Stocks and Shares - I need your help!

kennysarmy

kennysarmy

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I'm entering a trading game at work that will run from next Monday (17th October) until 27th January 2017

I've got a virtual £100,000 to invest.

The rules are:

Goal: to make as much money as possible by the end of The Trading Game!
Teams achieve this goal by buying and selling shares from the list provided. This list includes FTSE 100 companies, around 50 smaller companies called ‘SmallCap50’and Exchange Traded Funds (ETFs).
Teams will have the opportunity to run two share portfolios simultaneously. The first is the Active Investor portfolio. This portfolio is where teams will make their typical day to day trades, buying and selling shares each day. The second portfolio teams will manage will be the Strategic Investor portfolio. This presents more of a challenge to investors as only 10 trades per calendar month are allowed to be made, which will encourage investors to think more strategically when making investment decisions.
The rules:　
  • The minimum investment in a company’s shares is £1,000
  • Teams can only trade between 09:00 and 16:30 each day that the stock market is open
  • The maximum a team can invest in a company’ shares is 20% of the total value of their portfolio
  • Teams should not hold more than £15,000 in cash, with the rest of the portfolio held in shares. If teams go over this they will be subject to Windfall Tax which is set at a rate of £1,000 for each day that more than £15,000 of cash is held, starting 8 days after a team’s first trade
  • Teams can only make one trade in an individual company each day in their Active Investor portfolios
  • Teams can only hold a maximum of 0.25% of the total shares available in one company
  • Teams can only make 10 trades per calendar month on their Strategic Investor portfolios

Basically I've no idea!

And wondered if there were any good websites out there that would give me good tips and advice in what to buy and sell?

Or feel free to drop any good tips down on this thread.

I'll keep you all posted how I'm doing.

Cheers
 
Interesting competition!

Do you work in finance by any chance, and have access to a Bloomberg terminal? There are some very useful functions in there I can point out if you do... they can help to narrow down the total population of shares to ones rated most highly by research analysts for example, or those furthest away from their consensus target price.

What's on the ETF list? Just UK ETFs? Is there a ETF ticker UVXY?

https://finance.yahoo.com/quote/UVXY?p=UVXY

This tracks the volatility of the US S&P index, which is exceptionally low at the moment. This is essentially a play on negative surprises in the US; election result or Fed could be triggers for a spike in volatility.

Another tip would be to look for shares where you think there may be earnings surprises. Especially with the smaller companies, they can move a lot on earnings dates.

I'm not aware of good websites for analysing shares unfortunately. Perhaps try to find one that gives the "RSI" of stocks. It's a momentum indicator, between 0 and 1. When the RSI is below 0.3, that indicates that the stock might be "over-sold" and hence likely to rebound. The opposite holds true at 0.7

Are you allowed to short sell shares?

Anyway, best of luck with it, sounds like a lot of fun!
 
FJ1000 said:
Interesting competition!

Do you work in finance by any chance, and have access to a Bloomberg terminal? There are some very useful functions in there I can point out if you do... they can help to narrow down the total population of shares to ones rated most highly by research analysts for example, or those furthest away from their consensus target price.

What's on the ETF list? Just UK ETFs? Is there a ETF ticker UVXY?

https://finance.yahoo.com/quote/UVXY?p=UVXY

This tracks the volatility of the US S&P index, which is exceptionally low at the moment. This is essentially a play on negative surprises in the US; election result or Fed could be triggers for a spike in volatility.

Another tip would be to look for shares where you think there may be earnings surprises. Especially with the smaller companies, they can move a lot on earnings dates.

I'm not aware of good websites for analysing shares unfortunately. Perhaps try to find one that gives the "RSI" of stocks. It's a momentum indicator, between 0 and 1. When the RSI is below 0.3, that indicates that the stock might be "over-sold" and hence likely to rebound. The opposite holds true at 0.7

Are you allowed to short sell shares?

Anyway, best of luck with it, sounds like a lot of fun!
Click to expand...

No I have nothing at all to do with Finance! I work in I.T. - but in the education sector and this "game" is for students and staff...

I think I understood 50% of your message :p - I think I'll need more than luck!
 
Just out of sheer nosiness I've marked this thread to keep an eye on what happens, looks like quite a lot of work if you want to do well but good fun just the same. Unfortunately I can't help you at all knowing nothing at all about investing, all as I'd do is invest in new camera kit that I don't need but want. :)
 
Many years ago I joined a share club with guys at work. It wasn't really my bag and I was not an active participant. I did recommend one purchase, an Irish gold mining company:mad:
Needless to say we didn't purchase their shares. We should have because the shares went sky high. Why, because everyone else had read the same report I had and invested. When reality was restored the shares fell back. Just shows what a lottery it can be.

The website I used to use at the time was The Motley Fool - thought that was appropriate - linky

Good Luck.
 
Ah I see!

You don't want to be losing to students - that actually makes it more important to do well than if it was just against colleagues!

So I'd imagine most participants will take the approach to scour the internet, papers, and friends, for individual stock tips.

If you wanted to try something different, RSI is worth considering. The approach would be quite simple; buy stocks where RSI is 30 or lower, and sell ones that are at 70 or higher. (N.B. I incorrectly recalled the scale was 0 to 1 in my earlier post, it is actually 0 to 100)

http://thepatternsite.com/RSI.html

The challenge might be in getting the data!
 
The market responds to information, so be mindful of any announcements your targets are likely to be making - not just quarterly financial updates but also product announcements, launches etc.
The market also has a tendency to over-react to news and then drift back to normality. If you're quick you can arbitrage these intervals, but also be mindful that if an investment tanks it may not be the best move to exit immediately - you might manage a softer exit later (or not...)

If you want to protect your ego, just use a randomised selection and then mock your colleagues if they fail to beat you. ;)
 
Darts. You wants darts. And a monkey.

Seriously, I follow this book to the letter when investing my own pension fund.

https://www.amazon.co.uk/Monkey-Pin...=1476122577&sr=1-1&keywords=monkey+with+a+pin

BTW I recently came 3rd in a "predict the world cup football scores" comp by simply putting 2-1 for every game - all but 2 of the chaps spending days agonising over fixtures and players did worse than me ;). It's remarkable how often emotion gets in the way of predicting real world events.
 
From, experience is something similar (fantasy game in a paper to do with shares in football clubs...) ... you either gamble like anything on low value shares as Millwall were about something like 0.6p, and went to 1.1p a week before the close - I had max poss in them, and came third overall, which got me a meal for 2 in Delia's carvery and watch a game from the posh part for £0.00

or play it canny on what sectors are up and down (real stockbrokers are doing this by the second every day with use of many computers and algorithms)

or c) bet against the £ rising!
 
May be worth looking at Oil companies. OPEC are meeting on 30 the November to discuss cutting output. If they do it would be reasonable to assume the oil co s share price would rise. Of course if they don't you will go backwards!!
 
BBR said:
May be worth looking at Oil companies. OPEC are meeting on 30 the November to discuss cutting output. If they do it would be reasonable to assume the oil co s share price would rise. Of course if they don't you will go backwards!!
Click to expand...
Of course, if they don't cut output, the value of shares in oil companies are likely to fall as the market will have already priced in what it expects to happen ;)

Oil companies have been on a bit of a good run in the last few months as the price per barrel has risen from its low earlier in the year. Also the dividend from shell is very good as it is paid in dollars and the pound has fallen due to brexit.
 
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onomatopoeia said:
Of course, if they don't cut output, the value of shares in oil companies are likely to fall as the market will have already priced in what it expects to happen ;)

Oil companies have been on a bit of a good run in the last few months as the price per barrel has risen from its low earlier in the year. Also the dividend from shell is very good as it is paid in dollars and the pound has fallen due to brexit.
Click to expand...

One thing I've learnt in a few years of working with various banks: every single piece of economic information can be interpreted in 2 opposite ways. Yesterday I was photographing bond traders and asked them about the new inflation news - almost exactly half said it would cause yields to rise and the rest said fall.
 
BBR said:
May be worth looking at Oil companies. OPEC are meeting on 30 the November to discuss cutting output. If they do it would be reasonable to assume the oil co s share price would rise. Of course if they don't you will go backwards!!
Click to expand...

... and today's weather forecast ? :)
 
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JonathanRyan said:
Yesterday I was photographing bond traders and asked them about the new inflation news - almost exactly half said it would cause yields to rise and the rest said fall.
Click to expand...
Yes, and exactly half is the correct result. If a majority of them expected yields to rise, there would be more buyers than sellers, so the price would go up, and that would reduce the yields to the point where there is no longer a majority view.

Always remember that whenever an "expert" tells you that the price of some tradeable financial asset *is* going to rise or fall, that's always just their opinion. Everything the market knows about the future value of the asset is already in the current price.
 
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JonathanRyan said:
Darts. You wants darts. And a monkey.

Seriously, I follow this book to the letter when investing my own pension fund.

https://www.amazon.co.uk/Monkey-Pin...=1476122577&sr=1-1&keywords=monkey+with+a+pin

BTW I recently came 3rd in a "predict the world cup football scores" comp by simply putting 2-1 for every game - all but 2 of the chaps spending days agonising over fixtures and players did worse than me ;). It's remarkable how often emotion gets in the way of predicting real world events.
Click to expand...
That's a good attitude.

Stock picking and market timing does not work. Every reputable scientific economic publication about these topics will tell you so. The reasons why actively managed funds still dominate the market: fees. Other than that they are a complete pile of horse manure.

How long is the challenge? If it's reasonably long, you might be able to build a diversified buy and hold portfolio.
 
Cistron said:
That's a good attitude.

Stock picking and market timing does not work. Every reputable scientific economic publication about these topics will tell you so. The reasons why actively managed funds still dominate the market: fees. Other than that they are a complete pile of horse manure.

How long is the challenge? If it's reasonably long, you might be able to build a diversified buy and hold portfolio.
Click to expand...


Round One – 17 October 2016 to 27 January 201
 
kennysarmy said:
Round One – 17 October 2016 to 27 January 201
Click to expand...
Oh that's very short. I don't think there is a backed up strategy for such short term investments. Except high frequency trading, but that's actually cheating.
 
For High risk/reward look more to emerging markets, for low risk/reward, the big banks/oil companies/pharmaceuticals tend to be the best bet, alternatively look for a mixture of both and hope for good timing and even better luck!
 
Andrew Mclean said:
For High risk/reward look more to emerging markets, for low risk/reward, the big banks/oil companies/pharmaceuticals tend to be the best bet, alternatively look for a mixture of both and hope for good timing and even better luck!
Click to expand...
You can always do high risk oil and buy something like RKH , that really is like betting on a 200-1 outsider in the grand national, except with less expectation of a profit :D
 
Interesting - keep us updated

I have been "retired" for over 20 years and spend quite a lot of time each day looking at "my screen" ........ I was in "finance" all my working life, so I am "supposed" to know something about what i am doing, but I doubt it most of the time ..... I have followed the markets since the late 60's ........ and part of my retirement "income" comes from the investments that I have made over the years.

You investment period is very short, (until 27/01/17), so to win you are investing for capital gains, short term price movements - i.e. 1, 2, 3 month periods; you may, (will) have to be really active, (i.e. watch your investments throughout the day each day), to make and not to loose money.

You are looking to make substantial capital gains, not income, which is never easy, or every one would be doing it, (a lot of people are trying)

have a plan for each of your holdings, know why you bought that stock, considering your trading objectives, and what you expected from that stock, i.e. the best possible capital gains in your investment period ...... if it does not achieve what you expected, trade ............... don't have a "fuzzy" investment strategy ..... and just sit around the table wondering why you bought a particular stock

Stocks are very volatile and just because the market goes up or down by say 0.5% each day does not mean that there will not be significant movements in individual share prices, just look at what has happened to Tesco over the past few weeks since it hit it's low, (up 25%), and the performance of the Banks over a similar period, (up 20%), Rio T has increased by almost 20% in the last few weeks and the mining "dud" Anglo American by 50% over the summer.

I bought two shares a couple of months ago, because I thought that they would fly and I could get out after a couple of weeks, Polymetals, (down 20% since I bought the stock) and Centamin, (up 1%) - both have released good productions figures, but Polymetal fell 15% when 2 of the major shareholders sold ........

What would be interesting to know is why your group have bought the stocks that it has bought and the reasons why you expect then to perform exceptionally well by 27 Jan

Good luck, you will need it


  • Teams can only hold a maximum of 0.25% of the total shares available in one company
so your maximum investment in one company is only £2,500? ................. it is going to be "bloody" hard work then

BUT
  • The maximum a team can invest in a company’ shares is 20% of the total value of their portfolio
seem to be contradictory
 
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BillN_33 said:
Interesting - keep us updated

I have been "retired" for over 20 years and spend quite a lot of time each day looking at "my screen" ........ I was in "finance" all my working life, so I am "supposed" to know something about what i am doing, but I doubt it most of the time ..... I have followed the markets since the late 60's ........ and part of my retirement "income" comes from the investments that I have made over the years.

You investment period is very short, (until 27/01/17), so to win you are investing for capital gains, short term price movements - i.e. 1, 2, 3 month periods; you may, (will) have to be really active, (i.e. watch your investments throughout the day each day), to make and not to loose money.

You are looking to make substantial capital gains, not income, which is never easy, or every one would be doing it, (a lot of people are trying)

have a plan for each of your holdings, know why you bought that stock, considering your trading objectives, and what you expected from that stock, i.e. the best possible capital gains in your investment period ...... if it does not achieve what you expected, trade ............... don't have a "fuzzy" investment strategy ..... and just sit around the table wondering why you bought a particular stock

Stocks are very volatile and just because the market goes up or down by say 0.5% each day does not mean that there will not be significant movements in individual share prices, just look at what has happened to Tesco over the past few weeks since it hit it's low, (up 25%), and the performance of the Banks over a similar period, (up 20%), Rio T has increased by almost 20% in the last few weeks and the mining "dud" Anglo American by 50% over the summer.

I bought two shares a couple of months ago, because I thought that they would fly and I could get out after a couple of weeks, Polymetals, (down 20% since I bought the stock) and Centamin, (up 1%) - bought have released good productions figures, but Polymetal fell 15% when 2 of the major shareholders sold ........

What would be interesting to know is why your group have bought the stocks that it has bought and the reasons why you expect then to perform exceptionally well by 27 Jan

Good luck, you will need it


  • Teams can only hold a maximum of 0.25% of the total shares available in one company
so your maximum investment in one company is only £2,500? ................. it is going to be "bloody" hard work then

BUT
  • The maximum a team can invest in a company’ shares is 20% of the total value of their portfolio
seem to be contradictory
Click to expand...

I don't think that last bullet point is correct - I've re-checked the rules on the website and they state:

  1. On a per portfolio basis, each team can own a maximum of 0.01% of the available shares in any one company or ETF.
  2. On a per portfolio basis, the sum of all teams taking part in the challenge can own a maximum of 0.5% of the available shares in any one company or ETF. If 0.5% of a company/ETF is already in the ownership of teams taking part in the challenge then no further purchases of stock in that company/ETF will be possible by any team until such a time as some stock is sold by teams that currently hold said stock.
So think the email that was sent to me was wrong!
 
I may also be wrong in my interpretation

  • Teams can only hold a maximum of 0.25% of the total shares available in one company
presumably that means that each individual team can only hold a maximum of 0.25% of the total number of shares that are issued in that particular company

so you need to check the "Issued" Share Capital in each case ............... that's a strange rule
 
BillN_33 said:
I may also be wrong in my interpretation

  • Teams can only hold a maximum of 0.25% of the total shares available in one company
presumably that means that each individual team can only hold a maximum of 0.25% of the total number of shares that are issued in that particular company

so you need to check the "Issued" Share Capital in each case ............... that's a strange rule
Click to expand...
Perhaps not so really strange. Here are a couple of the other rules:
kennysarmy said:
I've got a virtual £100,000 to invest.
...
The maximum a team can invest in a company’ shares is 20% of the total value of their portfolio
Click to expand...
So the maximum investment in any one share is £20,000 (or a little more if the total portfolio grows a little). If this is no more than 0.25% of the issued share capital, that means the company must have a market capitalisation of at least £8 million. If you want to invest £10,000 in a company, you can only do it if the company has a market capitalisation of at least £4 million and so on. I think the rule is intended to prevent people making big punts on tiny companies.
 
I guess there are no trade fees or taxes charged in this game, are there?
 
Cistron said:
I guess there are no trade fees or taxes charged in this game, are there?
Click to expand...
  1. When a team buys stock from the 'FTSE 100' or 'SmallCap 50' they will be charged stamp duty reserve tax and flat rate commission.
  2. When a team buys stock in an ETF they will be charged flat rate commission.
  3. When a team sells stock of any type (including ETFs) they will be charged flat rate commission
 
Yep, fun times with the markets. Good move with the gold. (y)
 
Today was a good day to be holding British Aerospace, up 6.75%. For some reason munitions suddenly got very popular!
 
Checked your baesystems* holding lately? :eek:

*formerly known as british arerospace.
 
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