The markets are twisted, but are there bargins to be found?

PUBLISHED: 13 Feb 2012 @ 10:20 | Comments (0) | More info about Clem Chambers

So how is this euro crisis working out for me then?

Its all well and good writing investment books and being a pundit on global economics, but can you make money investing?

Having bailed a little bit late in the summer slump yet still missing a large chunk of the actual fall and all of the ‘virtual fall’ that could have been, I have been slowly sneaking back into the market.

I did so out of the pure force of addiction as equities are my favourite thing. I have only been buying extreme conviction value; that is to say stocks so cheap they should have resulted in my arrest for stealing them. Since September I’ve been picking off ‘bargains’ ending up with about 33% of my capital once more in play.

I still don’t like being in the market but currently I’m up 23% in 6 months on what I’ve put back in and on an average capital employed probably about a third ahead. Of course you could say I’m only 8% up on my full capital then I might say that was 16% annualised. In any event I have two points.

1) These markets are twisted. Twisted by governments on Kamikaze politico-econometric nose dives into the frigid unknown. I am therefore dancing while Rome burns or is that fiddling on the edge of a mixed metaphor, either way I feel I’m dicing with Darth? However the force is with me, for now.

2) Bull markets make every investor a genius, so I’m smart for now while the rally is hot.

Newish positions:
Name Weighting,
Cenkos, 1
Cable and Wireless,1
Enterprise Inn, 1
Transence Tech,1
Pendragon, 1
Tesco.1

Old Positions:
Findel,1
Game Group,2
Lloyds, 6
Mothercare,1
Pace, 5
Promethean,2
RM, 6
SSE, 2
Trinity Mirror,6

Weightings; the number is a multiplier of my unit of capital. So I’ve 6 times more Trinity Mirror than Mothercare. 37 units in 15 stocks. This should could as lightly diversified but should probably be considered undiversified value equity.

Profits so far:

Robert Wiseman Dairies RWD 46% –
Very lucky. Bought on 7% pre announcement spike, though had been watching this for a couple of months.

DTZ 16% –
General lunacy. This companies ending was a giant disgrace.

Lloyds 21% –
A large 15 unit punt. Sometimes you just have to. In at 28p out at 34. Position since built up again this time for longer hold.

MTC 4% –
Bought for a bounce that never came. Re-entry 25% lower.

No loses
Yet…..

I think 2012 will be a fine year but I’m still mainly in cash. But if directors buy their stock in beaten down shares I will be looking to take a unit of them and then buy more if they fall.

Meanwhile the portfolio I bailed on has only returned 50% more cash with 300% more money so my risk reward ratio is satisfying and breaking buy and hold rules hasn’t bit me yet.

CLICK HERE TO REGISTER FOR FREE ON ADVFN, the world's leading stocks and shares information website, provides the private investor with all the latest high-tech trading tools and includes live price data streaming, stock quotes and the option to access 'Level 2' data on all of the world's key exchanges (LSE, NYSE, NASDAQ, Euronext etc).

Follow @clemchambers

This area of the ADVFN.com site is for independent financial commentary. These blogs are provided by independent authors via a common carrier platform and do not represent the opinions of ADVFN Plc. ADVFN Plc does not monitor, approve, endorse or exert editorial control over these articles and does not therefore accept responsibility for or make any warranties in connection with or recommend that you or any third party rely on such information. The information available at ADVFN.com is for your general information and use and is not intended to address your particular requirements. In particular, the information does not constitute any form of advice or recommendation by ADVFN.COM and is not intended to be relied upon by users in making (or refraining from making) any investment decisions. Authors may or may not have positions in stocks that they are discussing but it should be considered very likely that their opinions are aligned with their trading and that they hold positions in companies, forex, commodities and other instruments they discuss.