Ergomed Share Discussion Threads

[frankwhite] 29/10/2020 10:16

@tongosti, this could be the entry point you are looking for. Offer at 735p just now. I have topped up, so little volume moving the price.

[tongosti] 29/10/2020 09:19

Yep - unfortunately so pal. In my mind it goes to show why it is extremely important to stick to one's methodology and not get tempted to get in when own rules say no. I am patiently waiting it all out and hopefully a good opportunity to re-initiate will materialise soon. Good luck all holders.

[blueflame] 29/10/2020 08:48

Looks like it is ERGOs turn today.

[tongosti] 28/10/2020 16:18

Really really impressed with the price action especially in the context of wider markets taking a bath for a few days. Following v v closely with the view to reinitiate if and when the moment is right.

[tongosti] 13/10/2020 11:01

Agreed maddox - let’s see what the next few days and weeks will now have in store for us.

US indexes on fire at the moment (v overstretched shorter term though) and I do have 3800 as a target on SPX. If so, the whole equity complex should enjoy another leg up.

[maddox] 13/10/2020 10:40

I conceptualise it as a firm's value versus share price. Fundamentals provide insight into value only; whereas technical analysis is seeking insight into the market dynamic between buyers and sellers that determine the current share price direction.

So, by using both analyses you should get a more complete picture of the opportunity.

[tongosti] 13/10/2020 10:18

Thanks pal - I wouldn't read too much into GH selling. Sometimes divesting in the institutional space may have nothing to do with that holding per se but with different reasons related to fund's own rules on ind exposures / intended valuation profiles etc. Re chart reading - yes it is extremely important. Have to say that 99% of TA is mumbo jumbo but understanding the interaction between price and volume is key to timing. Took me years to get a reasonable grip on it all (and I will always be learning new things in this space no doubt about that). My own background is math and stats and i have tremendous respect for fundamentals but if I am forced I will always -without fail - go for price action. Am a firm believer in Price leading Fundamentals (not the other way around), most often than not. Beauty of it all is that there are a zillion ways (all equally difficult to find, am afraid) to skin the cat in this game. In my experience the key is to identify the one which best fits with who we are. Jack Schwager (of Market Wizards series) elaborates one this point much better than I can. Cheers and good luck.

[maddox] 12/10/2020 18:04

Hi tongosti,

Fascinating, sounds like a unique approach. I'm very much a fundamentalist - but trying to understand charts better - with a view to improving my timing. I don't think I'll ever just trust the chart signals.

>> and as I post Gresham House goes below 3% - so looks like they'll be out completely - may still have a rump to dispose of before we advance.

[tongosti] 12/10/2020 10:15

Thanks maddox. I think MM's method is applicable to the UK market as well with the main caveat being that UK Plc does not provide quarterly audited updates. It is an important drawback as one is not able to conduct the exact same fundamental analysis as is otherwise possible with US markets. In addition, the opportunity set in the UK is about 25% of what is available on the other side of the pond. To answer your question, I have an additional statistical overlay (on top of MM's method) which effectively works out the combination of the speed and and magnitude of market moves and then puts them in a historical context. In turn that helps assign trading odds. With ERGO, if one works out historical 10d rolling returns and then builds a probability distribution of them, you will see that the juncture we are at right now Is a very high probability area for at least a pause in immediate future performance. In other words, the chart is indeed v healthy as you described but overstretched in the shorter term, in my view. As my approach revolves around assigning odds to any new position I may want to initiate, I only take the ones where odds for an immediate thrust North are the highest. Personal preference and all but I aim for my positions to work off the bat with the view to move stops to BE as soon as possible. Again, no right or wrong in this game - pros and cons to the each different approach but here I go with mine.

[maddox] 11/10/2020 16:05

Thanks for your thoughts, and I respect your discipline.

I've read Minervini and even had a go at applying his methods - didn't work for me and I think that it's very US market centric. Nevertheless, can't argue with his success - remarkable. A few things out of his play-book might be of relevance here.

The chart as you say looks very strong, the advances are driven by a high volume of trading, whereas declines by very little volume. Minervini writes at length about not being misled by a high p/e and the fundamentals have significantly improved. On the other hand, some of ERGOs FIs seem to be selling down - Gresham House, Oryx and North Atlantic with Standard Life coming in. So it would be good to see some more evidence of FI buying.

Is there anything specific that you are looking for that would reduce the risk for an entry point?

[tongosti] 10/10/2020 08:21

To clarify on the technical point - I am not saying the chart doesn't look constructive. Actually, it is awesome. It is just that at this juncture I am not able to locate a low risk entry point hence I am waiting for some meaningful consolidation (if it ever takes place of course) before I may want to step in.

[tongosti] 10/10/2020 08:13

I am 100% with what you describe on the fundamental front so yes, ERGO looks set to be on the path of something special. Revenue / EPS / margin growth are some of the best in the business. No doubt about that. The reason that I am not in - at this particular point in time - is purely technical in nature. If you maybe aware of the likes of incredibly successful high growth company investors like William O'Neil or Mark Minervini - there's the answer to your question. Broadly speaking, a company may go up 500% from A to B. As I try very hard to avoid inevitable volatility in between those points (to me an account drawdown of about 10-12% max is a very, very serious concern) I am content at trying trading in and out several times during that A to B journey. Is it a precise science? Of course not - which inevitably mean that I will also miss good short term trading opps here and there. Still worth it though (for me) as that's the price I am willing to pay for managing risk. As a matter of fact, I am obsessed with controlling risk hence my preferred way of playing the game. Again happy for you and all holders - I will certainly join you in the journey multiple times in what is a phenomenal growth story.

[maddox] 09/10/2020 19:58

Hi tongosti,

What rules are you obeying that are keeping you out of ERGO?

We're at the start of the journey here. They have a solid underpinning of clients and contracts to which they are adding and highly attractive margins and cash generation.
The market is large and growing so that they have plenty of runway for rapid expansion. Richard Barfield exudes confidence, has a clear strategy and drive - and probably best of all - he's done it once before creating huge shareholder value.

Ticks in all the boxes - top quality.

[lucicavi] 08/10/2020 13:11

On the way to £10


JOUL stirring

[tongosti] 08/10/2020 13:07

Ok pal thanks - water under the bridge!Even through I am v tempted I am a sticking with own rules and giving this a miss. Will patiently await if and when another low risk entry point (for me!) shows up. Happy for you and all holders - there is most def more to come from ERGO!

[ihatemms] 08/10/2020 13:04

Thanks for setting up the thread Mirabeau! Sorry to hear you haven’t benefited from the work you put in for setting this up.

[mirabeau] 08/10/2020 13:00

25000 shares! That's too good fella. Superb


I set this thread up and Blue Prism and didn't buy either stock. What a muppet I am

[ihatemms] 08/10/2020 12:58

Tongosti- I wasn’t trying to be sarcastic.Sorry if it came across that way. I had hoped you’d got in when there was a slight dip. I think from the chart it’s a share to be held rather than traded but as you say everybody has their own methods. I also trade as well as invest .Wishing you all the success.

[tongosti] 08/10/2020 12:52

I am leaving your sarcasm out pal so maybe this will make you even happier: I am indeed missing the fun. I got out under 700 for a +30%. However, before you get too excited you have to know that I trade I don't invest. I may trade in and out hundred of times per annum. To me anything >30% is an outlier. Different game to most type of thing. I am happy for all holders as this share has much more to offer.

[ihatemms] 08/10/2020 12:52

Barfield’s only got this in 2nd gear at the moment. Wait till it hits 6th gear with the inevitable acquisitions and dividends.

[qvg] 08/10/2020 12:49

I was thinking of taking a few profits yesterday - glad I did not!

[ihatemms] 08/10/2020 12:47

Carries on at this rate prob hit £10 today!😎 Glad I’ve got 25000 of these and I have no intention of selling any for a good while yet.

[blueflame] 08/10/2020 12:30

I watched his interview on Sharesoc on Tuesday and like you say Barfield knows his stuff. He seemed very confident in the business going forward and I would not rule out more USA acquisitions in the near future followed by one of the big boys snapping up Ergomed in my opinion.

[mirabeau] 08/10/2020 11:12

Unstoppable but sadly not a holder

[mfhmfh] 08/10/2020 11:04

new highs now