P. 49

The price had peaked at just over 860, fallen back down through my moving averages to 830 (the green arrow marks the spot) and thus made my ‘take profit’ signal.
So far so good, at that point my Great British Trade Off portfolio was up 7.6% since April and I was showing a fair number of the clever people who was the ‘daddy’. But then I made an error and got wrong footed.
Beware of seductive ladies holding whips, the market
is a seductive lady always promising wealth and a whipsaw is a chart pattern that my system doesn’t cope well with.
This is what happened next.
The week following my profit taking, the chart made a buy signal (red arrow marks the spot) which I took. The thinking was sound, buying signal below the trend line in a decent uptrend, but with hindsight a big mistake.
started, and all four funds changed from being seductive pretty ladies I’d like to hold for a few months into old slappers I don’t want to be seen dead with.
My system gives me the discretion to override the chart signals if a sudden correction down is a general market move rather than being specific to my holdings and in this instance rightly or wrongly I didn’t sell when the stops were broken, I continued to hold.
Ten days ago, that looked the smart move, as I write today it doesn’t look so clever. If prices start falling away sharply again, I’ll sell and accept that I called the market wrong. The trick when its going wrong is not to be ‘billy big balls’ and as a result find yourself the wrong side of a big move.
But even after the drama of October, my GBTO portfolio is still up 3.9% since April at the time of writing, which
is pretty good bearing in mind all that’s happened. There will be some great buying opportunities coming up before we’re all much older and as I’m only 30% invested I’m in a good position to take advantage when they come. So there we have it, my battle with Fagin to see if trading or investing is the better way to generate wealth continues.
Yours, aye Humbug
To nod in admiration at the highs and secretly savour the lows visit The Great British Trade Off by clicking on the image:
     That was compounded because at the same time the Fundsmith Equity Fund, the Neptune Global Technology Fund and the Sarasin Food and Agriculture Opportunities Fund also all made the same buying signal that I also took.
This is what has happened since to the Baillie Gifford American Fund and the other three. The week after I’d bought £5k of each fund, the October correction
 49 DIY Investor Magazine | Dec 2018

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