vectorvest09:00 welcome and introduction ... franking (imputation) credits •tax credit •paid by...
TRANSCRIPT
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2017, Copyright VectorVest, Inc. ALL RIGHTS RESERVED. No part of this publication may be reproduced in any form or by any means without the prior written permission of the publisher and the copyright holder, VectorVest, Inc.
Special Notice
VectorVest, Inc. will do everything it can to insure the safety of your personal possessions while you are attending the Seminar. If you would like us to watch your computer during lunch, please take it to our registration table, where you will receive a claim check for it. In any event, we cannot assume any responsibility for lost or missing personal property.
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VectorVest
Welcome and Introduction
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About VectorVest
Stock Analysis & Portfolio Management Software provider
• In Business 30 Years
• Fourteen Countries (AU 1800 shares, USA 9000, Total 23 000)
• Software
Mathematical, Rules based
Uses combination of fundamental and technical for share analysis
Integrates this with a unique market timing system….
To give share portfolio management tools to help subscribers decide when to buy shares, which shares to buy and how to manage their share portfolios using a variety of risk management techniques
PowerPoint Slides
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PowerPoint Slides
To get a copy of these PowerPoint Slides
Place In Browser:
www.vectorvest.com/e‐reports/event/AUWorryFreeInvesting.pdf
Safe Shares are necessary in this Market
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Share Market Risks in 2017
Overall—expect more volatility and risk in 2017
• Global
Trump/USA
China
Brexit
EU
Other‐Russia, Japan, Iran
• Local
Political Environment
Debt, Budget Deficit, AAA Credit rating
Inflation, Interest Rates, Company Earnings
AUD/USD
Property vs Shares vs Bonds
Typical SMSF Share Portfolio
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Performance of this Portfolio
NAB RESEARCH
• One in two Australians falling short on wealth goals
• 50 per cent blame lack of confidence
• One in four have a plan to save and invest
• Funding a desired lifestyle was key objective
• On average require about $800 000 investments (excluding home equity)
* MLC Wealth Sentiment Survey Dec 2016
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There are Opportunities
USA is going well
• Pro Business President and Administration
• Anecdotal feedback from small and medium business owners
• Lower company & individual tax rates
• Infrastructure Investment
USA Share Market
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There are Opportunities
Australia• Positive outlook from RBA• According to FN Arena:
Over the past 4 months
Hefty profit upgrades by analysts Average EPS forecasts for the share market in 2017 increased from 6‐
7% to between 13‐19% A big chunk of this growth won't show up until the August reporting
season, but even so the underlying trend is firmly upwards and by then the average might well be a lot higherIf these numbers still stand by the end of August, the Australian share market might well be about to experience its strongest year for profit growth post‐GFC
• Commodities/Resources Sector• Shares with USA exposure
Global Factors will continue to create volatility which increases risk
But in this environment, with the right tools, you can capitalise on the opportunities to Maximise Returns and Minimize/Manage Risks created by expected volatility
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WFI Terminology
• Minimise Risk‐‐Capital Preservation Safe Shares ‐ strong financial performance (strong fundamentals)
Safe Shares ‐ stable price pattern (strong technical)
• Maximise Returns‐Growth and Income Safe Shares that are undervalued, going up in price with potential for
further Capital Appreciation
Safe Shares with Safe, Reliable Dividends with Franking credits
Safe Shares with growing dividends underpinned by growing earnings
Worry‐Free Investing
You need the Best Investing Tools available to suit your:
Investment Objectives
Investment Style
Risk Appetite
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Worry‐Free Investing Agenda
09:00 Welcome and Introduction
09:10 The VectorVest System For Analyzing Shares
09:30 Assessing the Health of Your Portfolio
09:45 When to Buy Shares and When to Protect your Portfolio
10:15 Break
10:45 Replacing the Losers with the Best Worry‐Free Shares
11:15 Build and Manage a Worry‐Free Portfolio in all Market Conditions
12:15 VectorVest Coaching, Support and Training
12:30 Adjourn
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Worry‐Free Investing Workshop
The VectorVest System
for Analyzing Shares9:10am ‐ 9:30am
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The VectorVest WFI System
VectorVest believes in:
Buying safe undervalued shares rising
in price in rising markets and
protecting your portfolio in falling
markets.
The VectorVest System
VectorVest believes every Investor should know:
What a share is Really Worth.
How Safe it Is.
When to Buy, Sell or Hold.
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VectorVest Share Analysis Technique
1. Spread Sheet Analysis‐snap shot
2. Graph Analysis‐trend
1. Spread Sheet Analysis
For Definitions, right click on any share to “View Full Stock Analysis Report”
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1. Spread Sheet Analysis
To change Spread Sheet Columns, right click on any share & choose “layout”, highlight indicator & move up, down, left or right
Value
Value is computed from:Forecasted earnings per share
Forecasted earnings growth
Profitability
Interest rates
Inflation rates
Undervalued shares are preferred to overvalued shares
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Relative Value
An Indicator of Long‐Term Price
Appreciation Potential
Price, Value, Earnings Growth, Relative Safety
(Risk), and Corporate Bond Rates are used to
compute Relative Value.
Relative Safety
An Indicator of Risk
Consistency and Predictability of Financial
Performance are the Primary Factors in
Assessing Relative Safety.
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Relative Timing
An Indicator of Short‐Term Price Trend
The Direction, Magnitude and Dynamics of Price
History are used to determine Relative Timing.
VST ‐ Vector
The Master Indicator
VST‐Vector combines RV, RS and RT into a single
comprehensive indicator.
This combination incorporates both fundamental
and technical analysis.
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Stop Price
An Indicator of When to Sell or
Cover a Position
A 13‐Week Moving Average of Closing Prices
adjusted for the fundamentals of RV and RS is
used to compute Stop‐Price.
*Analysis as of 07/03/2016
Company Sym. Price Value RV RS RT VST STOP REC
A2 Milk Co A2M.AX 3.88 3.05 1.51 1.18 1.72 1.50 3.31
Com. Bank CBA.AX 82.24 56.65 0.95 1.31 1.09 1.13 77.79
TPG Telecom TPM.AX 5.58 8.76 1.44 1.02 0.79 1.09 5.59
Shares Ranked by Recommendation
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The VectorVest System
Buy, Sell or Hold Criteria
1. Price > Stop Price
2. VST > 1
3. RT > 1
4. Price must be diverging away from Stop Price
Price < Stop Price
Price > Stop, but any one of the other three
factors needed to receive a Buy are not met.
Comfort Index
An Indicator of Long Term Price Stability
Reflects a stock's ability to resist severe and/or lengthy price declines
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Earnings Per Share (EPS)
Leading 12 months Forecast Earnings Per Share
Determined from a combination of :
• Recent earnings performance and
• Traditional fiscal and/or calendar year earnings forecasts.
Earnings Growth Rate (GRT)
Reflects a company's one to three year forecasted earnings growth rate in percent
per year.
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Dividend Growth
Forecasted annual % growth rate of a company's dividend based on historical
dividend payments and dividend predictability
Dividend Safety (DS)
An indicator of the assurance that regular cash dividends will be declared and paid at current or
higher rates for the foreseeable future. Shares with high DS values have shown consistently strong
financial performance and including solid cash flow.
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Franking (Imputation) Credits
• Tax Credit
• Paid by issuing company
• Can add 2‐3% to dividend return
2. Graph Analysis
VectorVest Simple Rules
– Smooth rising left to right price patterns
–Respect of stop line
–Rising RT
–Rising EPS (The engine of share price growth)
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Worry‐Free Investing Workshop
Assessing the Health of
Your Portfolio9:30am ‐ 9:45am
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Create a Watchlist of Your Shares
Use Watchlist to Analyse your Shares
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Using QuickTest Tool
Use QuickTest to Count Winners & Losers and measure raw performance.
Use Graphs to Complete Your Share Analysis
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Analysing your Shares
Good Shares• Undervalued (Price<Value)
• RV>1
• RS>1
• RT>1
• VST>1
• B rated
• CI>1
• Growing Earnings per Share
Use Graphs to Complete Your Share Analysis
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Use Graphs to Complete Your Share Analysis
VectorVest Simple Rules
– Smooth rising left to right price patterns
–Respect of stop line
–Rising RT
–Rising EPs (The engine of share price growth)
Example of a Good Graph
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Example of a Bad Graph
Cleansing your Portfolio
Identify the shares dragging your portfolio down by re‐ranking WatchList by RT
The underperformers are those with:
– RT < 1
– REC = S
– To confirm underperformance, graph each share using VV Simple graph layout
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Worry‐Free Investing Workshop
When to Buy Shares
and When to Protect
Your Portfolio9:45am ‐ 10:15am
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Big Mistake Investors Make:
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Market Direction
Direction is the key to making money in any market.
“Being on the wrong side of the market is the worst thing that can happen to an investor. It
doesn’t have to happen to you.”‐ P. 70 ‐ Stocks, Strategies and Common Sense
Market Timing Graph
Used to Help you Decide When to Buy Shares (and When to Protect Your
Portfolio)
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Worry‐Free Market Timing
Market Timing Graph
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Worry‐Free Market Timing
The Worry Free Investing makes use of the Confirmed Signals
1. The confirmed signal is our most conservative market signal
2. You will get into the market when uptrend established and out of the market when downtrend established.
3. By using confirmed signals you are less likely to experience false signals from the market
4. Let the winners run and protect your portfolio by money management/stop losses.
Most Frequently used Market Timing Signals
Confirmed Signal (most conservative)– We will use this Signal for Worry Free Investing. – For Buy Signal Confirmed Up plus Green light in price column– Protect Portfolio on Confirmed Down
DEW Signal (Protrader Technical)
GLB/RT Kicker Signal (Technical)– Uses 5 and 20 day simple moving average of RT. – Buy Signal when 5 DMA> 20 DMA plus Green light in price
column – Protect Portfolio on Confirmed Down
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VectorVest
Break
10:15am – 10:45pm
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Worry‐Free Investing Workshop
Replacing Losers with
the Best Worry‐Free
Shares10:45am – 11:15am
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Finding Replacement Shares
• Know your investment style and risk appetite
• Make sure the market is going up!
• Analyse Shares using VectorVest Indicators and
Graphs
Finding Replacement Shares
Investment Styles & Strategies
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The VectorVest WFI System
VectorVest believes in:
Buying safe undervalued shares rising
in price in rising markets and
protecting your portfolio in falling
markets.
Managing Market Trends
How it Works:BUY SAFEST
STOCKS
DON’TBUY
S E L L S T O C K S W H E N S T O P P E D O U T
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When to Buy Shares
• Confirmed Up Signal
• Green Light in Price Column of Color Guard
What Shares to Buy
Stock Viewer Spreadsheet Analysis
• Preferably Undervalued
• RS>1 (RS is the key for Worry Free Investing!)
• VST>1
• B Rated
• CI>1
• EPS>O
• DY, DS>50, DG>0
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Finding Replacement Shares using Stock Viewer
What Shares to Buy
VectorVest Simple Graph Analysis
– Smooth rising left to right price pattern
–Respect of stop line
–Rising RT
–Rising EPS (The engine of share price growth)
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Using VectorVest Simple Graph
Safe Shares‐Earnings Consistency
• The single most important factor in assessing stock safety Dr. DiLiddo – Stocks, Strategies and Common Sense
Pg. 31
• Companies with a record of consistent predictable earnings are less risky
• Correlation between Price Stability and Earnings
• Earnings underpins Dividend Safety
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Earnings Consistency Graph Analysis
Safe shares have Earnings Consistency
Earnings Consistency Graph Analysis
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Earnings Consistency Graph Analysis
Unsafe Share‐Earnings Problem
Correlation between Long Term Price Stability and Earnings
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Correlation between Long Term Price Stability and Earnings
Correlation between Long Term Price Stability and Earnings
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Strong Earnings Underpin Dividends
Falling Earnings and Dividend Sustainability
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Graph Analysis‐Sustainable Dividend?
Graph Analysis‐Sustainable Dividend?
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Graph Analysis‐Sustainable Dividend?NAB profit edges down in December quarter‐unaudited cash earnings fell 1% in Dec 2016 quarter (07 February
2017)
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Worry‐Free Investing Workshop
Build and Manage a Worry‐Free Portfolio in all Market Conditions
11:15am – 12:15am
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Managing a Worry‐Free Portfolio
Money Management Rules
– Never risk more than 1‐2% of your capital
– Spread risk evenly across shares
– No more than 2 shares per industry
– Buy into rising market one at a time
– Never give back more than 50% of your profit
Never risk more than 1% of your capital
$100 000 x 1% = $1 00010 Positions of $10 000 each$ 1000/$10 000=10% stop Loss
$100 000 x 1% = $1 00020 Positions of $5 000 each$ 1000/$5 000=20% stop Loss
$50 000 x 1% = $5005 Positions of $10 000 each$ 500/$10 000=5% stop Loss
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Tools used to Manage a Worry‐Free Portfolio
Watchlists
Graphs
Managing a Worry‐Free Portfolio‐Graph
Graph using VV Simple High alert– Volatility– Falling EPS Action triggers‐4 Step Method of Portfolio Management– Falling price: 1st warning– Cuts 40 DMA: 2nd warning– RT<1: 3rd warning– REC=S: 4th and last warning
Act on appropriate warning depending on your risk appetite, but most investors would get out on 2nd or 3rd warning and not leave it until REC=S which is the last resort
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Managing a Worry‐Free Portfolio‐WatchList
Example: Managing a Worry‐Free Portfolio
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Replacing the Losers
Golden Rule: Only Buy Rising Shares in Rising Markets
Step 1: Go to Market Timing Graph to get Market Direction, and if OK..
Step 2: Go to Stockviewer to find Replacement Shares & Graph them
The Most Common Mistake New Subscribers Make
Go to StockViewer and Buy Top B Rated Shares without doing anything else No checking what the market is doing (Market
Timing)
No Spreadsheet and/or Graph Analysis
No 4 step management rules or stop losses
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Example for Discussion
Example for Discussion
Buy Top 2 StockViewer Shares on C/Dn 24‐5‐17 Buy Top 2 StockViewer on C/Up 14 Dec 16
Hold until 21 June Hold until 24 June 17
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What Investors Should Do Before Deciding to Buy
1. Check What The Market is doing ‐‐ensure:
Confirmed Up
Green Light in Price Column of Color Guard
2. Then Go to StockViewer and perform:
Spread Sheet Analysis
Graph Analysis
3. Ensure Shares meet your Worry Free Criteria before final decision
4. Ensure you use 4 step management rules or put your stop losses in place
Final Wrap upMinimize Risk (Capital Preservation) & Maximise Returns
(Growth & Income)
Buy safe undervalued shares that are rising in price in Rising Markets with:
• The potential to go up in value
• Good fundamentals (especially earnings)
• Stable price patterns (strong technicals)
• Reliable, Growing Dividends with Franking Credits
Always Use
• Spreadsheet Analysis
• Graph Analysis
Keep It Simple
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Worry‐Free Investing Workshop
VectorVest Coaching, Support & Training
12:15pm
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Resources for Your Success
1. Welcome Tab – Interactive Tutorials and Videos
2. Training Tab – 3 Quickstart Videos, Help Files, VectorVest 7 Quick
Reference Guide
3. Personal Coaching – Recommended after you complete the above
4. Webinars – www.vectorvest.com.au/Events
5. VectorVest University – SOTW and other Training Videos
6. User Groups – Check Locations and Dates Friday’s in Views
7. Dr. DiLiddo’s Little Green Book – Stocks, Strategies and Common
Sense
8. Support and Training – Call 1800‐303‐782
Home Page
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Training Tab
Mission Statement
Our Mission is to provide the best stock market guidance available anywhere at any
price.
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VectorVest Contact Information
Seminars: 1800‐303‐782
Product Support and Training:
1800‐303‐782
E‐mail: [email protected]
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VectorVest
Adjourn
12:30pm