Looking backThe 2012 results were not bad and the beginning of 2013 has been according to plan. The AEX index has been pretty volatile this year. Since the beginning of the year the index moved about 5% up and then about 7% down. Luckily my portfolio performed nice and steadily. Just to get an idea of my overall performance since I started investing according to my plan I pasted my performance graphs of 2011, 2012 and 2013 (provided by my broker) together.
|Blue line is my performance Nov 2011 - Feb 2013|
As of November 2011 my equity has grown steadily by about 11%. The only draw downs have been relatively small draw downs that were part of consolidation periods.
Looking aheadMy strategy is basically a fund picking strategy combined with strict position sizing and risk management So as long as I am picking the right funds and keep cutting losses in time I do not need to worry about the overall stock market outlook, right? Well, this is not entirely so. I am not hedging against market risk. I just look at fund performance numbers, get out when the numbers turn bad and move my money elsewhere or stay out of the market entirely. So it will help to formulate some general expectations on what the market will do. I mean, no one knows for sure what will happen, but there are some general rules of thumb concerning the flow of the markets. My way of looking at the markets is to just glance at daily candle stick charts with the Ichimoku cloud.
My expectations for the coming months are that the European stock markets will move significantly lower. US markets will become more volatile while moving side ways and the Japanese stock market will at least see a correction to the downside before it might continue higher. My benchmark, the AEX index, will, if it breaks below 335 move on down to find first support at 320 and then at about 310.
This is my outlook for until may 2013.
|NL25 or AEX index, break below 335 --> more down side with first support at 320|
|Europe 50, definitely more down side if price breaks below the kumo|
|Japan 225 - is overdue for a correction. Will probably find support at the kumo|
|SPX500 - widening kumo indicates more volatility ahead. First strong support is at 1466|
Once again, I write this down as it helps me in making my own investment decisions. This post is not an advise to buy / sell financial products. I just hope it inspires others to do the same and make their own analysis and have good luck and fun investing.