SCT Chart

[Snoopy]

quote:Originally posted by Phaedrus

"That rather shoots down Phaedrus's theory on the big boys and the smart money getting out of SCT!"
Snoopy, it is very naughty of you to say such a thing - re-read this thread and you will find that I have NEVER MENTIONED the "big boys" or "smart money" as getting out of SCT. The current downtrend in the OBV (as plotted at the top of the latest chart) does show that the general public is getting out, though.

I don't wish to get involved in a fruitless argument Phaedrus. I will concede that you never used that exact phrasing. However, let's examine what you actually said.

quote:
Take a look at the craftily inserted short-term plot of the On Balance Volume indicator. For about a month now, while the price has been rising, the OBV has been falling. (Volume has been higher on down days than up days). Distribution has been taking place as bigger holders exit this stock.

'bigger holders exit this stock'

vs

'big boys getting out of SCT'

In other threads you have certainly referred to the larger institutional holders being 'smart money' (or an equivalent term).

I put it to you that while the point you make is technically correct, it is also semantic. I'm not trying to points score here. If your phrase 'bigger holders exit this stock' implies something different to 'big boys getting out of SCT' then please enlighten me, as I want to understand the message you were trying to convey.

All I'm saying is that, as of this moment, *I* can't see any effective difference in the meaning between.

'bigger holders exit this stock' vs 'big boys getting out of SCT'

But I'm prepared to be educated.

SNOOPY

[Snoopy]

quote:Originally posted by duncan macgregor

SNOOPY, SCT is a very easy share to predict. Nov, dec is where all the large movements in sp eventuated. We have had plenty of lets say hints that instead of a rise in sp this time a fall was looming.

I think a share price fall was likely, agreed, because the longer the dollar is hanging 'up there' the longer exporters are doing it tough.
However, you are working on the assumption that when the dollar turns there will be plenty of investors willing to sell their SCT shares to you at cheap prices. I think you will be surprised how quickly SCT rises when the dollar turns. That's what happens with thinly traded shares.

quote:
the smart investor should have been out of this twelve months ago at over $3 if they had any sell system going at all.

Is this the same smart investor that was predicting a big fall in the kiwi dollar twelve months ago?

quote:
I will venture the prediction that your averaging down to buy more at $1-91 is still too high.

Perhaps. I don't count myself as a timing genius. But IMO $1.91 is cheap enough, for the fundamental reasons I have already explained. I'm not worried if someone else gets a slightly cheaper deal. But IMO it is just too risky to asume it will get much cheaper.

Oh and BTW I am not averaging down, I am averaging up. My historic adjusted average purchase price for SCT is below $1.91.

quote:
The fundamentals read this way. The NZ dollar will take time to retrace,

Yes

quote:
the business that SCT are in is highly competitive.

No, I disagree. There are only two or three companies globally that can do what Scott's do. Scott's business is competitive (what business isn't, apart from AIA but it is not 'highly competitive'.

quote:
the market in general is destined to track down,

It could do. But I just leave Mr Market to do his own thing. I don't worry about what he does as I can afford to wait out any periods of irrational pessimism.

quote:
they will get more than their share of negativity.

Have to disagree with that. The more negativity surrounding a share the *less* it falls when the market trends down. Look at RBD, strike ridden and seemingly swimming in negative sentiment. It has been completely untouched by the market downturn last week. In case you haven't noticed SCT has already fallen a long way as well.

In addition, rising interest rates will have no effect on SCT, as it has no term debt at all.

In summary, I'd say you're dead wrong.

[quote]quote:
The golden macdunk rule is never buy anything on a

[Phaedrus]

Snoopy,
Here is a quote from the "NOG/NOGOC Charts" thread :-

"...... the theory is that the smart money is the big money and when it buys or sells there is a [u]spike in the OBV.</u> A good example of this is shown here :- http://h1.ripway.com/Phaedrus/MCH128001.gif
The more gentle overall trends are the public moving into or out of the stock. A bit simplistic to be sure, but it gives a little more insight into the market."

PS A few of my charts including the MCH link as above, are being reproduced rather oddly at the moment - maybe there is some (hopefully temporary) problem with the webspace provider that I use.

[Snoopy]

quote:Originally posted by Phaedrus

Snoopy,
Here is a quote from the "NOG/NOGOC Charts" thread :-

"...... the theory is that the smart money is the big money and when it buys or sells there is a [u]spike in the OBV.</u> A good example of this is shown here :- http://h1.ripway.com/Phaedrus/MCH128001.gif
The more gentle overall trends are the public moving into or out of the stock. A bit simplistic to be sure, but it gives a little more insight into the market."

OK Phaedrus, thanks for the clarification.

It is true that Chairman Marsh, as a director of Silveracres (the largest shareholder in SCT) would likely be judged as 'smart'. But the number of shares he has bought in the last month, in relation to his total associated holding in SCT, is small.

What we have here is a 'smart' man doing something inconsequential in the greater meaning of things. Nevertheless my interpretation of what Marsh is doing is that he is sending a signal to the market. Namely, that SCT shares are too cheap from a long term investing standpoint.

I put my own buy order in long before Marsh started buying shares in 2005. I came to my own conclusion as to what SCT shares were worth, independent of Marsh. Nevertheless I took comfort from the fact that when Marsh bought his shares, he paid more than I did.

Either way, I guess what Marsh is doing doesn't rate on the OBV scale? But on the confidence scale, I think it is significant.

SNOOPY

[duncan macgregor]

When I read this thread from start to finish it makes me look at Investment styles, see who said what, who did that. We all agreed that SCT was a good company, the difference being some people fell in love with the company, and others sold out. The ones that fell in love bought more before it bottomed incase they missed a bargain. That to me is financial suicide. The ones that sold out can buy back If It turns the corner at the bottom and end up with nearly double the ammount with the same money. Who is right and who is wrong is easy to see now that we look at it in hindesight. The next sharemarket crash, yes sooner or later we will have one read this thread from start to finish to see who the big time losers will be, and who will have their money out of It. macdunk

[Snoopy]

quote:Originally posted by duncan macgregor

When I read this thread from start to finish it makes me look at Investment styles, see who said what, who did that. We all agreed that SCT was a good company, the difference being some people fell in love with the company, and others sold out. The ones that fell in love bought more before it bottomed in case they missed a bargain. That to me is financial suicide. The ones that sold out can buy back If It turns the corner at the bottom and end up with nearly double the amount with the same money. Who is right and who is wrong is easy to see now that we look at it in hindesight. The next sharemarket crash, yes sooner or later we will have one read this thread from start to finish to see who the big time losers will be, and who will have their money out of It. macdunk

I know he is quite capable of defending himself Macdunk, but I just had to rise to the defence of my old sparring partner Phaedrus after such an unwarranted verbal tirade.

Just because Phaedrus didn't have a specific valuation target or even a rough valuation range in mind (or at least hasn't shared that with us on Sharetrader) for SCT doesn't mean he 'fell in love' with it. From what I have seen Phaedrus is very disciplined about the way he goes about investing.

I agree that Phaedrus is very set in his ways about things like 'selling at the trendline break' no matter what the fundamentals, but if it works for him, does that really matter?

It is also not fair to glibly say that 'the ones who sold out can buy back' when Phaedrus has already shared with us the agony of seeing SCT change from being his best performing investment to his worst *before* he was finally able to sell out. You just know that liquidity in SCT shares hasn't improved since that time. And that should Phaedrus decide to re-enter the share, he will not be able to buy all the shares he wants at the low prices he seeks. You are well aware that just because someone buys a couple of thousand SCT shares at some sweet spot which happens to co-incide with the daily closing price, *doesn't* mean it is easy for even that same person to buy ten times that number of shares at the same price. And if such a desired purchase is impossible for the 'grand master', what does it say for the chances of those disciples that follow on the coat tails of his strategy?

I am sure that Phaedrus will cope all right with having more and more of his portfolio money in the bank. Even if his income on invested capital has dropped to only two thirds of mine because he doesn't seek out good dividend paying shares. His strategy may not be optimal, but to call it 'financial suicide' is going too far.

And finally, judging an investment performance with hindsight only works if the market is deterministic. Clearly if you, or even Phaedrus, had such 'certainty of the future insight' you wouldn't be lulling around on this forum. You'd be swanning around on your own tropical island fighting off the attention of the army of personal masseurs while you decide which cocktail to sip next! So let's get back top some reality here. Phaedrus's escape from the cliff edge, does not prove that those that adopted the same strategy, yet still ended up at the bottom of the ravine, were right.

SNOOPY

[duncan macgregor]

SNOOPY, You are twisting words I look on PHEADRUS as having an excellant sell strategy. It is much better to have your money in the bank as watch it down trend in a company. I feel sure that PHEADRUS is smart enough to find a company on an uptrend to invest in. His charts and comments were right on the nail looking back on this thread. MACDUNK

[k1w1]

Macdunk, I must agree with SNOOPY that you have been far to harsh on Phaedrus. Although he fell in love with this share as it turned from his best to his worst he still did eventually part with it.As I am sure you have with Trustpower...

[duncan macgregor]

KIWI

quote:Originally posted by k1w1

Agreed, MacDunk

*gasp. goes off to take his temperature as may have been stricken by a strange illness*

Bet you feel a lot sicker now my old mate that you didnt listen to old macdunk and his time line or PHEADRUS and his sell signals. Bringing up TPW in a desperate attempt to cover you being so silly is the bottom of the barrel stuff. pals for life macdunk

[k1w1]

Ah Macdunk, the laird of evasive answering, I'll take that as a negative on your sale of TPW despite it breaking through the lines of your system.

I should perhaps disclose that SCT is a miniscule part of my portfolio having purchased a small parcel on a buy and hold basis so long ago I remain significantly under the current SP. Like Snoopy I would have to average up to purchase at current levels.

If I hold for 10 years the dividends I receive will probably return my purchase price without having to sell the shares. Having held AIA and CEN since issue it is quite likely this will occur. The major risk is that SCT may go belly up.As I have received dividends and extra shares I am prepared to run that risk.

I could sell, the brokerage on the way in and out, on such a small holding would mean I would have to be on a far better thing which on a short term basis I am not always able to determine ( I purchased VCT for instance, like AIA and CEN it has not immediately risen).

Or I would hold in cash paying a third of the interest to Helen Clark. Then I would also have to be able to get in on a rise, and I may or may not time that without missing out on a significant percentage.

In this particular case I will sit out the dance thankyou.Feel free however to keep performing your trustpower jigs and victory flings, its quite entertaining.

Your mate

K1W1