Charles K. Langford Inc. sends a weekly financial letter to all their clients explaining the current market situation and more.
Click here to access the most recent Financial Letter.
(An example of CKL's weekly Financial Letter)
Financial Letter - July 8th, 2018
179th Issue (since 01/24/2015)
The book “L’alchimie qui crée l’or – Le chasseur de tendances boursières II” is now online (Amazon.ca and the title) on Kindle. It is in French. The book is now a “bestseller” in the category business and finance. It's also available on all other readers platforms (Kobo, iBook, etc.).
A second book is now available on the reading software like Kindle, Kobo, iBook, etc. Its title is “The Trend Hunter” and it is in English.
The mean of return of portfolios managed by Charles K. Langford Inc. in 2016 has been 10.90% and standard deviation of 3.75, after trading commissions and ¾ of management fees.
The mean of return of portfolios managed by Charles K. Langford Inc. in 2017 has been 13.50% with a standard deviation of 4.65%, after trading commissions and ¾ of management fees. The large standard deviation is explained by options strategies that have given a higher return.
Market Risk (Systematic Risk)
The SPY sailed the twenty-seventh week of 2018 with strong tail winds closing the week at 275.42, a higher level than the previous week, but still lower than the high made at 278.23 (June 13). The VIX is comfortably low (when VIX goes down the SPY goes-up and vice versa – see chart n. 3). The volatility of VIX (VVIX – chart 4) show the fluctuations of VIX are at the same level than during the bull market of 2017 and January 2018: a positive sign. The long-term chart is showing more comfortable bullishness (see chart 2 - SPY - weekly). SPY attained a new historical high at 285.49 points on January 26, 2018.
The conclusion about this past week: the blue sky seems back again but the past history
The Langford Management
Presently our investments are in ETFs and ETN offering a high return, with a dividend yield between 5 to 10 % per year, at pro rata temporis, monthly. The market has still a strong positive bias. We don’t think for the moment to change the allocation because also the products with higher returns are also bullish.
In the USD accounts, still we have cash, in the form of FLOT, MINT, NEAR. In the CAD accounts, it is PSA or the equivalents. In the average, our portfolios are invested 60% in revenue and 40% in directivity.
In some, more aggressive accounts we have increased the capital synthetically with option strategies to profit of the actual upward strong momentum. In accounts that allow futures markets, we have futures contracts in long position on stock indexes.
Our portfolio management is always ad hoc, for each client. But also, we offer now five standardized mini-portfolios for clients interested:
A contrarian as a hedge or profit
Bullish and dividend oriented
Bullish, aggressive on non-traditional assets.
(The portfolio management fees of Charles K. Langford Inc. is 0.9% of assets, per year (equivalent to $900 per $100,000). The capital under management is invested exclusively in ETF, ETN and options)
Among a group of selected stocks and ETFs, the week just ended has given middle- and long-term buy signals for the following stocks and ETFs.
Investors that believe the current Canadian market offers interesting bullish opportunities, they can buy the call on BCE (it closed Friday at $54.57) August 17/50.00 @ $4.75 whose delta is 0.95 and gamma 0.03 (accelerator of delta). This call will offer a profit of 95% of the stock increase at a cost that is about 11 times lower than the present price. If the stock goes down, the maximum loss is the premium.
SPY - Daily - 2018/07/06
SPY - Weekly - 2018/07/06
VIX - Daily - 2018/07/06
VVIX - Daily - 2018/07/06