Beat the Deadline…

  • An options ‘ready reckoner’
  • 2016 Conference Update
  • Just when will house prices crash?

The deadline is approaching.

This Wednesday, at midnight, our most generous money-back guarantee offer ends — perhaps for good.

We’ve had a pretty good response to it so far.

Folks who are looking for a new way to earn an income from the stock market, sometimes without even buying a stock, have taken the opportunity to try our flagship investment advisory for a six-month trial period.

During that time, if they’re not convinced the service is for them, they can just contact our customer service team and ask for a refund of their subscription — no questions asked, and no catch.

If you’ve been interested in options trading before, or you’ve tried it before and couldn’t get it to work for you, now is the time to check out our six-month, money-back trial subscription to Options Trader.

To find out the full details, go here.

Markets

Over the weekend, the Dow Jones Industrial Average fell nearly 29 points, or 0.2%.

The S&P 500 index fell two points, or 0.1%.

In Europe, the Euro Stoxx 500 index dropped 0.2%.

The FTSE 100 and French CAC 40 indices fell 0.3% and 0.4% respectively. Germany’s DAX lost 0.4%.

In Asian markets, the Nikkei 225 index is down 3.1%, while China’s Shanghai Composite is down 1.7%.

The Aussie S&P/ASX 200 index is down 21 points, or 0.4%.

Across commodities markets, West Texas Intermediate crude oil is trading down 4.4%, at US$38.58 per barrel. Gold is trading for US$1,233 per ounce.

The Aussie dollar has slipped from last week’s highs. It’s worth 76.68 US cents.

An options ‘ready reckoner’

Getting back to Options Trader for a moment, subscriber Paul writes:

I have been trying to wrap my head around all of the ins and outs in the options world, and I thank you for the information you continue to provide.

I have a request that might assist those of us that are "newbies" at all of this. I have provided a table below that I know is incomplete and terribly incorrect (!!) but I expect that if you were able to put the correct information or examples into this format it would be useful for your subscribers.

I hope you might publish this somewhere for us to paste beside our screens while we learn!

Beneath Paul’s email, he included a table. It includes starting capital, number of shares per contract, premium income received, and so on.

I haven’t included it here, because we’ll need to check the contents, but I’ve forwarded it to Options Trader editor Matt Hibbard to see if it’s something he could use to help his new traders.

If Matt likes it, I’m sure he’ll let his subscribers know about it, and make it available for everyone to download and use.

It’s like a ‘ready-reckoner’ if you will. I like the idea. I can see it as being super useful for beginners to use as a way to write out, in longhand, their trade before they place it.

And I think it would be useful for those with a bit more experience too. I know that when I place an options trade, I still read the order ticket back to myself before hitting the button — just to make sure that I’ve gotten everything right.

Anyway, Paul’s email is exactly the kind of relationship Matt is trying to develop with his readers. He knows that options can be complicated, so he’s trying to find as many ways as possible to make options more accessible to the ordinary investor.

More on Options Trader here.

2016 Conference Update

Speaking of reader mail, we’ve had a few more suggestions for our 2016 investment conference. Subscriber John P writes:

Thanks for this opportunity!

What do you want the speakers to talk about at the conference? Market forecasts long term and short term; the impending bubble-burst/big global crash and how to profit from it; moderated Q&A session/debate style with speakers with conflicting/differing philosophies.

Who would you like to see speak at the conference? I suggest we have such a proliferation of talent, skills, abilities and experiences within PPP why go anywhere else?

Where would you like the conference to be held? 1: Sydney 2: Gold Coast.

On the second point, John P really is being too kind. But we’ll accept the flattery anyway.

In previous years we’ve tried to provide attendees with a good mix of local and international talent.

The big international stars tend to focus on big picture macroeconomics; the locals (such as our editors) tend to focus on the micro — including comments on individual stocks.

This year will likely be the same. But one thing I’m keen to reintroduce this year is the breakout sessions. This is where we’ll stick one of our editors in a room for an hour, and the audience can quiz them about a specific stock pick or investment strategy.

Sometimes, the breakout sessions can be the best part of the show. Aside from a 20-minute or so introduction, they’re mostly unscripted, allowing editors to take questions from the floor.

And I don’t mean the ‘Dorothy Dixer’ kind of questioning either. I mean questions quizzing editors about something they wrote six months ago, which most have forgotten, except for that one reader who mentions it now!

Or it might be a question about a stock pick that went wrong, or (hopefully) praise for a stock pick that went right.

Anyway, we’re still working on the first draft of the schedule. The plan is to have almost everything in place by the time we begin offering tickets in mid-May. So stay tuned.

Another letter. This one from subscriber, Adrian:

Cutting to the chase; I think Brisbane, the Gold Coast, or Sunshine Coast are the very best locations. On what subject of interest is: bringing together the short term view such as three month options outlook in the context of trends such as seen in Quant Trader would be most valuable to me. And finally, I don’t mind who talks about it, as any opinion is as valid as the other — therefore several speakers on the same subject would be very interesting indeed.

There’s a lot in that letter. But on the last point, we try to pick a broad theme for our conferences, something that ties everything together. But then, we pretty much allow the speakers to take things where they want.

Looking at the rough timetable we’re putting together, it looks as though we’ll have around 10 slots for speakers, two panel discussions and, of course, the breakout sessions.

I would be surprised if there wasn’t some element of crossover, some agreement and, probably, a bunch of disagreement on various themes too.

Again, keep your eyes peeled. We hope to email you the conference invitation by the middle of May. And keep the suggestions coming. Send them to letters@portphillipinsider.com.au.

Just when will house prices crash?

One of the things that will no doubt come up at our investment conference is the question of Aussie house prices.

For longer than I care to mention, my colleagues (except Phil Anderson) and I predicted a major crash for house prices. Since making those predictions, Aussie house prices have…soared to new highs.

Can it last forever? The answer must surely be no.

And perhaps there is now more evidence than ever to support the idea of at least a major price fall. As The Age reports:

Real estate spruiker John McGrath has blamed an unforeseen low volume of listings and sales in the first half of April, particularly in the north and north-western suburbs of Sydney, which has led to an earnings downgrade for the 2016 year.

The agency, which only listed in December, has seen its share price fall by as much as 34 per cent this morning when it came out of a trading halt. At 10.35am, shares in McGrath were trading at 98 cents. They last traded on Thursday at $1.30.

Mr McGrath, the so-called ‘Mr Real Estate’ in Sydney, owns 27 per cent of the listed entity. It floated at $2.10, but has not traded near that level since.

At the close, McGrath Ltd [ASX:MEA] shares were trading at 89 cents. That’s down 30.8% for the day.

Not a great day or, in fact, a great time overall for the real estate sector. In barely five months, the stock is down 57%, and there is now talk about big trouble ahead for both Sydney and Melbourne housing markets.

For a sector in trouble, I’m sure the news in yesterday’s Age wouldn’t please Victoria’s army of property investors:

Properties that have been unoccupied for a substantial period would be taxed to boost support for women fleeing abusive homes, under a proposal to be considered by the state government.

As Premier Daniel Andrews works out how to pay for the recommendations made by the Royal Commission into Family Violence, housing and homeless experts have come up with an idea that could generate millions of dollars in additional revenue without hurting low-income earners: a vacancy tax.

The proposal — modelled on a similar levy used in Britain and Canada – would involve taxing thousands of houses or apartments that have been unfurnished and unoccupied for a long time, such as many investment properties that are lying idle in Docklands and other parts of the inner city.

The assumption is that many of the vacant apartments in Melbourne’s Docklands are vacant out of choice — that owners would rather just hold them for the capital gains rather than worry about dealing with renters.

There may be some truth to that. But that would be the minority. Anyone who has invested in Docklands, where property prices are stagnant at best, would have to be a lunatic for relying solely on capital gains.

The reality is that there has been such a proliferation of building in Melbourne’s Docklands and Southbank areas that supply far exceeds demand. And where there is demand, folks aren’t overly keen about renting a proverbial ‘shoe box in the sky’, just to be close to town.

Especially not when the more vibrant areas like St Kilda (south of the CBD), Fitzroy or Collingwood (both north of the CBD) offer much better options.

Your editor has made far too much of a fool of himself predicting a house price crash to risk our vanishing reputation on another prediction.

But, if the condition of the housing market right now doesn’t mean a crash is around the corner, then we’ll gladly hang up our ‘house price prediction boots’ for good.

Cheers,

Kris

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End of day market data

If you have any ideas about what you would like us to include in our end of day market data drop us a line at letters@portphillipinsider.com.au, and type ‘Market data’ in the subject line.

52-week highs: 48 stocks, including Eden Energy Ltd [ASX:EDE], Hazer Group Ltd [ASX:HZR], MACA Ltd [ASX:MLD], Pro Medicus Ltd [ASX:PME], Corporate Travel Management Ltd [ASX:CTD], Transmetro Corp Ltd [ASX:TCO].

52-week lows: 26 stocks, including 1st Available Ltd [ASX:1ST], Coventry Group Ltd [ASX:CYG], Peet Ltd [ASX:PPC], ZipTel Ltd [ASX:ZIP], and FarmaForce Ltd [ASX:FFC].

Note: The stocks listed above are stocks that hit an intra-day 52-week high or low during today’s trading. The stocks didn’t necessarily close at the 52-week high or low.