Pilkington Trading Performance Page

Hi All,

A quick note publishing the establishment of the Performance page on the website.

The page will be kept up to date on a constant basis with the strategies and trades entered and the performance related to them.

The spreadsheet that is downloadable from the page will cover the details and performance of:

• Issued Trade Alerts – all issued since 2012
• High Yield Income Strategy (AUS) – all trades entered since joining Gleneagle Securities (March 2015)
• High Yield Income Strategy (US) – all trades entered since joining Gleneagle Securities (March 2015)
• Conservative Income Strategy (Dow Jones – US) – ongoing return since December 2013 as well as 2014 Calendar Year Performance.

Let me know if you have any questions pertaining to this publication or if you would like to find out more about myself, my investment services, Gleneagle Securities or anything else.

LP

*Change to Profit Taking Level – VISA

I issued a take profit alert on Visa on the 21^st July to take profits on this open trade alert with a limit price of $9.30. The stock fell away in the sessions that followed this release and the limit price set was not filled. Overnight, Visa reported an increase in profit for the third quarter and the stock has rallied in the after hours trading session. The stock has traded up $ or xx% in after hours trade.

I am revising the limit order set on the take profit alert. Please see full report below:

V Change Take Profit 24.7.15

I’d buy now…

Looking through my list of preferred US Equity names, I wanted to pick a stock per sector that is still worth buying. Here’s the list:

• FREEPORT MCMORAN
• MORGAN STANLEY
• TYSON
• VIACOM
• HALLIBURTON
• IBM
• LINKEDIN
• ROCKWELL
• ALIBABA.
• COACH INC.

In other spaces:

• Buy USD – Sell EUR, JPY against it.
• Take profits on Oil trades for possible entry at lower prices in the near term.
• Buy Volatility Index ETF – Sell in May and go away! Volatility index is inverse to Equity markets as you can see below. The S&P 500 (black) and VIX Index (orange) chart represents the correlation. With the market failing to break new highs convincingly, I think we may see a sell off in the near term = VIX index UP.

• Buy ASX200 CFD or SPI Futures Contract/s on short term move back to 5750/5800.

LP

Trade Alert – Buy USD/CNH (US Dollar/Chinese Yuan Renminbi)

	BBY Trade Alert – 29 January 2015 BBY Technical Idea
Open Trade Alert Buy USD/CNH at market (6.2450)
Entry 6.2450 Stop Loss 6.2100 Take Profit 6.7500 Commentary With global interest rates pushing toward zero bounds the world’s central banks have resorted to a race to ‘competitively devalue’ their own currencies. These moves are an effort to stimulate economies that have run out capacity to cut interest rates.  A number of markets observers have labelled the phenomenon “Currency Wars’. We saw the ‘benign neglect’ of the previous ‘strong dollar’ (USD)  policy by the United States back at the start of the century which accelerated after the GFC. We’ve seen it probably most visibly in Japan as the Abe government made currency weakness a central pillar of their policy, and with good effect too as the USD/JPY has risen from 75 to 120 since late 2012. But it is also happening in the ECB’s Europe, in Denmark too whilst Switzerland tried, but ultimately failed. And just today we have seen Singapore unexpectedly move to weaken the SGD by adjusting the official trading band higher. That leads us to the belief that China will be one of the next cabs off the rank in terms of being happy to see their currency fall. For the last 7 years China has allowed the yuan to rise given their incredible growth rate, export performance the ensuing trade surplus (and pressure from the USA who were labelling them currency manipulators for keeping the yuan too weak). Things are changing however. China’s growth is slowing (with some risk of a property bubble meltdown)  and easing measures have recently been implemented – with more likely to come – so a softer Yuan would no doubt help China right now. Competing with China,  Japan has been given a huge advantage with a boost in its export competitiveness via the massive Yen depreciation of the last 2 years, a move China must envy. Lastly, trying to invest in China has been the theme of this century which makes the trade very crowded. If that trade has cause to be unwound the move higher in this pair could be explosive! To implement this strategy, please call Luke Pilkington on 03 8660 7260 or ltp@bby.com.au

Morning Brief 22/1/15

Bank of Canada cut Rates – The highly regarded Bank of Canada cut rates last night by 25bps in an effort to beat off disinflationary forces and the negative economic impact of the sharp drop in oil. The so-called “loonie” dropped sharply. The AUD followed suit (see chart below). Given the very compressed trading range the AUD has been in over the past 5 sessions, this places significant pressure on the AUD to break below the critical USD0.80 mark. Why is this critical? Because it’s where the AUD stopped on its march higher post GFC and also where it stopped in its tracks during the 2010 sell-off. I’ve been waiting for this level to be broken before getting too aggressive on further downside, but if this breaks USD0.70 looks like the next level to aim for.

Action point:

Short the AUD below USD0.80; and

1. If you haven’t already, BUY the global earners stocks or the stocks that benefit from a lower AUD. Below is a table showing the global earning industrials. BBY does not cover either, and the consensus recommendation is underperform on both on valuation grounds. Yet, my two favourites are COH and RMD because they have the best relative strength charts of the group – so they continue to outperform the market.
2. Buy-write over stocks with high volatility and selling vol makes sense. List of buy write candidates is below.

Trending FX Service

I will be commencing my coverage of a Foreign Exchange trading strategy that is strictly rule driven from technical analysis and indicators. The strategy is based on the concept of what is known as ‘Parabolic Stop and Reverse’ which essentially is a trend based trading strategy.

I will be releasing a daily note of the Forex positions I currently hold and the stop loss levels that will be updated in the day on a daily basis based on the movements of the currency pair the night before.

The strategy has proven successful in the past through back testing. This strategy requires patience and the ability to stock to the rules! If you believe you can follow these two things, there is a good chance that you can see some decent returns.

This is a chart that the strategy is based off where we either get given ‘Buy’ or ‘Sell signals based on the red dots. If the dot is below the candle, we buy the currency and place our stop loss at the level of the red dot beneath it. On a daily basis the stop is moved to the dot below the corresponding candle. In this case we would buy AUDNZD and set our stop loss at the level of the red dot below the latest candle.

In foreign exchange profits and losses are calculated in points. Foreign exchange is has a margin rate of 1%, meaning that if you want exposure to $100,000 of a currency you will have to put aside $1,000 of margin in your trading account.

P/L e.g: If the AUDUSD moves from 0.9000 to 0.9010 for example, this is a move of 10 points and this would constitute a profit or loss of $100.00 on a $100,000 position.

These are my current positions and equivalent information if all trades were followed:

• AUD/USD (Daily) Latest 0.9033         LONG from 0.9113 on 18/03       Reversal point at 0.8963.
• 1045 points realised profit since 01/13 if all trades followed.

• EUR/USD (Daily) Latest 1.3778          SHORT from 1.3866 on 19/03     Reversal point at 1.3938.
• 294 points realised profit since 01/13 if all trades followed.

• EUR/JPY (4 hour) Latest 141.110       LONG from 141.760 on 20/03     Reversal point at 140.830.
• 3434 points realised profit since 01/13 if all trades followed.

• GBP/USD (Daily) Latest 1.6506          SHORT from 1.6597 on 12/03     Reversal point at 1.6666.
• 1326 points realised profit since 01/13 if all trades followed.

• USD/CAD (Daily) Latest 1.1243          LONG from 1.1118 on 10/03        Reversal point at 1.1098.
• 1110 points realised profit since 01/13 if all trades followed.

• USD/JPY (Daily) Latest 102.400         SHORT from 102.320 on 13/03    Reversal point at 102.590.
• 1095 points realised loss since 01/13 if all trades followed.

If all trades were followed from 01/2013 last year the total profit would be 6114 points.

If we held a $100,000 position in each of these pairs this would relate to a $61,140.00 profit.

Remember only $5,000 margin would be needed for this. I would recommend an account size of $20,000 to take up positions this size so we were able to ride the ups and downs of the currency market. Of course we could do this with $10,000 positions and the margin necessary would only be $500.00. I would recommend an account size of $2500 in this case.

Please contact me to look into establishing an account and following this strategy if you are interested.

LP