Results trades, UK stocks

tomorton

Legendary member
8,399 1,338
Here's a simple strategy that I am using in spreadbetting UK stocks.

The idea is to get long on companies with bullish share price uptrends a few days ahead of their calendared results announcements. I've found it useful to set a SL at Entry minus 1 x ATR14 and a TP at Entry + 1.5 x ATR14, with a position size currently at 1% of account capital.

I'm using the daily news update in my trusty Sharescope to identify potential targets but these announcements are calendared elsewhere too. Entry is by a pre-set buy order, set within the 7 days prior to results, preferably at a price a little above a recent daily low - no specific candlestick etc. patterns. I have to check the targets to make sure my SB firm actually offers a book on these shares - unfortunately many AIM and smallcap stocks are therefore not tradable for me - these often move dramatically on news.

Right now I am in -
Balfour Beatty (results expected 18/08)

I have orders set for -
RPS (11/08, so this is running late: its such a nice uptrend I'm giving it a few more days)
Bank of Georgia (17/08)
Antofagasta (19/08)
Marshall's (19/08)
OSB (19/08)
Rank (19/08)
South32 (19/08)

This strategy is old as the hills. I had read about it in my very earliest trading / TA books. Alpesh Patel also put up a similar strategy outline, I think it was in the FT many years back: significantly Alpesh used an aggressive SL based on the low of the day preceding the results announcement.

This is running OK for me though I appreciate the stock indices are all bullish so that has to help. These days I'm looking forwards to Monday mornings again.
 

1nvest

Well-known member
309 109
Thanks for sharing this Tom, really simple strategy that anyone could follow
do you mind if I ask a few questions?...
1) what do you define as the term, bullish uptrend? is it a comparison of various MAs for example?
2) do you also need the index (or even sector) to also confirm the uptrend
3) this is all on the daily timeframe presumably..although looking at the strategy if its 7 days, the chart timeframe is largely irrelevant, other than the trend question to number 1.

would be interesting to see the results of these. Thanks again
 

tomorton

Legendary member
8,399 1,338
Thanks for sharing this Tom, really simple strategy that anyone could follow
do you mind if I ask a few questions?...
1) what do you define as the term, bullish uptrend? is it a comparison of various MAs for example?
2) do you also need the index (or even sector) to also confirm the uptrend
3) this is all on the daily timeframe presumably..although looking at the strategy if its 7 days, the chart timeframe is largely irrelevant, other than the trend question to number 1.

would be interesting to see the results of these. Thanks again
Thanks for the queries.

1) Yes, I check that a) the 20, 50 and 100 EMA's are stacked top down in that sequence, and b) key is that 50EMA is also sloping upwards.

2) Yes. I would stay out of this strategy if the indices are ranging or bearish. I wouldn't even use it to short bearish stocks.

3) Yes, I just use the dailies for this.
 

tomorton

Legendary member
8,399 1,338
No additional positions have opened yet but I have been able to drop entry prices to new lower levels based on yesterday's daily highs.
 

tomorton

Legendary member
8,399 1,338
Balfour Beatty position stopped out. Disappointing to have that happen even before the results are released (due tomorrow) but that's trading.

I will enter a new Balfour buy order late this afternoon based on today's high. Looks like it'll be just a shade lower than the earlier entry price.
 

tomorton

Legendary member
8,399 1,338
In the end I had to set the Balfour Beatty No.2 trade early and it has already triggered.

Marshall's and Rank have also triggered and are running.

Antofagasta triggered but already stopped out.

Hey ho...
 

tomorton

Legendary member
8,399 1,338
Balfour Beatty No.2 stopped out. Grrr. Absolutely massive price drop so no third attempt on this one.

Antofagasta No.2 set.

OSB triggered.

John Wood, Costain and Grafton set.
 

tomorton

Legendary member
8,399 1,338
Rank hit SL.

Marshall's and OSB hit TP's.

New buy order for Clipper Logistics set this am and already triggered.

John Wood, Costain and Grafton orders pending.

Orders for Bank of Georgia, Antofagasta and South32 cancelled.
 
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tomorton

Legendary member
8,399 1,338
Friday update.

Clipper Logistics long still running.

CRH and Grafton orders triggered and now running.

John Wood and Costain orders still pending.

Buy order for Unite added.

Old Mutual 20EMA has just push above the 50, so the three EMA's are now in a bullish stack. Announcement expected 31/08 I'll probably add this as a buy order this weekend. (or early Monday am)

Potential buys to be considered in the next few weeks are
Dechra Pharmaceuticals PLC (DPH): announcement expected 06/09
Gamma Communications PLC (GAMA) - 07/09
Safestore Holdings PLC (SAFE) - 07/09
Halfords Group PLC (HFD) - 08/09
Computacenter PLC (CCC) - 09/09
Emis Group PLC (EMIS) - 09/09
Genus PLC (GNS) - 09/09
Spire Healthcare Group PLC (SPI) - 09/09
Stv Group PLC (STVG) - 09/09
 

1nvest

Well-known member
309 109
I'd be interested to see what your results are like at the end of the month Tom.
would i be too cheeky to ask to know the return, and %ge winners losers?. It would be really good to see how losers coincide with recent price action. as we go through a minor correction, you start hitting losses, and then as the trend starts to recover, then the winning streak becomes pronounced
 

tomorton

Legendary member
8,399 1,338
I was just thinking this am I will do a monthly statistical update at the end of August but I'm going to avoid collecting weekly performance data.

If its meaningful the results for the month so far are -
14 trades hit TP at +1.5ATR14 each
16 trades hit SL at -1ATR14 each

9 trades closed either manually or at revised TP/SL for an aggregated profit of about another +2ATR14 as I was playing around with trailing stops and eye-balling exits. Not something I intend to develop at this stage because it introduces a subjective element, it increases the daily work-load and it introduces intra-day price monitoring - I am really enjoying not making trade decisions during the day.

Overall this is financially positive enough for me to carry on with this; right now I'm thinking I won't be running any other strategies in September but two things could de-rail performance - very light company announcements calendar giving few opportunities, or a global stock market downturn. We will see. I don't intend ramping up position sizes to 2% risk per trade yet, that could be something for October if all goes well.
 

tomorton

Legendary member
8,399 1,338
Monday update.

Costain, Old Mutual and Unite buy orders triggered.

Grafton hit SL and closed. New Grafton buy order set tonight as uptrend remains in place and announcement not expected until Wednesday.

Unite looks ghastly owing to huge outside bar candle and low close, but holding on, at least another day.
 

tomorton

Legendary member
8,399 1,338
Tuesday update.

Had to let Unite go as it was just slipping lower and lower. But I have set a second buy order as results are not due until 27/08.
 

tomorton

Legendary member
8,399 1,338
Wednesday update.

Grafton buy order triggered.
John Wood triggered and hit TP.
Old Mutual hit TP. Their interim results are not due until the 31st so there might be an opportunity for a second trade on this one if price weakens a little.

Costain hit SL. Positive first-half results were released today as expected but price made an unusually long outside bar with a low close. I'm not going to chase this one for a second attempt.
 
 
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