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dogs of the dow

Discussion in 'Other Asset Classes' started by kum yin lau, 4th Aug, 2016.

  1. kum yin lau

    kum yin lau Well-Known Member

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    Hi, please feel free to comment or advise. I've lately thought of mucking around with a few thousand dollars.

    Buy the shares that have tanked.

    Imagine:

    ERA: I BOUGHT AT $5 fortunately sold at a loss at 4.78 now only 34 cents! I bought 3188 shares at 33.5 cents which cost about the same as the 2000 shares that I bought before.
    BOL : I sold at 40-50 cents can't even remember, current price 8 cents
    NTU: I had a truck of this at 60 cents which I later sold between 16-26 cents now only 7 cents
    USA: I didn't buy before but now only 1.5 cents

    $5000 will buy a containerful of shares!!

    KY
     
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  2. Skilled_Migrant

    Skilled_Migrant Well-Known Member

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  3. kum yin lau

    kum yin lau Well-Known Member

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    Hi there, thanks for the links and for your interest. As I read the articles, I understand that I held some errorneous perceptions about the dogs. I thought that ANY share that tanked is automatically a dog. Not true.

    So, the biggest dog of the ASX has to be BHP when I bought it at $14.50!!

    QBE is another big Doberman. I personally like ERA and STO

    In fact, most of the miners are dogs, aren't they?

    I'll let you all know if I do continue with the dogs.

    KY
     
  4. Jess Peletier

    Jess Peletier Mortgage Broker - Australia Wide Business Member

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    The main thing with dogs is to make sure they aren't dropping any more before buying. For me that means a period of consolidation and then prices staying to rise again. You don't want to buy a bargain only to find its actually not. I don't care about getting the very lowest price - that's pure luck if you can pull it off.
     
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  5. Marg4000

    Marg4000 Well-Known Member

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    You really need to understand the reason for the low share price. Sometimes the market does over-correct, but sometimes the downward slide continues.
    Marg
     
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  6. Skilled_Migrant

    Skilled_Migrant Well-Known Member

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    What time frames and TA for consolidation do you consider, when the recommended (but not always followed) portfolio readjustments are done annually.

    The entry criteria (back tested for decades :1929-1996 @ 12.7% albeit with caveats) for DoD does provide some modicum of risk aversion, in the sense that the stocks are still in the index, so some kind of independent institutional evaluation has been done to leave it in the index. Some risk is also covered by high yield.
     
  7. marty998

    marty998 Well-Known Member

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    TLS is still below 1999 T2 float prices? That's pretty woof woof if you ask me.

    Regarding QBE, the other insurers IAG and SUN have been pretty ordinary as well since 2007 (remember when Suncorp was $24? Then it bought Promina...)

    Always thought AMP was the biggest Canine of the all.
     
  8. Jess Peletier

    Jess Peletier Mortgage Broker - Australia Wide Business Member

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    I look at weekly charts as that's my preferred timeframe these days. If I can see that price has been going sideways for a few months, and has started picking back up, preferably with increased volume, I'll look to buy. If price drops below the sideways action low, that's my signal that I'm wrong and I get out. I don't want to be in a share that's trending down.
     
  9. The Falcon

    The Falcon Well-Known Member

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    "Dogs of the Dow" is a very simple quant value investing approach.

    It is not a trading strategy.
     
  10. austing

    austing Well-Known Member

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    If you want to apply "Dogs of the Dow" locally do a search on "Dingoes of the ASX"

    I'm not a great believer in the strategy but the following article is but one of many interpretations of the approach;

    Dividend Yield Investing (Australia)
     
  11. The Falcon

    The Falcon Well-Known Member

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    Australian general insurers are poor businesses across the board. A good filter along with resources, airlines, reits.............

    Yes, DJIA is interesting in that is not a simple cap weighted index. There are some qualitative guidelines employed which determines what goes in and comes out. Its also a price weighted (as opposed to cap weighted) index. I'd be very leery of transferring a strategy back tested on the Dow to say, the ASX200.

    If you are interested in the kind of stuff "The 52 week low formula" is another similar quant value strategy with additional filters. The book might be of interest to you. Where I come at to all of this stuff really is you need to be running post tax calcs to assess the viability of the strategy in the real world, and that its all well and good to start a rules based portfolio, its another to stick with it.
     
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  12. joel

    joel Well-Known Member

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    STO aren't a good investment even in a high oil price environment.. with them you're basically betting the oil price will rebound. Maybe try SXY or BPT for an energy company with better fundamentals
     
  13. kum yin lau

    kum yin lau Well-Known Member

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    Hi, I'll check SXY and BPT. I'm looking for dingoes!!

    The mastiff I bought at under 6 cents is NEA currently 54 cents. Like I said, at those prices, one could buy containerloads of them. The best thing I ever did was I moved the real dogs like NTU etc to buy the newer dog which became a good dog to own.

    KY
     
  14. kum yin lau

    kum yin lau Well-Known Member

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    Hi, updates. I'm kicking myself for selling NEA at 48 cents. The price today is 73
    QBE has bounced back a bit. It's 10.24 I bought all the way down to 9.40 but didn't dare buy any more at 9.24

    Still good for a 35 day spree.

    NTU is now on the list of to buy.

    KY
     
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  15. kum yin lau

    kum yin lau Well-Known Member

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    Hi, interested yet? NEA current price 90+ BHP 23+ QBE 10.35 BOL 11.5 NTU 15

    It's only been 3 months but if anyone bought a containerful of BOL or NTU ...

    I did make 2 thousand from the most unlikely of shares DYE

    Now I like BPF and YBR mostly because the financials show them making money.

    KY