TIB: Today I Bought (and Sold) - An Investors Journal #185 - eCommerce, French Banks, Gold, Bitcoin

Gold has been on my mind. Time for gold mining. Bitcoin market likes the tone coming out of the Senate hearing = I do too. January was a great month for portfolios with many new entrants to 56 Percent Club

Portfolio News

Crypto Regulation The CFTC and the SEC appeared in a Senate Committee hearing.

The important outcome was that both remain open to finding ways to make cryptocurrency work. Part of the challenge is that neither of the regulators has full regulatory ambit and there are gaps in the legal structures needed to frame regulation well.

The Senate Banking Committee heard testimony from the chairman of the Commodity Futures Trading Commission (CFTC), Christopher Giancarlo, and the chairman of the Securities and Exchange Commission (SEC), Jay Clayton, on the potential dangers of digital currencies as investments. Their testimony, amid a crackdown on Bitcoin exchanges in China and South Korea, wasn’t as negative as many cyrptocurrency investors had feared

http://fortune.com/2018/02/06/bitcoin-price-cftc-sec-cryptocurrency-hearing/

Work to be done is the best way to view the outcome.

Bought

Redbubble Ltd (RBL): Australian eCommerce. Redbubble provides a marketplace for artists to sell designs. Idea came from a research house my wife uses.

Yamana Gold (AUY): Gold producer. Yamana Gold has appeared on my stock screen a few times. With the big stock selloff last week and Monday I have been reviewing the Gold holdings I have in my portfolios which I use as a hedge against such selloffs. This was also prompted by a strengthening gold price as the US Dollar weakened. My understanding is that gold production cost is averaging somewhere around $1200 per ounce. With gold price holding tidily in a range above that for a while the more cost effective producers will start to produce solid profits. The Yamana chart has the shape I quite like - smashed to lows and then trying to break up. It has had two goes at it - maybe this is the time

The comparative chart with large gold miners represented by the Van Eck Vectors Gold Miners ETF (GDX - red line) shows that Yamana has been under-performing since the 2013 highs and is now 28 percentage points behind. What I like is the bounce off the lows in late 2017 has been stronger than GDX.

Now time to dig into the cost data a little deeper. There are two parts to costs to consider - cash costs and all in sustaining costs. First chart shows a projection of mining cash costs and all in costs. The low end of the forecast range is below the current gold price. [Note: this chart is from 2014 - I have found other cumulative cost curve charts from later that confirm the $1200 to be a solid level]

https://smaulgld.com/gold-supply-and-demand/

The important piece is knowing where Yamana fits in on this cost curve. The good news is it is at the lowest end. On top of that Yamana also operates in Silver and Copper markets = more than a gold play.

Yamana's latest presentation confirms this data is still relevant (below $600 cash cost)

http://www.valuewalk.com/2017/08/todays-gold-prices-not-much-production-costs/

BNP Paribas (BNP.PA): French Bank. French banks and me are not doing it. After making a finger trouble trade buying 1 share the day before, I managed to get the extra shares I wanted in 2 more trades - so trading cost is now 1.8% of trade value. Got to make that up first (and cover trading cost on the way out)

Cryptocurency

Bitcoin (BTCUSD): Price range for the day was $1436 (16.6% of the high) which is double normal volatility. It did not feel that way as price was moving up from prior day lows. I added one new position at $7477 and closed out 3 for average profit of $420 per contract (6.9%). I am steadily improving my approach and using channels to time entry and exit rather than just working on reversals - hence one losing trade at the top of a channel taking out a trade put in earlier as a reversal in mid-channel going down. The chart shows the channels yesterday and today's forming. A channel really needs two touches on each side to be valid. The chart also shows a pending order (middle dotted green line) and take profit target (dotted red line)

Crypto Robot Robots closed 2 trades for 2.43% and 1.69% profits. With a strong move up in Bitcoin prices altcoin performance sags and lags. This is early days of watching and quite some time before I recover the cost of investment.

I did set up the VPS for my own bot. Now it is time to get to grips with the bot itself and to formulate a strategy. My idea is to trade against Ethereum - not worked out which pairs to focus on.

Currency Trades

Forex Robot did not close any trades and is trading at a negative equity level of 7.6% (lower than prior day's 8.4%).

Outsourced MAM account I run an outsourced forex trading account with Actions to Wealth. They closed out 6 trades for 0.55% profits for the day.

56 Percent Club

56 Percent Club idea was started by a friend who asked what has done 56 percent in the last 12 months. Each month, I review all my portfolios and tabulate the 56 percent movers from all time and highlighting the ones from the last 12 months. I review stocks and options separately.

First is the table of stocks. I have highlighted ones that are new to the club in Yellow. I have also marked up whether they have gone up or down since last time.

A bunch of things stand out:

• The list is a lot longer than last time (31 vs 26)
• A new number one - Wells Fargo - been in my portfolios a long time
• Banks have clawed their way to the top of the list
• Technology sector is well represented with new entries from NVIDIA and the Technology Select ETF (XLK)
• Two new Japanese stocks (Sony and Osaka Titanium) on the list replacing two sold during the month (Hitachi and Sumitomo Chemical)
• Old world steel makes an appearance on the stocks list (been on the options list for a while) through Arcelor Mittal
• Commodities are climbing with BHP US ADRs making an appearance.
• The world takes to pot with MMJ Phytottech rising through its holding in Canadian marijuana producer - Harvest One (HVST.TO)

On the options side

What stands out here:

• 33 entrants vs 24 last time
• First 10 bagger with 1113% on Arcelor Mittal options. I do not often score 10 baggers as I tend to roll up to stay out-the-money. With market valuations beginning to stretch I am rolling up less often.
• A bunch (4) of new entrants from the insurance industry in Europe
• US regional banks are climbing hard with 4 new entrants joining Zion Bancorporation and Associated Bancorp
• My decision to swtich from short China to long China proving right with the A-Shares ETF pitching in with 60% in a month.
• India and South Korea join Argentina in the Emerging Markets race. South Korea had fallen off lst month but is now back

Crypto investments are not listed - very many are over 56%.

See TIB167 for the December 2017 edition.

Cautions This is not financial advice. You need to consider your own financial position and take your own advice before you follow any of my ideas

Images: I own the rights to use and edit the Buy Sell image. News headlines come from Google Search. Gold images are credited below images. All other images are created using my various trading and charting platforms. They are all my own work

Tickers: I monitor my portfolios using Yahoo Finance. The ticker symbols used are Yahoo Finance tickers

Charts: http://mymark.mx/TradingView - this is a free charting package. I have a Pro subscription to get access to real time forex prices

Crypto Trading: get 6 months free trades with Bitmex for leveraged crypto trading. http://mymark.mx/Bitmex

Bitcoin: Now that Bitcoin price is back up, get started with Bitcoin for as little as €50 (in Bitcoin) and earn Bitcoin at a rate way better than your bank will offer - think weeks instead of months. Now available again in US or Canada http://mymark.mx/Mark

February 7, 2018