The first quarter of the year is already behind us, with the market up just over 4% excluding dividends - not bad. The bigger event is that the new dividend withholding tax is now in force, so in a nutshell you'll now pay an effective 15% tax on declared dividends; with most companies only bulking up their dividends by 10% we'll be slightly worse off.
 
Other big news is the massive petrol price increase that took place last week. We found a chart comparing petrol and oil prices over the last six and a quarter years… pretty scary. You'll find it here.
 
In the week ahead we have a live webcast on Wednesday 11 April at 13h00, with a new presenter - Warren Peacock. He's a massively knowledgeable student on using harmonics for charting and his first webinar will be on Harmonic Trading; ab="CD". It’s a new way of looking at charts and the first in a series we're confident will be a huge boost to traders.

We'll also upload a update to the Momentum Portfolio Q1 2012, and it continues to be a winner, up over 10.1% for the quarter with the market return of 4.2%.

Coming up

Wednesday 11th at 1pm - Harmonic charting; ab="CD"

Wednesday 18th at 8pm - Valuations: EV/EBITDA Model (case study)

Recent uploads

Which chart to use?

Valuations - EV/EBIDTA

Money tip

This week we're linking to a Seth Godin blog post titled Making big decisions about money. It's a great post to help us understand how to make decisions about large financial transactions - the problem is we typically view them wrong.

All the best

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Investing does not have to be complicated; sure, we can make it massively difficult, but our updated Momentum Portfolio once again shows how a simple approach can reap rewards. The portfolio was up 10.1% in the first quarter of 2012, while the market added 4.7%. Two of the stocks in the portfolio delayed their dividends due to the new withholding tax, so it could have done even better (we will get the dividends in the second quarter so it's not a problem). The video is here.

In the week ahead we have Keith Mclachlan back with his case study on the Valuations: EV/EBITDA Model (case study) (he'll be using Famous Brands). The live webcast is at 20h00 on Wednesday 18 April. I had to watch the theory video twice to fully grasp the concept and it's well worth watching again before the case study. You'll find it here and the rest of the valuations series.

In the past week Warren Peacock also presented a webinar on Harmonic Trading, in the first of the series he covers the "AB=CD" principle. It is in a sense simplified Elliott Wave and I like the idea as it is more simple and very intuitive. You can watch the video here.

Coming up

Wednesday 18th at 8pm - Valuations: EV/EBITDA Model (case study)

Wednesday 25th at 6pm - FinWeek is hosting their popular BEE evening in Cape Town

Recent uploads

Harmonic Trading ab="CD"

Which chart to use?

Valuations - EV/EBIDTA

Money tip

I received one of those phone calls this week… you know the one. It comes from a blocked number and the caller starts by asking how you are and then gives some silly comment about your answer. Then they launch into their spiel and you know they're trying to sell you something that you don't want (if you wanted it you would have bought it already - surely?).

In this case they were trying to sell me a piece of software for the stock market. Apparently it would enable me to become fabulously wealthy with returns of some 40% every six months and I would get free training, all for some ridiculous amount of ‘only’ R14, 000 or something. My question was simple, if the software was so great why wasn't the agent making bucket loads of money rather than cold calling people? She also said the 40% every six months was guaranteed, so I asked for that in writing and I would send it to my lawyer - she hung up.

This is in short an absolute rip off. You can get excellent software for some $250 and most online brokers will offer it free to clients (and the free stuff is way more than most people need anyway). More importantly, there are exactly zero guarantees when trading or investing, unless you pay for them via a structured guaranteed product.

If you have R14,000 lying around looking for a home, rather put it to good use in an ETF, use your broker’s free software and educate yourself via JustOneLap and the numerous other resources available on the web.

All the best

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Stock markets are driven by headlines, hourly and daily headlines screaming about a 2% drop here and a 3% rise there. Do we care? Frankly as a saver or longer term investor one doesn't. Sure you're making or losing money but investing is a long march, a slow march. Don't get swayed by the short term noise in the market, keep an eye on your long term goal and always remember it'll take time to achieve those goals.

Today we have Alwyn Burger doing a webcast on Real live FX trading strategies at 20h00. His comment to me when wondering what topic to cover was that while a strategy is critical, most people only discuss them in vague terms; this doesn't help anybody trying to understand the entire process. So Alwyn will delve into some of his FX trading strategies so that you're better informed as to how to build your own.

In the past week Keith Mclachlan did the Valuations: EV/EBITDA Model (case study) webcast and it is now online for viewing/ downloading. This was one of the more complicated valuation methods that I initially struggled to get my head around, but I watched the practical again and this case study video using Famous Brands made a lot of sense.

Coming up

Monday 23rd at 8pm - Real live FX trading strategies

Wednesday 25th at 6pm - FinWeek is hosting their popular BEE evening in Cape Town

Wednesday 2nd May at 8pm - Simon's Lazy Trading System

Recent uploads

Valuations EV/EBITDA Model (case study - FBR)

Harmonic Trading ab="CD"

Which chart to use?

Money tip

One of the most frequent questions I get asked is how does one save for a child? I think it is a great idea to have a saving or investing account in a child's name as it helps make it more real for them. As he or she is a minor there is a process; if the child is below seven the account cannot be in their name and the parent or guardian can then open a separate account for the child (or children). Then when they turn seven one can (with parent or guardian consent) open an account in their name. The parent or guardian will be the one being FICA'd and if you are transferring shares or ETFs in the child's name there will be a 0.25% tax levied on the value of the portfolio.

All the best

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It was a rough week at JustOneLap head quarters (AKA my sunny office in Jozi) as tech issues meant we were not serving videos either for online viewing or for downloading. Fortunately things are back to normal and the videos are rocking again. We apologise for the troubles caused to your viewing pleasure. When we have tech issues we will always keep users informed on our Twitter and Facebook pages.

In the past week we had another great webcast from Alwyn Burger and this one focused on trading strategies, Real live FX trading strategies. The video includes some great ideas and there is also a PDF document that you can download on his micro strategy for FX trading.

Looking to the week ahead, on Wednesday at 20h00 I am doing a webcast on my lazy trading system (appropriately called - Simon's Lazy Trading System). This end of day system is designed for trading indices (Top40, Resi10, Indi25 or Fini15), with or without gearing, and generates around one trade per month - perfectly lazy albeit it's a trend system and markets have not been kind recently. It is also online here (login required).

Coming up

Wednesday 2nd May at 8pm - Simon's Lazy Trading System

Wednesday 9th May at 1pm - 4 Important candlestick patterns

Recent uploads

Real live FX trading strategies

Valuations EV/EBITDA Model (case study - FBR)

Harmonic Trading ab="CD"

Money tip

Buy in bulk. Yip, this old theory really does work. Rather than buying a week or months supply of whatever essential household product you need, buy enough for three, six or even 12 months supply; the savings per item seriously add up. The challenge is finding enough storage space, and of course perishables which this will not work for, but cleaning supplies and other such household products work perfectly.

The issue often raised is the larger upfront cost, so even at a cheaper per item price buying in bulk could be tricky if cash flow is tight. The solution here is to get together with friends, family members or even neighbours so that the initial outlay is smaller but the savings remain.

All the best

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