While we stick to our longer-term positions in selected shares, we also manage shorter-term opportunities for those clients who wish to trade more actively in search of greater yield.
The International market had an excellent rally since middle March. It is time for a correction of this rally since the market is overbought on a daily and weekly scale. A pullback to 12400 will present another entry point in the rising trend. We use the Dow Jones Industrial Average as an indication of the health of the global market. By co-ordinating our entry points on selected JSE-listed stocks with pullbacks on the Dow, we increase our return on equity.
Such a pullback will give us a good "risk/reward" entry and an opportunity to add to current positions. Risk in this case is defined as the difference between the entry point and the stop loss level.
