Saturday, February 12, 2011

When to Sell?

Last February 2010 I became a technical sub-advisor to Stonebrooke Asset Management Ltd. who manages the Hybrid Investment Program under the Elite Wealth Strategies program for Union Securities Ltd. The Hybrid Investment Program is a discretionary service managed by Stonebrooke Asset Management Ltd., using both “fundamental” and “technical” analytical tools to construct clients' portfolios. Our 12-month return is almost 19% vs. about 15% for the TSX60 index. Not bad considering we are only 80% equities and 20% fixed.

We had some big winners, Gerdau Ameristeel (takeover), Biovail (takeover) along with picking the lows on Agrium, Bombardier, Manulife and Precision Drilling. The problem is always when to take the money and run.  We bought Precision Drilling in the low $7 range last October because it was a beaten up former trust that was displaying early relative out perform vs. the TSX60. The energy sector was also moving up in our weekly MOM tables. So far at $10.94 there is no reason to sell with the price well above the 10-week lowest low price channel and well above the average true range (ATR). The selling trigger is quite different on the shorter daily chart with a sell on the ATR and 10-day lowest low at just under $10


chrispycrunch said...

Biovail AKA VRX is at 52wk highs. any comment on where or how much higher this stock will move? said...

Hi Chrispy

No sign of a top on VRX ($40.72) yet - on the daily the 10-day lowest low is $36.12 and the true range stop is $37.74 and the weekly is $30 - a long way down - on the monthly I see some overhead at $48

Bill C