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Delta index trading presentation

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Delta index trading presentation

  1. 1. Famous Last Words<br />Paul Sommerville<br />Delta Index Ltd.<br />24th June 2010<br />
  2. 2. Famous Last Words:<br />Don’t be an idiot, who else would use the fast lane in this fog?<br />Of course it isn’t loaded................<br />Right, hold my coat...................<br />Tell me when I’m getting near the edge............<br />Now let me see – brown neutral, blue live................<br />Don’t worry; I know how to tie a rope properly..............<br />Listen, I drive better after a few drinks.................................<br />Its years since I’ve ridden one of these yokes...................<br />
  3. 3. Famous Words in the Financial World:<br />The worst is over<br />Sure nobody could have seen this coming<br />Always diversify<br />China is going to be big!<br />Just like the Internet was going to be big, just like property is the only safe investment, commodities were going to be big<br />Solar energy is a great investment !<br />It’s a great day to buy stocks –they look undervalued<br />
  4. 4. Human Nature<br />I’m really unlucky at trading, the minute I buy something it seems to go down.<br />In fact I’m just an unlucky person.<br />The market is a lottery sure nobody can make head nor tail of it.<br />I like to buy things and when they go up I sell them. If they don’t go up I buy more, sure they’re bound to go up eventually!<br />My stockbroker tells me the buy and hold strategy is the best.<br />Warren Buffet agrees!<br />I prefer to leave it to the experts.<br />
  5. 5. Rule No. 1<br />The first rule about making money;<br />STOP LOSING MONEY<br />
  6. 6. Anglo Irish Bank 2007 to Bust<br />
  7. 7. Bank of Ireland 2007 to Present<br />
  8. 8. Bank of Ireland2010<br />“Buy”<br />Target: 1.50<br />“Buy”<br />Target: 1.20<br />“Buy”<br />Target: 0.90<br />“Buy”<br />Target 1.95<br />“Buy”<br />Target: 1.70<br />
  9. 9. What We SaidSunday Times - 14 Sept 2008<br />
  10. 10. Rule No. 2<br />Discipline<br />Totally lacking in investment<br />Overtrading<br />Where are the stops?<br />Using a buy and hold strategy with leverage in a bear market – lethal<br />The market does not always go up<br />Nikkei Chart<br />Dow Chart<br />
  11. 11. Rule No. 3<br />Know where you are getting out, <br />BEFORE you get in<br />
  12. 12. Rule No. 4<br />The market is a forward pricing mechanism<br />Learn this rule.....this is all you need to know!<br />
  13. 13. CRHFeb – Aug 23rd<br />In line with guidance provided in the January trading update <br />
  14. 14. CRH27th July – 7th Sept<br />
  15. 15. Global signs according to Paul<br />Many of the sources of today’s growth are temporary and precarious.<br />The rebuilding of inventories will not boost firms output for long.<br />Across the globe spending is being driven by Government largesse not animal spirits.<br />The world has changed and especially the investment world and it is those who adapt will survive and thrive.<br />
  16. 16. Stimulus packages wearing off<br />A great credit contraction is upon us<br />Recovery hopes pinned on cheap credit but new debt has gone out of style<br />
  17. 17. This is a bear market<br />All bear markets are characterised by despair, followed by misplaced hope, followed by further despair.<br />
  18. 18.
  19. 19. Nikkei 225 1989 - Present<br />
  20. 20. Sentiment Indicators<br />Volume<br />Optimism<br />Momentum<br />Anecdotal<br />Human Psychology<br />
  21. 21. What have we learned?<br />I’m really unlucky at trading- the minute I buy something it seems to go down.<br />No you’re just the last man in.<br />In fact I’m just an unlucky person. <br />No you’re just using your emotions and uninformed broker to make decisions.<br />
  22. 22. What have we learned?<br />The market is a lottery sure nobody can make head nor tail of it.<br />No the market is a forward pricing mechanism, this is the key to everything.<br />I like to buy things and when they go up I sell them. If they don’t go up I buy more, sure they’re bound to go up eventually!<br />A recipe for having a portfolio of dogs.<br />
  23. 23. Berkshire Hathaway 2009<br />
  24. 24. Crude Oil<br />Goldman: Oil heading to $200<br />Goldman: Oil heading below $30<br />
  25. 25. Dollar<br />
  26. 26. Euro/Dollar<br />
  27. 27. Monsanto<br />
  28. 28. LSE:CRH<br />
  29. 29. Nikkei 225 Index Chart - NIK:NI225<br />
  30. 30. Think !<br />If you swim with the crowd you will lose money like the crowd.<br />Last thing to remember is stay away from slow horses and fast women and always ask the question; <br />“Where are all the customers’ yachts?”<br />

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