My spreadbetting adventure

[kimchi]

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as for the portfolio itself, how should i best hedge against the US market falling. would it be too marginal just to short the SP500? as in is it only worth it for a hedge fund with millions doing this, rather than a guy with $2K.

I'm thinking maybe going for 3 commodity futures, 3 non-market based (long on property fund for example), 4 stocks, 2 US, 2 non-US.

so 30% commodities, 30% others, 40% stocks (ideally the stocks section would comprise of about 20 stocks but due to minimumt trading restrictions 4 is realistic, although if this grows then ill introduce more)

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It all sounds pretty muddled, John. Aside from following tips, can you outline your general strategy and risk/trade management?

[Tupacia]

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thanks for all the replies. I fail to see why following tips fails. You are pooling together the research of a number of people and taking the best result (or two) of their research. why would this not work?

For sure the tip will sometimes end out being wrong, but it doesnt mean it wasn't a +EV tip. If you do not put too much emphasis on a one-off tip (i.e. it is only 5% of your portfolio) then I don't see how it can go wrong long term.

So you do not think the average best share advice of a poster on this forum will outperform the market? Based on keeping each share for a set x length of time and each share is equally weighted. If not, fair enough, but I do, and although it is a very small sample, I think the unofficial portfolio helped (maybe effectively reverse implied odds in poker terms) convince me down the tips path.

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Best of luck to you, but if you're after performance you can probably do better than a group of random poker players dishing about the market. If you're after a learning experience, do your own research. I don't really see what leads you to believe that your tips will outperform the market if you know nothing about the methodology the tipsters employ and are only basing your faith in them over a hypothetical portfolio (which is the equivalent of saying "look at this 10 hand sample, I'm an incredible poker player!"). Don't mean to be negative, just don't really understand what your objective is.

[eastbay]

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thanks for all the replies. I fail to see why following tips fails. You are pooling together the research of a number of people and taking the best result (or two) of their research. why would this not work?


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What makes you think tips are the best results of research? In whose best interest is it to give out tips, and for what reason?

eastbay

[john kane]

kimchi - having taken on board the advice, im leaning towards not doing it now. my general strategy would be to leverage as much as possible any companies i heard were going to do well. as for risk management, i'd allow for 15% drop till bust per stock, and try to diversify my holdings so, say a US market crash occurs i wouldnt be wiped out of my portfolio.

i guess the reason i am so opposed to doing my own research is that from reading around, even people who spend 30+ hours doing research get it wrong, so it is futile me spending a few hours a week trying.

i agree eastbay you have to be careful why someone is giving a tip, but i doubt anyone on here thinks by offering a tip it will affect the share price, thus people might as well hope to get braggin rights by their pick doing well.

thanks for the replies, ill def keep this updated.

[Tupacia]

Seems like you're making a smart decision John. If your rationale for not doing your own research is because research doesn't guarantee results, then blindly following tips that are the basis of that research won't be much better.

[john kane]

ah ha, i'm back with this idea again. as ever whenever poker doesnt go well for a few days i look elsewhere for some $$$.

I have paid £90/$180 for a year long investor chronicle subscription which gives daily tips.

My Plan:

I'll deposit probably £5,000 (!). They offer tips for buys and sells. I'll have 10 buys, 6 sells, and 4 'others' (commodities etc).

Each with £250 staked. For the buys and sells I will have a 20% leeway, so that if my buy can fall up to 20%, I lose my £250 (this is manly to protect against a market fall, however hopefully i am kinda hedging this with having a number of shorts). I will be leveraging by 5 times.

I'll do updates on here once it is up and running.

[lambdb]

John:
take a look at www.americanbulls.com
or if you are in the UK take a look at www.Britishbulls.com

Big time chartists but they are good.

lambdb

[john kane]

well, ive started, just £1K till i get the £10K from selling my shares.

Currently:

Short:
BG Group
British Energy Group

I just don't like groups.

Longs:
Genentech
QXL Ricardo

3 are UK, Genentech are US.

I have no idea what any of them do, I have done no research whatsoever.

I've maxed out my £1K at leverages of around 5-8 times depending on stock.

[john kane]

i really would be interested in futhur views on this.

basically:

i will be using britishbulls.com. I then choose their higher rated stocks, 5 of which I short, another 5 I long, therefore, no matter where the index direction goes, I am fully hedged.

Additionally, I will be long of gold, silver, corn and oil.

I will leverage at 7 times approximately. As I am spreadbetting, all profits are tax free.

I genuinely do not see how this can go wrong and how I will not make a decent return.

[ChromePony]

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I genuinely do not see how this can go wrong and how I will not make a decent return.

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I can't say that I know all that much about finance and investing, but mindsets like this just completely baffle me.