Active Investor


Overseas Markets Report - 10 December, 2007

 Index  Close  % Change  AUREUS Risk Status  Short Term Trend  Long Term Trend  Index  Close  % Change  AUREUS Risk Status  Short Term Trend  Long Term Trend
 Int-Index   17502.2   1.72%   LOW - Neutral   Up   Down  Dax   7994   1.57%   LOW - Neutral   Up   Down
 Dow Jones   13625.5   1.90%   LOW - Neutral   Up   Down  Cac-40   5718.7   0.85%   Neutral - HIGH   Up   Down
 S&P 500   1504.6   1.59%   LOW - Neutral   Up   Down  Nikkei   15956.3   1.76%   HIGH   Up   Down
 Nasdaq   2706.1   1.70%   LOW   Up   Up  Hang Seng   28842.4   0.69%   LOW   Up   Up
 FT 100   6554.9   1.90%   LOW - Neutral   Up   Down  SSE-All   5342.9   4.51%   LOW - Neutral   Up   Down



Commodities

 Index  Close  % Change  AUREUS Risk Status  Short Term Trend  Long Term Trend  Index  Close  % Change  AUREUS Risk Status  Short Term Trend  Iong Term Trend
 Brent Oil   88.32   -3.34%            CRB Index   342.9   0.91%   LOW - Neutral   Down   Up
 Phil G&S   174.3   1.93%   LOW - Neutral   Down   Up  Gold-$   795.1   1.43%   LOW - Neutral   Down   Up
 Plat-$   1452   1.18%   LOW - Neutral   Down   Up  Silv-$   14.34   2.65%   LOW - Neutral   Down   Up
 FX-$-AUD   0.8758   -0.91%   LOW - Neutral   Down   Up  FX-$-EUR   1.4661   0.16%   LOW - Neutral   Down   Up

There is a lot more green in the Active Investor tables this week, however, the AUREUS Long Term Trends are still Down on most indices. The AUREUS Risk assessment is more positive, moving to LOW-Neutral for most because the AUREUS Short Term swing is Up for all the international indices.

There is a stark contrast between the equity indices and the commodities. Note that the Short Term Trends for all the entries in the Commodities table are Down whereas they are all Up for the equities indices.

The USA, European and Asian markets all had a positive week and may be a little stretched in the short term. This coming week will be a telling one. The S&P500 made a lower high and lower low on the daily charts in November but has made a higher high in December. To change the Long Term Trend to Up this short term up swing will need to continue making higher lows and higher highs until breaking through 1553 again. The S40 is still heading lower and the S200 is hanging in there, rising ever so slightly. The SIROC is rising on the daily chart below but hasn't quite turned yet on the weekly chart (not shown) confirming that the S&P500 is still in a medium term down trend.

On the down side, if the S&P500 moves lower over the next week or two, the lower support trend line must hold otherwise these markets will head lower.

 

Local Market Report

 Index  Close  % Change  AUREUS Risk Status  Short Term Trend  Long Term Trend
 All-Ords   6714   1.83%   LOW   Up   Up
 Info Tech   590.5   -0.82%   LOW - Neutral   Up   Down
 Cons. Disc   2783   1.81%   LOW - Neutral   Up   Down
 Materials   15777.5   1.08%   LOW   Up   Up
 Energy   15705.3   2.16%   LOW   Up   Up
 Property Trusts   2407.2   4.95%   Neutral   Up   Down
 Financials   7210   2.45%   LOW   Up   Up
 Staples   9193.5   1.73%   LOW   Up   Up
 Health   9640.9   2.76%   LOW   Up   Up
 Telecom   1681.9   1.06%   LOW - Neutral   Down   Up
 Industrials   7065.6   1.25%   LOW   Up   Up
 Utilities   6924.9   2.53%   HIGH   Up   Down

The ALL-ORDS has bounced nicely over the last two weeks with all sectors bar the Info Tech rising over the last week. All sectors are in AUREUS Short Term Up trends except Telecommunications. The Health Sector went Low Risk on Friday 7/12/2007 using the SPA3 Risk assessment rules (not seen in the Active Investor).

The ALL-ORDS has risen above the median trend line and S40 (40 day simple moving average) in the chart below. The daily SIROC is rising as is the weekly SIROC (not seen in the Active Investor) but has not yet crossed over its moving average which will signal a Low Risk medium term market. Another positive week and that cross over should occur.

For this market to continue to rise I would like to see the ALL-ORDS hold the median line (dotted red) on any weakness and the S40 to turn up. The S200 continues to rise.

 

Portfolio Summary

Portfolio 23/11/2007  30/11/2007  07/12/2007  Weekly Move % Top Mover % Gain Transactions % Invested Market Risk
AUREUS $405,023.90  $409,533.57  $419,149.94  2.35%  AUSTLAND  8.79%  0  100.00%   
SPA 1 $457,947.59  $464,894.10  $471,237.09  1.36%  DISCOVMET  34.78%  3  67.10%   
SPA 2 $158,524.33  $155,922.29  $156,155.98  0.15%  COCKACOAL  13.21%  4  69.35%   

Compounded Annual Return
Portfolio 1 Year 3 Year 5 Year
AUREUS N/A  N/A   N/A  
SPA 1 41.13%  31.62%  29.36% 
SPA 2 32.84%  N/A N/A 
All-Ords 23.11%  19.24%  17.56% 
All-Ords Accum Index 27.65%  24.05%  22.35% 

 

All actions each day for the SPA 1 and SPA 2 portfolios are available to Share Wealth Systems members who use Market Master through our daily download software along with the actual public portfolio files for importing into the SPA software.

AUREUS and SPA Buy Signals

The table below shows the number of AUREUS and SPA Buy signals for the past three weeks.

Methodology 23/11/2007  30/11/2007  07/12/2007 
AUREUS 3  0  0 
SPA* 49  27  38 

*Our scan includes stocks that have had four zero trading days unless it is a suspension. Before entering we ensure that the position size calculated has at least 5 times the average daily traded volume for that stock.

The table below shows a sample of some of the AUREUS and SPA buys that occurred last week.

Share
Methodology Share
Methodology
CARNEGIE  SPA  QLD-GASCO  SPA 
STRAITS-R  SPA  TASSALINT  SPA 
GRYPHON  SPA  IDT-AUST  SPA 
MT_GIBSON  SPA  EQUIGOLD  SPA 
       

 

For SPA buys, a complete list is available to SPA customers by using the 'SPA Scan' under the 'SPA' pull down menu in Market Master X-ec. For AUREUS buys, a complete list is available to AUREUS customers in the Members Zone by choosing 'AUREUS', 'Alerts'.
 

SPA Signal of the week

WPG (Westplain) is the SPA3 'trade of the week' for this Active Investor issue.

A WCB2 signal occurred on Friday 7/12/07 to enter on Monday 10/12/07. WPG has averaged a daily turnover of $478,000 over the last 3 months. Volatility is 3.52% and market cap is $111M. WPG is a Metals & Mining stock that is in the Materials GICS sector.

 

 

Gary's Comments

Whilst the tables and charts are looking a lot better than they did two weeks ago, further positive price action is required to confirm that the markets are in medium-term up trends again. Certainly, the necessary short-term price movements have occurred as the first step but more is required before maximising exposure to the market for medium-term trading.

This e-Newsletter does NOT concern itself with the reasons behind the up and down movements in the markets - just what the objective assessment of the long-term and medium-term statuses are from our two mechanical systems, AUREUS and SPA3. Both AUREUS and SPA3 only look at price action in the markets to determine risk and direction.

So, watch the next week or two with interest to see if the S&P500 can rise above 1553 and the ALL-ORDS above 6873. December and January are typically positive months in the markets but not this year so far. Can the markets catch some of their typical Christmas and New Year cheer this year?

 

 

Share Wealth Systems provides more detail on all of the above items at our eUGMS. The eUGMs are monthly multimedia presentations available to Share Wealth Systems members only. 

 
Issued by Share Wealth Systems . ABN 46 066 441 405. FSR Licence No. 250900. This email is published as general information and should not be construed as advice without consulting a registered financial planner or fully considering the risks involved and your own financial position. It does not take into account the investment objectives, financial situation and needs of any particular person. Share Wealth Systems accepts no liability for any loss or damage that may be suffered by any person, directly or indirectly through relying upon any information or statement in this newsletter. The securities recommended carry no guarantee with respect to return of capital or the market value of those securities. There are general risks associated with any investment in securities. Investors should be aware that these risks might result in loss of income and capital invested.