo will be the go.
Where: Roxby Hotel, 172 St Johns Road Glebe. Food and drink available to purchase in dinner and can be taken up to the room.
When: Tuesday 12th April (subject to confirmation by pub)
Time: 7:15pm for 7:30pm sharp start.
Numbers: limited to eighty (80) attendees
How to book: Post your name and number of attendees (limit of four per member) here on this thread.
No other places or PM’s. Seating available for first 65.
Cost: Free
Want to know more about the subject:
As written by Steve in http://www.somersoft.com/forums/showthread.php?t=19803
In its absolute simplicity the quantitative DCT approach suggests that, as the share price of a quality blue chip share declines, so the share represents a better purchase value opportunity (the share is cheaper). The reverse applies; so as the share price increases in value, it will represent an increased potential for profit taking.
Dollar Cost Trading involves buying potential value at the lower points and frequently locking in gains by selling at higher points, thus maximising the potential from share price volatility. The NavTraDE investment management system quantifies what constitutes relatively low and high points in the actual share price.
It makes intuitive sense to buy shares in quality companies when the share price is falling and to sell when the share price is rising. However, it may take considerable time for share prices to recover to previous levels and beyond. Therefore the full benefits of Dollar Cost Trading will be realised over the medium to long term.
Dollar Cost Trading differs from Dollar Cost Averaging as the latter is only an averaging technique, as its very name evidences. Dollar Cost Averaging does not attempt to identify low and high points but simply involves a set amount being used to purchase shares at regular time intervals.
In the simplest terms then:
• Identify strong and stable Blue Chip Companies.
• Without trying to second guess the market, you would buy when the shares are cheap (Value) and sell when higher to lock in the profit.
• This process of selling at a price higher than the purchase price creates realized gains which are then paid out to the investor as a quarterly distribution. (Income)
• The distributions are remarkably consistent, because they are realized as a result of the overall volatility of all the ‘Blue Chip’ shares in the portfolio.
• It doesn’t matter if the market is going up or down; there always is price fluctuation and thus volatility.
• Even if a share plunges say 20%, there will still be opportunity to trade at the bottom; please refer to the attached file for the example. (Which speaks for itself)
• Furthermore it doesn’t matter even if one is fully in a share and cannot buy more because one has reached the trade limit (10% max or no more available cash); there will still be price volatility at that level and hence trading is still possible. (Value add)
Regards to all, Peter 147
Following on the recent huge response to Steve Navra talk on Property Investment and recent interest in the concept of Dollar Cost Trading Steve has been invited to talk about this concept at the next SIG.
Who: Steve Navra
What: Dollar Cost Trading (share trading)
What will he do and how long: Assume an hour and a half, powerpoint presentation, including a full share DCT demo will be the go.
Where: Roxby Hotel, 172 St Johns Road Glebe. Food and drink available to purchase in dinner and can be taken up to the room.
When: Tuesday 12th April (subject to confirmation by pub)
Time: 7:15pm for 7:30pm sharp start.
Numbers: limited to eighty (80) attendees
How to book: Post your name and number of attendees (limit of four per member) here on this thread.
No other places or PM’s. Seating available for first 65.
Cost: Free
Want to know more about the subject:
As written by Steve in http://www.somersoft.com/forums/showthread.php?t=19803
In its absolute simplicity the quantitative DCT approach suggests that, as the share price of a quality blue chip share declines, so the share represents a better purchase value opportunity (the share is cheaper). The reverse applies; so as the share price increases in value, it will represent an increased potential for profit taking.
Dollar Cost Trading involves buying potential value at the lower points and frequently locking in gains by selling at higher points, thus maximising the potential from share price volatility. The NavTraDE investment management system quantifies what constitutes relatively low and high points in the actual share price.
It makes intuitive sense to buy shares in quality companies when the share price is falling and to sell when the share price is rising. However, it may take considerable time for share prices to recover to previous levels and beyond. Therefore the full benefits of Dollar Cost Trading will be realised over the medium to long term.
Dollar Cost Trading differs from Dollar Cost Averaging as the latter is only an averaging technique, as its very name evidences. Dollar Cost Averaging does not attempt to identify low and high points but simply involves a set amount being used to purchase shares at regular time intervals.
In the simplest terms then:
• Identify strong and stable Blue Chip Companies.
• Without trying to second guess the market, you would buy when the shares are cheap (Value) and sell when higher to lock in the profit.
• This process of selling at a price higher than the purchase price creates realized gains which are then paid out to the investor as a quarterly distribution. (Income)
• The distributions are remarkably consistent, because they are realized as a result of the overall volatility of all the ‘Blue Chip’ shares in the portfolio.
• It doesn’t matter if the market is going up or down; there always is price fluctuation and thus volatility.
• Even if a share plunges say 20%, there will still be opportunity to trade at the bottom; please refer to the attached file for the example. (Which speaks for itself)
• Furthermore it doesn’t matter even if one is fully in a share and cannot buy more because one has reached the trade limit (10% max or no more available cash); there will still be price volatility at that level and hence trading is still possible. (Value add)
Regards to all, Peter 147
