@Strawman I am definitely starting to get this.

I only started active investing with meaningful amounts of $ in 2016. Over those early years when I suffered losses, I found it hard to take and wondered whether I should give up and return to passive investing (buy the index).

Fortunately, in those “early days” even idiots could make a fortune - and I was probably one of them. But I was an idiot who was keen to learn.

Over time, I’ve got better at losing (and winning) and sticking to a few basic rules has really helped take the stress out of investing, so that I sleep very well - even when the scorecard is ablaze with red.

My 7 key rules:

• Circle of competence - stick to it
• Explicitly estimate (even guesstimate) risk-reward
• Manage position sizing according to risk appetite
• Don't react to the share price (obviously do act upon information that is likely driving the share price). For share price, you can substitute brokers!
• Keep your thesis in front of you, and recognise if creep is happening
• Manage emotion (when a surprise loss hits, recall your last surprise win, and vice versa)
• Making and keeping money is hard - everyone else is trying to do it, and they are on the other side of your trade. So stay humble.

Love that @mikebrisy

Stay humble is perhaps the most important one of all.

This is a game where pride really does cometh before a fall.

Well the US market on Monday 5 August chucked quite a few opportunities along the way for my US paper trade account.

I literally put all the money into work on Monday with the popular ones and a few specs and ones with a good chart.

For the technicals, it looks like a breakaway gap? I did this before with AZS and worked quite well.

Apparently this one popped due to positive earnings guidance which surprised analysts that forecasted negative earnings so bought a small amount in my USD real money account (which happens to be quite small).

Got to try and study the US market more.

But it is hard to say if there will be another unwind on the horizon as it happens when you least expect it.

Second week on the US Paper trading account. Beginner's luck?

It is easier buying the dip when it is imaginary money. And I'm surprised by the amount of variety on the US market once you dig deeper.

Just FYI this account is for an assessment task, so I can't reveal everything till the trading period is over.

But I will say that I bought Amazon and Facebook which both had pretty good multiples compared to some of the stuff on the ASX.

Amazon trades 41x versus WES 33x. But you get Cloud and AI tech as a bonus so therefore it is "cheap" compared to WES.

Facebook trades 24x so I wonder why that Cadence guy was so dumb to not buy more (or even sell as mentioned before)

As a spec medical play I bought a small position in Corvus (the team behind Rituximab which is the adjunct kidney drug that CSL and DXB can't be bothered mentioning) but will take profit soon as it is one of "those stocks that trade on hype like DRO and CU6".

And finally Flex which is similar to IPD group but much bigger and more diversified.

Still have Omnicell here and in real life. In hindsight should have bought Flex instead.

The holdings have had bigger upside moves but equally bigger downside moves compared to the SP500 but overall I'm ahead and doing better than my real life one.

Will probably jink it now.... and Buffett will be right.

Current week without hyperdrive special broker lunches stock Corvus Pharmaceuticals. Would have been higher if I didn't sell.

One of the ESG stocks popped in with a 10%+ gain for the day which was highly unexpected as it was trending down and I did not really see much tailwinds in the business. They do measuring and diagnostics devices for various sectors so maybe similar to Codan???

So because of that one stock, I have jumped up to rank 9.

The ESG criteria is that we select stocks that have a ESG risk score below 9. So there is not much choice here

After initially opening higher on the jobs report (non farm payrolls 142k which was midpoint of 100k and 165k and unemployment 4.2%) the market took a dramatic turn and dumped!

I initially thought I made a mistake closing my paper trades early this week. Looks like I was right.

Bad news is not now good news for the market.

I still hold healthcare technology stock OMCL in my real account. For some reason that has been very stable even after suffering a few target downgrades on valuation concerns. I don't see any reason to change knowing they have finally gone back to profit in 1H and they still forecast FY profit My assumption is that analysts are still catching up on the story here.

Sold ARIS on earnings miss 8/8. Turned out to be a dumb move when ARIS upgraded the forward outlook. Jinxed by the early morning share price dump!

Bought XYLEM 14/8

Exited Corvus 16/8 on announcement of 300m shelf offering which includes 100m to Jefferies investment bank - looks like a future capital raising. Possibly another bad move as share price mooned a week after that. Now back to $4.

Exited Meta 26/8/2024 when insider selling by multiple board members (Zuck and co) snowballed during the week Reduced Uber to half when EU fined company on data protection breach

Added XYLEM 26/8

All Exited 5/09/2024

A rating downgrade on XYL from TD bank from buy to hold changed the XYL position from profit to slight loss and was the only losing position in the end. Cite cyclical concerns regarding water utility market. I'll need to research that a bit more. So poor move increasing XYL after selling UBER and META and my rank dived below 100 as a result.

XYL has fallen further since then. Doesn't bode well for EVS which also has water monitoring products..

Because I exited early, I have now outperformed the market. Proof you can beat it (if you have the resources time/tools/money etc)??? But I also think I had a bit of luck.

Managed to finish in the top 100 in the end, but no longer in the top 20.

Not a good week for global markets @edgescape -

In percentage terms, the Aussie market fell less than the rest of the world, however we have a Resources economy and many of our mining stocks are tanking, so I'd reckon a "correction" at some point wouldn't be out of the question, i.e. we could easily fall harder and faster than we have. Luckily our Big Banks (Financials - our largest industry sector on the ASX) are holding up very well -

It looks like we have a decent Health Care sector, but CSL makes up most of that, so take away CSL and it moves right down the list. Incidentally, there are just 5 other Aussie Health Care companies worth over $10 billion, RMD, FPH, COH, PME and SHL, and the largest of those 5, ResMed, @ A$23 billion, is less than one sixth of the market cap of CSL (@ A$147 billion). I would have thought PME was more software and services, but there you go.

Source: https://www.listcorp.com/asx/sectors/health-care

The ASX 200 was only down 0.97% last week, and remains close to all-time highs, being only -1.6% off its year high. So, nothing nasty here so far. And it's mostly the banks that are holding us up. Have a look at how our sectors performed over the past week:

Our two largest sectors are certainly diverging - Resources down -7% while Banks are up +2.6% over 5 trading days. And they've been rising for a while...

But back to resources. There is likely money to be made when that tide turns and metal prices head north - and that won't all happen at the same time clearly as different metals have different price drivers. The following graphs from Marcus Padley's MarcusToday Saturday newsletter (as are the graphs and tables above, except for the sector pie chart) display a fair bit about leverage. Firstly, Uranium:

Boss Energy looks like the best leverage to the uranium price, because the BOE SP moves up by more than the uranium price when the uranium price rises, and it falls by more than the uranium price when the uranium price falls - so... leverage. Interestingly, you would expect this sort of thing with a company with a decent debt-load, but BOE have zero net debt and are actually profitable (lately).

Boss Energy EARNINGS:_______________________Boss Energy R.O.E. (%)

Their latest company Presentation (Find it here: https://bossenergy.com/investors/asx-announcements) says: Boss has delivered two producing mines and has a market capital growth of $1.1B and zero debt.

A month ago on slide 4 of this D&D presso - https://bossenergy.com/images/documents/Diggers-and-Dealers-Presentation-2024.pdf - that number was higher, at $1.3B - which obviously refers simply to their market capitalisation not their available growth capital - strange wording. Their m/cap is now around the $1 billion mark, but they do have two producing mines, which is more than you can say for the vast majority of other uranium hopefulls that trade on the ASX. Not my area of specialty to be honest, so not holding, but if I wanted uranium exposure, looks like BOE might be worth a look.

Now to Sandfire vs the copper price, and Sandfire has outperformed, so not sure if that indicates they've run too hard or that the market is more bullish on the copper price being higher in future years and Sandfire (SFR) being very well placed to capitalise on that higher copper price.

WIRE is the Global X Copper Miners ETF, so an ETF of global copper miners, not a physical copper ETF, and that WIRE ETF got ahead of the copper price in that recent April to August period but has come back to it now. SFR however remains well above both of them.

It should be noted that copper remains uncontroversial compared to uranium, with the vast majority of people believing that there is no doubt the world will need more copper in future years - and most people believing that current copper mines and ones currently under development are unlikely to be able to meet (satisfy) that demand - so we need more copper mines to be developed. It should also be noted that SFR is probably the only true Aussie pure-play copper company of significant size (in terms of market cap and annual copper production, as well as assets owned, and geographical spread of those assets) on the ASX, so while there are other companies that produce plenty of copper, like BHP, for people who want JUST copper exposure rather than the copper exposure they get through a miner that is diversified across multiple commodities, then SFR is the go-to stock for that pure copper exposure. OZ Minerals was another option, but BHP acquired OZL in April 2023, so they're not a pure-play option any more. We really just have Sandfire.

Shortly after BHP aquired OZL in April last year, Metals Acquisition (Corp) Limited (MAC) acquired the CSA Copper Mine - located near Cobar, New South Wales - from Glencore PLC (in June 2023) - so some people thought MAC might be another way to play copper on the ASX, however MAC is actually a private limited company incorporated under the laws of Jersey, Channel Islands and listed on the NYSE as a Special Purpose Acquisition Company (SPAC) that is focused on the acquisition and operation of mining assets - with the CSA Copper Mine being their main asset at this point. However, expect further acquisitions; it's in their company name! And future acquisitions might not be copper. MAC is dual listed (ASX + NYSE) and at the time of listing (mid-last-year), ex-Northern Star Resources chief Bill Beament and ex-Fortescue executive Nev Power were behind it, although the pair are no longer involved.

This article from May this year: https://stocksdownunder.com/article/metals-acquisition-asxmac/ describes MAC as a Billion Dollar Company, but their market cap is currently just under half a billion. They were clearly worth less than one bil when that article was published because they peaked in May at $22.73/share and they're now trading at just over $15/share, so while their SP has dropped significantly, it haven't halved (yet). The market attributed more than A$1 Billion to the company (in market value terms) when they listed last year, which is probably what the article is refering to - and 14 months later they're trading at half of those levels. MAC the SPAC is not one I'm interested in at all, but it does get mentioned as one way to play copper here in Oz - not one of the best ways however, IMO. SFR looks like the goods in that department.

I'm following copper, but not directly exposed to it at this point. I have held SFR previously. I am only exposed to gold in terms of metals exposure via direct investment in companies, at this point. And to companies that service the mining sector, like NRW (NWH), GR Engineering (GNG) and Lycopodium (LYL).

My risk appetite has decreased significantly since I retired early - in the first half of calendar 2024. So the following table in the latest (today's) MT newsletter caught my eye:

What would be even better would be to have after-fees returns comparison between those ETFs in addition to those management and performance fees comparisions.

My current choice for that sort of exposure is via two LICs - WLE and WGB (WAM Leaders and WAM Global) - both acquired recently at discounts to their NTA (aka NAV) and that choice was primarily for (a) the exposure to companies that are not ones I follow closely and/or have any sort of investing edge with (global companies in the case of WGB and ASX large caps in the case of WLE) but that I am happy to have exposure to through outsourcing that element of my portfolio management, and (b) income in the form of fully franked dividends that have been rising every year since inception in both cases. The clincher in both cases was their very healthy "profit reserves", a feature that allows LICs to keep paying dividends, and indeed keep raising their dividends, even when they have bad years and/or actually lose money. Both WGB and WLE have profit reserves that cover years worth of future dividends. Those are the only two LICs I currently have any exposure to, and zero ETFs at this point, but I do use ETFs reasonably often for exposure to sectors or markets for almost zero fees (in the overall scheme of things).

So, yeah @edgescape - that does sound like fun, but I don't have that amount of time available, despite my early retirement, to get my head around US markets or any markets outside of Australia really, so I'll get my global exposure through WGB for now, who incidentally tend to avoid the Magnificent Seven - Apple, Microsoft, Amazon, Alphabet (Google), Meta Platforms (Facebook), Nvidia, and Tesla - and instead invest in things like MSCI (Morgan Stanley Capital International) who run WGB's own benchmark index, as well as SAP and other global market leaders in their field who also have strong tailwinds.

Their Benchmark, the MSCI World Index (in AU$) has outperformed WAM Global (WGB) and WGB has just managed to stay ahead of the MSCI World SMID Cap Index (in AU$) so they aren't cleaning up on performance fees, just charging management fees, and I like that they're paying fully franked (and rising) dividends, particularly when those franking credits can only be generated from trading profits, as none of their investee companies generate any franking credits themselves as they don't pay Australian tax (being overseas based companies) so there are zero franking credits passed through to WGB from their investee companies; WGB simply pay tax here themselves on their trading profits (capital gains) and pay sufficient tax by doing that to fully frank their dividends, and their dividend yield is decent - around 5.3% p.a. based on their current share price (and I paid a little less than their current share price) plus the value of their franking credits so that's around 7.4% p.a. as a grossed-up yield.

WLE's dividend yield is higher still, at around 7.2% p.a., or just over 10% p.a. grossed up (to include the full value of those franking credits). The growth potential is a lot lower than it would likely be by investing the same money in fast growing companies, but the income is locked in. Nothing in life is guaranteed, but decent dividends from those two LICs with their respective profit reserves being as large as they are, is close enough to a sure thing for me.

And income is important to me right now. I have exposure to a few companies directly that are growing at a good clip, but WLE and WGB are not that - they are about set-and-forget income, with a decent portion of my investable capital. Other available options include those fixed income ETFs in that table above, although I'm not using any of those at this point.

My idea is to lock in my required income (hopefully without significant capital losses that offset that income) and then to use the rest of my investable capital to make some capital gains. Some companies provide both, like LYL over decent timeframes (Lycopodium is my largest position after WLE), and others are likely to provide capital growth only (no dividends), like Cooper Energy (COE) hopefully. I like to mix it up a bit, as long as I know me and mine have enough to live on, comfortably. Time to cook some lunch.

@Bear77

The paper trades are for an assessment research task on ESG so this task is actually mandatory.

I also tried to do as less trades as possible so I can write less. But every time when some significant news pops up I had to determine whether the event was actionable or just noise. I then need to document each trade and the reason behind the trade with the referenced announcement or news release (in the appropriate format ie: Harvard).

So obviously it became apparent that each trade became a mini assignment in itself!

Also I could not use technical analysis as a reason (ie: there were more red candlesticks this week than last week or the short term MA moved below 200 MA etc)

On the flipside I get extra marks if my portfolio balance is more than the index balance. Last day of trade is Monday so the SP500 still has time to rally 3% to beat the portfolio.

But given that investors think the payrolls miss deserves a 50 basis point rate cut instead of the 25 basis point cut by the Fed because of no soft landing, I think the SP500 is unlikely to recover from Friday's session unless the Fed jumps in with a sudden rate cut (highly unlikely)

https://finance.yahoo.com/news/live/stock-market-today-dow-sp-500-continue-september-swoon-ahead-of-pivotal-jobs-report-200215727.html

I have also observed liquidity has been poor in this past week as well which prompted me to exit early before the final day which is Monday.

I'll also add that Keysight Tech was the ESG stock and dark horse outsider which contributed the most.

I wanted to trade a bit of gold but only decent one I could find that had a good "story" was Mandalay Resources which was only on the OTC pink market and did not have time to confirm if that could be included.

OK @edgescape Thanks for the clarification. Always good to outperform the market, even over shorter time periods, especially since one really bad move by a major position can torpedo your gains in no time at all. The idea behind me selling up my largest portfolio in June was partly because I had moved back ahead of the index since inception of that portfolio (just shy of 7 years) after racing out of the blocks and then having a few choice companies go pear-shaped on me through the middle section, and then having a blinder over the last 18 months to end of May this year - where I seriously outperformed to drag the portfolio performance back to being JUST in front of the XJO (ASX 200 Accumulation index) over the full (almost 7 year) period, and we were looking to wind it up by the end of this calendar year anyway (trust structure that we needed to close down which meant a total sell-up and full distribution to all unitholders/beneficiaries of the unit trust) and then I thought about the risks of losing those hard-won gains (that had been made over the preceeding 18 months) and the paperwork we could save by having it all done and dusted by June 30, so we went with that June 30 deadline and got it done, which meant a few different sells with some of the more illiquid names over a few days, but it got done. Was that all one sentence? My old English teacher would be horrified!

I now have more freedom to invest any way I want, albeit with slightly less capital, without having to write a monthly newsletter to justify it - I just waffle on here instead whenever the mood hits me.

Thing is, I ended up very slightly underperforming the index with that portfolio in the end because the index had a good run up to June 30 after I'd gone to cash progressively through June - so ended up close enough to breakeven - or matching the index, but technically just slightly underperforming, and that underperformance happened in the final week of June because I had almost no market exposure (80% cash by mid-June and 100% cash by June 27th) for that portfolio. The difference was almost a rounding error, so I'll say I matched the index, but that's a pretty poor outcome over almost 7 years with active investing - to not be able to beat the ASX200.

Not what I expected, I have to say. But that's what that portfolio managed to achieve - no better than matching the index, and obviously that's after costs, and there were plenty of brokerage fees along the way, even after we switched the portfolio into Selfwealth with their flat brokerage fee structure. Seven years ago, I was fairly confident that I would not only beat the market (XJO/ASX200) but that I would beat it easily. Not so easy as it turns out. Periods of solid outperformance, sure, but it doesn't take much for that to unwind, particularly if you get too concentrated and have a couple of positions go south quickly on you and you buy more instead of selling out. My biggest mistakes were always not selling as soon as I should have when my investment thesis was busted, i.e. engaging in thesis-creep. I made mistakes with buying things I should never have bought, sure, but that wouldn't have hurt me if I had cut my losses on those early enough; However, there were a few companies where I believed the story too much, rather than the facts, and you always have to change your mind when the facts change or the situation/outlook for that company changes.

So, having done that for almost seven years - since late 2017 - for no financial gain over and above an index tracker, just lots of "experience" and "lessons learned", I was keen to do things a little differently, at least for a while, hence the re-entry into those two LICs I mentioned with around $200 K of my investable capital outside of super. And my outsized positions in LYL and GNG as well, all four of those being companies I can NOT hold in my super because they're not in the ASX300 index (one of the fund rules) and CBUS do allow some ETFs but not LICs.

Risk is a funny thing. We think we can manage it, but we don't always know how to totally define it - i.e. sometimes the risks come from outside of our field of perception. I have certainly learnt a LOT about risk management over the past 6 years in particular. You can't avoid it altogether, but there are ways of managing it within your own particular risk tolerance levels. But black swan events still happen. And stuff still comes out of left field. It all keeps us on our toes, right?!

With the news from Yahoo and the SP500 I'm closely watching NWL and HUB on Monday.

Maybe PPS as well although I still view that as lower quality than the other 2..

Probably bit late now but any companies earning Yen directly?

Forgot to deposit some jpy to my Japanese buyer agent account as a hedge doh!

Very good silver lining @mikebrisy. TNE would be the other buy for me if we get a further sell off at around $16.