I think there may be time lags as well. eg when Royal Mail increased 1st and 2nd stamp prices by some huge amount some years ago, I bought up at least 300 quid of 2nd stamps. even today I am still using those.
so whenever I post letters, they dont make any money from me! the money was made some years ago!
similarly many people posting cards at Christmas will probably be using stamps from further back in time.
presumably people with franking machines could be using such that were bought further back? I dont know how franking machines are done
will the access contracts force them to return these and get new ones??
the access contracts will affect future interims, but not this one.
if I had more funds I would put a long term buy on RMG, its just that most of my money is outside the stock exchange and earns me enough to do all my shopping. I have set aside a limited margin of cash for shares, and so I need to be very discerning where I put the money. I have made a healthy profit on RMG so far, and later may try some short term trading, but I will wait some weeks to see what the new share price behaviour is.
society is based on days, weeks, months, years so these are good to measure progress.
eg shares often start the day low sell and high buy price and end the day with high sell price. Market close on Friday is different from start of following Monday. The end of a month or year is usually bad, its best to do things early in the year or month.
monthly data will detect the upward drift.
but I would recommend to also note the monthly high + low. the high and low are a very powerful way to detect progress or non progress. eg with the pre interim price surge, I knew it was phony because the low never went above 604.5 The price seemed to be getting ever higher, but the low wasnt outdoing a specific value I had selected.
the thing to look for is whether the current low goes above the earlier high, that is very reliable sign of progress. if the current high goes below the earlier low that is a sign of descent.
you need the high and low to catch bad behaviour between the measurement points.
ProRealTime.com give for free the high and low for different time units of a day or larger. intraday ones from them cost money. The data is given as green and red boxes with spikes. The upper and lower edge of the box is the open and close price. The spike gives the low and the high. the box is green if the close price is higher than the open, red for the converse. so if the box is green, the lower edge is the start price.
if you move the mouse over any rectangle it will tell you the open, high, low, close values. from this the months so far have the following low and high values:
oct 330 568.6 nov 528 595 dec 550.5 607 jan 551 618
the lows are more reliable, and are the worst sell prices, the highs are the worst buy prices. from this the percentage gains in the lows are nov +60% dec +4.26% jan +0.09%
the lows are grinding to a halt. also the lows havent yet overtaken initial october high of 568.6
only when monthly low exceeds 568.6 will there have been true progress, can use as buy signal.
a lot can go wrong in a month, so its a good idea to monitor either the daily or weekly high and low, and compare these say with the most recent monthly one. 550.5 is the danger point for the daily or weekly high.
current high + low versus earlier low + high is a very powerful indicator, which is not fooled by phoney surges and phoney corrections.
I prefer to look at the current low versus the maximum daily sell price, but its expensive to subscribe to data which gives that.
from 2009 onwards, the high is overtaken by the low in 2 years. if you bought at the worst time of one year and sold at the worst time of the year 2 years later you will make a profit! GUARANTEED profits if you wait 2 years.
eg SPD made 17.4% profits on the half year, and that evidently is regarded as bad, because the previous annual results were up 43.6%. so 17.4% is regarded as poor!
RMG has nice profits, 570m last year, it has net worth of 1.4 billion. and the trade it does is recession proof, but there is competition within the sector. the enormity of the RMG distribution system will be difficult to challenge especially in a recession.
the badness is just that they arent currently progressing their profits. this is mild badness and the share price is what the market values the circumstance as. no amount of hype can change this, hype can only improve a share price temporarily, it eventually reverts back to true value. Two phenomena can improve this share price: a healthy year on year improvement, or a big dividend. Until that happens no amount of huffing and puffing will push the price up permanently.
there are much worse levels of badness out there,
eg companies that lose huge amounts of money, eg RBS lost 5.8 billion quid in 2012! that equates to losing 15.9 million quid every day. and if I understand rightly their profit after tax for the most recent quarter is a loss of -715 million, eg -250m on PPI. they have a TRILLION pounds of liabilities, luckily they have 1.1trillion of assets. but 323 billion of this is derivatives, and one wonders what timebombs are ticking there. their equity is gradually sliding, not yet dangerously, probably some creative accounting.
the higher ranking companies tend to not have negative equity, Smiths News have had negative equity for the last 5 years, although their profits and dividends are ok. when I see interesting books at Smiths and Waterstones, I note the ISBN and buy them from amazon much cheaper. eg I saw a book for more than 10 quid at Waterstones, and bought it second hand on amazon for less than a quid. Both are in the permanent shadow of the internet.
Poundland isnt threatened by the internet, because the internet has extra postage costs, in fact some people buy from Poundland to sell on the internet!
phased limit sell orders is the way to deal with such uncertainty. you need to really think what is the minimum you are prepared to sell at, something like
limit sell 600 quid at 615 limit sell 1200 quid at 620 limit sell 1800 quid at 625 limit sell 2400 quid at 630
and then calculate what the costs are also, by using bigger quantities at higher prices, the average is pushed higher. such phasing is the only practical way to do auto bidding. everything at one price doesnt work, always too high eg here or too low. the quantities of money musnt be too small otherwise the costs are too much, and the steps mustnt be too small as the gain isnt worth it.
nothing to stop you putting say limit sell orders at say 600, 605, 610, 615 now, in case of any unforeseen future rise. as you have 17361.9 quid currently from the 10000, you could put 1000 at each of 600, 605, 610, 620, 630, 640, 650, 660, 670, 680, 690, 700, 750, 800, 900, 1000, 1500. then any price spike and you will string up some bargains.
if you have spare cash, you can put some limit buy orders also, eg 1000 at 560, 1000 at 550, 1000 at 540. DO NOT USE STOP ORDERS, UNLESS you are doing leveraged trading where they must always be used as you can lose your house. limit orders good, stop orders bad: tree shaking.
I dont like waiting too long for the initial profit, realistically you need to wait a month to break even if you put say 1000 quid.
I like shares that are generally growing long term, eg 20% a year is great, while average gain good leave them invested.
of the shares I have studied, SPD is the 3rd fastest ongoing growth share since the financial crisis, having grown 24x. I already have 1000 quid on the fastest, which grew almost 30x. have a look at 5 year graph for SPD. I moved my money from SPD to RMG for these interims as a gamble, the evil plan failed and as my broker website was broken, and long wait on the phones, I decided to not wait and sold at just under 5.942 around 816am and lost 8.19 quid. On reading the financials I knew I had to sell quickly, as my plan relied really on the improvement being say 10%. 4% the very minimum.
decided to return money to SPD, end of day price in fact slightly up: recent such for SPD:
but I think SPD remains sound, eg the 2014 world cup june 12 to july 13 must boost their sales a lot. not sure effect of winter olympics 7th feb 2014 to 23rd feb. sport is recession proof. next SPD interims are 20 feb, and last time covered era right up to the interims so should cover winter olympics.
will jettison SPD if bad interims.
investment is all about waiting, waiting for money, waiting to buy, waiting to break even, waiting to sell.
I interpreted as sin of omission to not compare last 3 months
So just got back from hols and ......should have set my sell price at 615p instead of 620p! Was a good plan apart from that! Hindsight and all that! Could have made a quick £400 on re buying but .....coulda shoulda woulda.....lesson learned, don't be greedy! Upside, had a fantastic holiday, if you have ever thought about the Maldives...go, brilliant!
I also like to get in, take a quick profit and get out and now, unless I accept the loss, I can't do that with RMG. "The lamps are going out all over Europe, we shall not see them lit again in our life time".
The interim results is not very good, All these recent rise was expecting a much better that the 2%. I expect this to fall an other 30p in the coming days or weeks. Keep watching. Anyhow I'm out yesterday sold everything at 585.9p. Not bad compare to the way forward.
according to the ProRealTime.com free software, with the FT200,
only 20 gained today, of these 20, (2 made 0 change), the other 180 lost money today, of those 20 some corrected some days earlier!
90% of the top 200 lost money, cannot be a coincidence, and could mean some big money is being pulled from the UK, eg I think big money chases big interest rates, so Carney's comments that no increase to interest rates has maybe driven money to better regimes. low interest rates very BAD for the economy.
but all my shares and all my watchlist including RMG are not yet in danger.
As regards RMG, I think its basically alright as an investment, but its not currently the genre I target.
they made 570m profit the previous year, and the 2% improvements suggests they could make 581m profit this year.
it is this profit which secures the investment.
danger companies are those who are either loss making or have negative equity. With the loan scene, there are 3 phenomena to avoid: loss making, negative equity, poor credit rating eg 25% or less credit rating. Such loans are much more likely to be problematic.
RMG doesnt have any of these problems, using loans scene process I find their credit rating is 58, "good creditworthiness", 5th June 2013 their credit rating was 96, it has fallen continually since then, but is still acceptable.
they have 28 county court judgements, 4 since the privatisation, 3 at Northampton County Court, one at Walsall County court. the 4 amount to some 8200 quid. For a big company this is acceptable.
County Court judgements are an evaluation criterion used when lending to companies, an IPO is a form of lending.
They will probably make 581m profit, so that is either dividend or reinvestment. This 581m will prevent the share price going too low.
As their profits arent increasing I think they have to give a big dividend, and the moment this is announced the price will rocket. So the people who keep their shares long term will eventually get a big profit, but they may need to wait quite some time.
as zenlike points out, 560 is possibly the lower bound of the price. and 600 probably the upper bound. as improvements are 2%, an estimate would be the 2 bounds would be 571 to 612 in a year's time. if the variance is 40 points, then it has short term trading potential. eg put a limit sell order of 337 shares at 595 and a limit buy order of 337 shares at 575. the sell order makes 1999.15 cash, with commission of 6 quid. buy order costs 1953.44. so when both occur in either order you make 45.71 profit, price tennis.
non growth companies are less affected by corrections. RMG is good for very specific genres of investing, eg if you dont mind waiting 2 years for a big profit, or short term traders.
RMG make more than 1.5m quid profit a day and that secures the investment.
Interim management statement: The update is perfectly acceptable, with the previously highlighted themes still in place. The higher margin parcels business, which now accounts for over half of revenues, continues to grow with the company still exploring further opportunities in Europe. Meanwhile, the letters business was inevitably boosted by Christmas card greetings, whilst the energy mailings towards the end of the year provided another fillip. Less positively, there was some cost pressure in the likes of Germany, whilst the previous threat of strike action may have resulted in some loss of business to competitors. More broadly, the profitable parcels business remains one which is vulnerable to new competition, whilst the estimated dividend yield of just under 3% is not the attraction it was at the time of the float, nor does it compare favourably with certain of its European peers. Since the flotation in October, the shares have had a very strong run, having risen 78% from the offer price. As such, the shares may struggle to make further meaningful progress in the shorter term, with the market consensus being that the price is up with events and that the company is simply a hold.
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