Crowded trade
12.04 pm The index is down 25 points but the story of the day for me is Bluescope which reported very well but provided a gloomy outlook. The danger with this sort of crowded trade is everyone running for the exit at once and that has well and truly happened with a 20% fall at this point. So, a shocking start for me in the medium term book and I have to work out the best time to exit the trade. I'm thinking in a couple of days.
Otherwise, everything else is pretty much fine.
12.42 pm TWE has pushed on today, up 29 to 1370. I added more stock at 1355.
2 pm Out of BSL (1101) as there's no rationale to hold it now that the earnings and margin growth that was expected has evaporated. In fact, margins are actually going to be lower and profit too. Painful but better to take the loss relatively early.
One minnow I've bought today is milk powder company Wattle Health. The stock is breaking bullishly out of a pennant. Long at 97.5 and currently trading at 99.5.
The other small dollar long I have is in NWH and that has followed through on Friday's promising finish to be up 4 at 99.
4.30 pm The index fell just below 5700 today and bounced off it to finish 21 points lower at 5726. I sold out of TWE for an average of about 1370.
I've added a long in BPT. The result was as good as expected but it's super cheap and heavily discounted on fears of a capital raising if they go for a big acquisition. However, the commentary was that they have been able to more than cover production with new reserves - the big issue is reserve life - and it may be that the market has underestimated the ability to grow future production without a major acquisition. We'll see tomorrow, it's just a quickie and I'm hoping for 72, say. Long was bought at 66.5.
Otherwise, everything else is pretty much fine.
12.42 pm TWE has pushed on today, up 29 to 1370. I added more stock at 1355.
2 pm Out of BSL (1101) as there's no rationale to hold it now that the earnings and margin growth that was expected has evaporated. In fact, margins are actually going to be lower and profit too. Painful but better to take the loss relatively early.
One minnow I've bought today is milk powder company Wattle Health. The stock is breaking bullishly out of a pennant. Long at 97.5 and currently trading at 99.5.
4.30 pm The index fell just below 5700 today and bounced off it to finish 21 points lower at 5726. I sold out of TWE for an average of about 1370.
I've added a long in BPT. The result was as good as expected but it's super cheap and heavily discounted on fears of a capital raising if they go for a big acquisition. However, the commentary was that they have been able to more than cover production with new reserves - the big issue is reserve life - and it may be that the market has underestimated the ability to grow future production without a major acquisition. We'll see tomorrow, it's just a quickie and I'm hoping for 72, say. Long was bought at 66.5.
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