Shares to watch

Wattie

Member
Messages
8,640
What masks did you buy? I'm curious? Link?
C
N95.
65125

If we ever have to wear them, the little uns out of school, housebound with the Mrs and I am down at Coles in this and goggles, with a full Stolichnaya vodka bath on my successful return!
 
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Wattie

Member
Messages
8,640

midlifecrisis

Member
Messages
16,102
Reading the VARIOUS reports from China, those people who have died had other medical complications. Poking my head into the south terminal today, I saw a few people wearing face masks.

Clearly shares in PPE manufacturers are the ones to buy thanks to the hysteria.
 

Wattie

Member
Messages
8,640
Hysteria or not, I’ll grab a life vest for the family and then watch what transpires.
 

Wattie

Member
Messages
8,640
Or you'll grab what you've been told is a life vest....

C
Well it’s better than nothing and for £50 who cares: sounds like I’ve got more than most.
It’s also a little odd that you’re critiquing my choice, when according to you there’s nothing to be concerned about.
 
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Wattie

Member
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8,640
I read that Boots has sold out of masks and Australia has today stopped all flights to /from China for 14 days.
Someone somewhere is clearly worried by this.

This ain’t the Flu.

 
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Zep

Moderator
Messages
9,110
All I can say is that if it is a bio weapon, it’s not a very good one. Spanish Flu (a non-engineered virus) infected 500 million people and killed around 10% of those infected. And that was in 1918, when we didn’t have air travel etc. At the moment there are 11,000 cases and 300 deaths.

More people are killed every day by accidents, especially in China, so while it might be prudent to take precautions the risk is clearly still quite low and Daniel Ivandjiiski can keep his particular brand of hysterical “Alternative-learning”.
 

MaseratiGent

Member
Messages
162
In terms of shares it might be worth avoiding the insurance and re-insurers.

Already supply chains for global electronic brands are being dented and it will take at least 1Q for that pain to be felt in results - if things do not get worse.

I was short Hang Seng as a proxy for China on Friday and a small basket of S&P and DAX and was pretty limit short going into the close (no trading over the weekend but only bad news could come). I'm going to go increasingly idiosyncratic this week - short insurers and some airlines. I expect a short squeeze early Monday hours and reset shorts on that relief.

As for this iteration of Coronavirus https://www.worldometers.info/coronavirus/ it has been growing (reported cases & deaths) at a 25% daily rate roughly. This assumes you do not believe the Chinese government is under reporting (which credible HK sources say China is under reporting). The rate of growth has slowed but that has been at the untenable cost of a 'lockdown' on 60m people around Wuhan.

If we look at 14 days and 28 days forward based on this optimistic/low reporting:
Cases = 14,000 * 1.25 ^ 14 = 318,300
Deaths = 305 * 1.25 ^ 14 = 6,930

Cases = 14,000 * 1.25 ^ 28 = 7,237,830
Deaths = 305 * 1.25 ^ 28 = 157,681

If we look at 38 days less optimistic numbers - say 40% daily growth as lockdowns fail:
Cases = 14,000 * 1.40 ^ 38 = 7bn = world population
Deaths = 305 * 1.40 ^ 38 = 152.5 million
 

Froddy

Member
Messages
1,072
I was short Hang Seng as a proxy for China on Friday and a small basket of S&P and DAX and was pretty limit short going into the close (no trading over the weekend but only bad news could come). I'm going to go increasingly idiosyncratic this week - short insurers and some airlines. I expect a short squeeze early Monday hours and reset shorts on that relief.

I totally agree with your approach, MaseratiGent - I think the shorts are at risk of getting their heads ripped off this week. The put/call ratio on the S&P has shot up (meaning most retail traders are short) and, on the last 2 occasions this has happened, the market has rallied (the red line represents the S&P relative to the put/call ratio).

That's not to say that it will again, but the conditions are ripe. As I pointed out on Friday, on this side of the pond the FTSE is at trendline support on the weekly chart.

As for the Hang Seng, this is seriously oversold on the daily chart, another red flag for the short squeeze you have described


Good luck this week!
 
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MaseratiGent

Member
Messages
162
I used to be a prop trader at one of the investment banks. I had a £1bn book to trade with until Dodd-Frank was implemented and I was mostly credit focussed. Notably I was the only trader on the floor short from Feb/March 2007...not that I got paid for it!

I dabble now and again a bit PA now when it's fun. I haven't looked at the vol surfaces but I suspect well OTM puts are worth a punt...despite a lot priced in.

The 31st had a lot of noise: month end redemptions/vs pent up by need by PMs, and small risk of 'turn' funding sell-off effects.
 

Froddy

Member
Messages
1,072
I used to be a prop trader at one of the investment banks. I had a £1bn book to trade with until Dodd-Frank was implemented and I was mostly credit focussed. Notably I was the only trader on the floor short from Feb/March 2007...not that I got paid for it!

I dabble now and again a bit PA now when it's fun. I haven't looked at the vol surfaces but I suspect well OTM puts are worth a punt...despite a lot priced in.

The 31st had a lot of noise: month end redemptions/vs pent up by need by PMs, and small risk of 'turn' funding sell-off effects.

WOW! Total respect. Glad I agreed with you!!!

OTM puts are definitely worth a go - have Feb (3000) and May (2000) SPX put butterflies in place, together with a Feb TSLA 585 (gap fill) butterfly. You never know ... !
 
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Wattie

Member
Messages
8,640
I totally agree with your approach, MaseratiGent - I think the shorts are at risk of getting their heads ripped off this week. The put/call ratio on the S&P has shot up (meaning most retail traders are short) and, on the last 2 occasions this has happened, the market has rallied (the red line represents the S&P relative to the put/call ratio).

That's not to say that it will again, but the conditions are ripe. As I pointed out on Friday, on this side of the pond the FTSE is at trendline support on the weekly chart.

As for the Hang Seng, this is seriously oversold on the daily chart, another red flag for the short squeeze you have described


Good luck this week!
China has apparantly just banned selling......
 

Wattie

Member
Messages
8,640
In terms of shares it might be worth avoiding the insurance and re-insurers.

Already supply chains for global electronic brands are being dented and it will take at least 1Q for that pain to be felt in results - if things do not get worse.

I was short Hang Seng as a proxy for China on Friday and a small basket of S&P and DAX and was pretty limit short going into the close (no trading over the weekend but only bad news could come). I'm going to go increasingly idiosyncratic this week - short insurers and some airlines. I expect a short squeeze early Monday hours and reset shorts on that relief.

As for this iteration of Coronavirus https://www.worldometers.info/coronavirus/ it has been growing (reported cases & deaths) at a 25% daily rate roughly. This assumes you do not believe the Chinese government is under reporting (which credible HK sources say China is under reporting). The rate of growth has slowed but that has been at the untenable cost of a 'lockdown' on 60m people around Wuhan.

If we look at 14 days and 28 days forward based on this optimistic/low reporting:
Cases = 14,000 * 1.25 ^ 14 = 318,300
Deaths = 305 * 1.25 ^ 14 = 6,930

Cases = 14,000 * 1.25 ^ 28 = 7,237,830
Deaths = 305 * 1.25 ^ 28 = 157,681

If we look at 38 days less optimistic numbers - say 40% daily growth as lockdowns fail:
Cases = 14,000 * 1.40 ^ 38 = 7bn = world population
Deaths = 305 * 1.40 ^ 38 = 152.5 million
Let’s hope your virus figures never materialise.......
 

Wattie

Member
Messages
8,640
Gold has hit the 1.272 fibonacci extension of the prior swing low and shows no sign of stopping. The next target is the 1.618 extension at c. $1,629 on the weekly chart.


ABBV has formed a perfect rounded top pattern - if the pattern completes (by a break below 80.45), this is extremely bearish. What's interesting about this chart is that price has breached a confluence of the 34 and 55 EMAs which should have provided strong support, and it's breached on strong volume. Earnings are announced in 7 days, so I'd just watch for now ...


There's definitely room for the FTSE to go lower next week as we have not yet hit the lower keltner channel (blue arrow). But be very careful as price is at the lower end of an upward trending channel (the red line) and may well bounce next week to crucify the short-sellers.


It's a brutal market - be careful!!!

 

Froddy

Member
Messages
1,072
China has apparantly just banned selling......

That's interesting - tomorrow could be "margin call Monday" in other geographies perhaps, which will accelerate selling as people desperately try to get out of their positions.

MaseratiGent what's your take on this? ...