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Interview with Ron
(Sept 20, 2002) How
he started in the stock market and in technical analysis: Ron
started off in the stock market industry as a filer of companies' Extel
Statistics cards at a London
brokerage house named Laing and Cruickshank (presently, Credit Lyonnais)
during the 60's. Through his photographic memory, he was able to learn
information about these listed companies. He worked there for a
couple of years working his way up to be the head of the Trustee
department. Among his responsibilities was to manage the discretionary
equity funds of Agatha Christie, Cadbury's Chocolate, General Electric,
Express Daily and British Leyland Motors,
among many others. In 1974, he transferred to a smaller investment firm
to be a Technical Analyst, wherein he followed the daily movements of
the 625 listed companies in the all-share index in the London stock
market, as well as some American and South African gold mining
companies. Persons
who influenced his way of thinking:
The
old Technical Analysts such as John Murphy, Martin Pring, Welles Wilder
and Edwards & Magee.
Some of his thoughts regarding
Trading and Technical Analysis:
He says, "...if you want to
be a successful Technical Analyst, you have to look at the big picture.
This means you have to take a big interest in what's happening in
America because it's the leader. Where America goes, everybody else
eventually follows."
In trading, he uses Intuition more
than his system.
He says, "I will allow my
intuition to rule the day because it is right 90% of the time."
He also says, "Intuition is
simply the experience which you've ever had fed into your subconscious
mind which is able to reach a conscious decision."
He also says, "If you buy a
stock and it doesn't move for 3 days, you should sell it."
He also says, "Averaging down
must be punishable by death."
He also says, "If you have a
bid-offer price and you are sure the shares are going up, there isn't
any point in posting in the bid side."
He also says, "Intra-day
traders don't make money unless they are geniuses."
Best
Trades:
In
1996, Ron bought P2.5 million worth of Ever Gotesco at P0.19. He sold
everything on the same day at P0.29. A whopping 52% increase in capital
in just one morning.
Recently,
he bought 100,000 shares of FPH at P10.50 and sold everything at 14.25.
Worst
Trade:
He
went long in Ebecom at P0.19 based on a "hot tip". The next
day, the bid was doing at P0.10. He was able to sell his holdings only
one year after at P0.16. Shortly after he sold, the stock went to P1.00.
How
he manages his portfolio:
He
never holds more than one stock at a time.
He
believes in putting all his money in just one stock...but he doesn't
encourage his clients to do that. Instead, he advices to spread their
portfolio to 5 or 6 stocks but not more than that.
He
advices to stay out of illiquid stocks.
Learn
more about Ron |
