CFD Trading Report Monthly Wrap, a detailed look at where we made and lost money during the month.
In an attempt to improve our service, we will now report our performance on a monthly basis, dividing our trades into three portfolios, Australian Stocks, UK Stocks, and Global Markets, which comprises commodities, currencies, bonds, and US indices. Going forward, we will report overall portfolio results for each of the three trading accounts, each in their home currency, AUD, GBP, and USD.
For each trading portfolio, we will provide
- A table of the closed trades from the month, with a combined Profit and Loss (P/L)
- A Portfolio Performance Table. The information in this table is rolling, i.e. the trades for the month are added to this table on a continuous basis. This table contains trades that were opened after 1 Dec 2008.
Below are a few notes which provide further explanation.
Current Account Balance – includes all closed trades from 1 Dec 2008 to the current month end
Overall Return – Total P/L to date, as a percentage of our starting balance
Win % - Percentage of trades where we book a profit
Scratched Trades – Trades where we were stopped out at break even
Max % Drawdown – This is the maximum amount, in percentage terms, in which our account decreases from our maximum equity line. Graphically, it is the maximum distance between our Maximum Equity (Pink) Line and our Current Account Balance (Blue) Line in the chart below.
AU Equities – August 2009
As usual, we begin the Monthly Wrap will a look at the Australian Equities account.
As evident from the table below, there were 9 trades closed out in the month of August. From these 9 trades, we booked 5 winning trades, 3 cost us capital, and 1 trade, Invocare (ASX: IVC) we exited at breakeven.
In summary, we made $3,430.16 for the month, which was a monthly return of 4.9%.
To the overall trading account, and after eight months of trading, the Australian Equities account is currently sitting on a capital return of 47%, with a win rate just below 64%.
Closed Trades for August 2009
Portfolio Performance from 1 Dec 2008
Equity Chart from 1 Dec 2008
UK Equities – August 2009
Now to the UK Equities account. During the month of August, we closed out six trades, four of which were winners, while one leg of our Micro Focus International (LSE: MCRO) and Caledonia Investment (LSE: CLDN) cost us money.
From an accounting perspective, this portfolio yielded a positive return of £575.70, which gave us a monthly return of 2.73%. Although this return was below July’s of 5.04%, it rounds off the second consecutive month that our UK account has risen in value.
Closed Trades for August 2009
Portfolio Performance from 1 Dec 2008
Equity Chart from 1 Dec 2008
Global Markets – August 2009
After booking a small profit on the GBP/USD early in month, we lost money on both the EUR/USD and Spot Gold trade. In all respects, we were a little unlucky with the gold trade, being stopped in right on the high. In hindsight, we were actually a little early with the recommendation. You will have noticed that we have since placed (and entered) pretty much the exact same trade, and with the gold price probing the US$1000 mark, well in the money.
In total, we lost US$405.5 for the month, which was a monthly return of -1.4%.
In regards to the overall portfolio, the Global Markets account has a return on capital of 14.17%, and a win ratio of 65%. Encouragingly, the maximum account drawdown remains very low at 4.78%.
Closed Trades for August 2009
Portfolio Performance from 1 Dec 2008
Equity Chart from 1 Dec 2008
The Month Ahead
Before we discuss the month ahead, we are going to mention two words. We highly recommend that you print these in a large font and stick then on your office wall. They are…..
- PATIENCE
- DISCIPLINE
With that out of the way, we can now discuss the gold market, a sector we believe offers great potential over the coming months. Although we have refrained from harping on about this trade too much, you have probably guessed our outlook from our current trade recommendations and open positions. On the metal itself, we have already bought at $972.35 and $992. In addition, we will add to this position on a break of $1008 and US$1025. In addition, we are long several precious metal mining companies, including Randgold Resources Ltd (RRS) and Fresnillo Plc (FRES) in the UK, and Dominion Mining Ltd (DOM) and Pan Australia Ltd (PNA) in the Australian market. In addition, we have a recommendation pending for Kingsgate Consolidated Ltd (KCN), as well as several other gold miners on our watch list, including Lihir Gold Ltd (LGL), Newcrest Mining Ltd (NCM), and Avoca Resources Ltd (AVO).
As evident on the chart below, the gold price has recently broken out of a large symmetrical triangle, which has formed below major resistance. In our opinion, this pattern has potential to support a sustained push towards the US$1100 level over the coming weeks, as a minimum.
Now, before you get too excited, nothing in the markets is a certainty, nothing. For this reason, trade appropriate volumes and always remember PATIENCE and DISCIPLINE!
Happy Trading!