These are trades I did following the March 2009 final collapse of the Bear Market in my Canada Stock Portfolio.
A stock market decline like that seen from Sept 2008 through into March 2009 are rare events. A decline that large usually is followed by a enormous run-up. It’s a rare chance to purchase stock at what I consider fire-sale prices and hold it for a few months without covered call writing and then sell the stocks for large profit gains.
It is for just such events like the 2008 to 2009 market collapse that I keep 30% of my entire portfolio waiting in cash. There have been opportunities to put my cash to work every few years and over the past 10 years this marks the second huge collapse in share valuations. It only takes a couple of events like these to make my cash holding very worthwhile. This is just one of the reasons why I believe in the importance of having a plan.
Once I buy the shares I picked up at amazing bargain prices I hold for a short period and then sell these shares and return my cash to its safe nest waiting for the next opportunity.
Naked Puts and Covered Calls work well, but in a rapidly advancing market following a huge collapse, I believe buying and holding stocks for a short period is best. The last such market rapid advance was in Feb 2003 where my returns on my cash were 58% on Canadian Stocks.
Understanding My Indicators
To understand the indicators I used to decide to go in and buy stock at this period, please read the timing indicators article within my USA Stock Portfolio since these are the same indicators I use for all market trends. Select this link to view that article.
Trades For March 2009 to July 2009 (Commission Included)
All Trades Are From The Toronto Stock Exchange and are in Canadian Dollars
|Date||Stock & Symbol||Action||Capital Invested
|Mar 10 09||ROYAL BANK OF CANADA RY||2000 Shares Purchased @ 30.10||$60,207.00|
|Apr 21 09||ROYAL BANK||Dividend 2000 X .50||$1000.00|
|Jul 23 09||ROYAL BANK||Dividend 2000 X .50||$1000.00|
|Jul 30 09||ROYAL BANK OF CANADA RY||2000 Shares Sold @ 51.00||$102,193.00||$41,986.00||69%|
|Mar 12 09||CIBC (BANK) CM||2000 Shares Purchased @ 42.10||$84,207.00|
|Mar 25 09||CIBC||Dividend 2000 X .87||$1740.00|
|Jun 25 09||CIBC||Dividend 2000 X .87||$1740.00|
|Jun 29 09||CIBC (BANK) CM||2000 Shares Sold @ 65.00||$129,993.00||$45,786.00||54%|
|Mar 23 09||QUADRA MINING QUA||3000 Shares Purchased @ 5.40||$16,207.00|
|Jul 24 09||QUADRA MINING QUA||3000 Shares Sold @ 10.00||$29,993.00||$13,786.00||85%|
|Mar 10 09||TALISMAN (OIL) TLM||1000 Shares Purchased @ 12.35||$12,357.00|
|May 27 09||TALISMAN (OIL) TLM||1000 Shares Sold @ 18.00||$17,993.00||$5636.00||45%|
|Jul 09||Total Dividends earned||Earned on above positions||$5480.00|
Total Capital Invested: $172,978.00
Total Dividends Earned: $5480.00
Capital Gain: $101,558.00
Total Capital Available: $280,016.00