Astro Picks (Jan 2016)

1st Jan '16 by Paracelsus

10 comments 9166 reads

Happy New Year to everybody!

This is my first post here, so I hope you won't be too unkind.

One of my interests is financial astrology, and using planetary positions to predict market movements.

Each month I plan on posting a shortlist of a handful of shares, chosen by astrology. Of this shortlist, I will pick the one with the highest StockRank, and add this to my portfolio. This combination should have an interesting blend of voodoo and empirical validation, and the high SR will prevent me from adding junk to my portfolio. (I intend to invest in my top pick each month, but I haven't yet decided what to do if none of my shortlisted companies are highly rated by Stockopedia.)

I hope to update readers each month on how my previous picks have performed.

Okay, here I go!

For January 2016, my shortlist is: Carpetright (LON:CPR), Direct Line Insurance (LON:DLG), Morgan Advanced Materials (LON:MGAM), Majestic Wine (LON:MJW), and Pendragon (LON:PDG).

Of these, my top pick is Pendragon (LON:PDG), with a StockRank of 97, so I'm happy to put this in my portfolio (current price 46.75p).

Pendragon has a Mars return completing mid January, and Jupiter will reach its Midheaven in September. The share price has already risen by 20% in the last six months, but is there more room for improvement?

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gus 1065

1st Jan '16

Morning Paracelsus. Happy New Year to you too and welcome to Stockopedia.

I am intrigued, and I must confess a little sceptical, about the approach but I guess you often get that response.

Quick question on your approach. In order to identify your picks, how do you screen the market as a whole to identify which stocks to look into in more detail? Presumably it is quite time consuming to draw up each astrological chart and with several thousand stocks to pick from where do you start?

More than happy to keep an open mind. If it proves to be a successful selection technique over an extended period of time, good luck to you!

All the best,

Gus.

Paracelsus

Thanks for your kind welcome and good wishes, Gus.

Yes, screening would be difficult in times past, but modern astrology software takes a lot of the drudgery out of it. I try to collect two charts for each stock, one for the date of incorporation and one for the date of first listing. At present I have 1386 charts in my database, including all the large and mid caps, but few micro caps. I'm only adding new stocks with a high StockRank, so this should give me a positive bias.

The only difficulty is deciding which of the millions of possible factors to screen for!

Carey Blunt

2nd Jan '16

I love this post! I would love to see the whole portfolio and compare its results with other strategies discussed on here such as NAPS. There is absolutely room in the world for examining this type of approach although I would love to see a fantasy portfolio of picks where no stock rank was applied as a baseline.

I've taken the liberty of putting Paracelsus's picks into a shadow portfolio which I plan to update as and when further picks are made. To follow the particular recommendation on Pendragon (LON:PDG), I have allocated £3k to this stock and £2k to the other picks with a £9 per purchase cost and an ask to bid spread. I will post an update in due course together with my own 90+ Stock Rank pick portfolio and "Guilty Pleasures" story stock picks that I posted on a few days ago. It'll be interesting to see how the performance compares between the different approaches.

As CB comments, there is a bit of overlap in that Paracelsus is using Stock Ranks to supplement the astrological analysis. It would be interesting to test the Astro picks absent further Stock Rank input.

Gus.

3rd Jan '16

Thank you, Carolyn! I plan to update readers on the performance of my basket of shortlisted stocks, as well as my portfolio selections, as you and Gus have suggested.

CharMar

4th Feb '16

I love it. Having one's plonker pulled by Paracelsus is the best giggle I've had for a long time.

WarrantStar

Paracelsus
I think that you would do better to carry out some fundamental research on companies with high stock ranks before making your share selections. Or is there some academic evidence that shows that shares which are astrologically selected do better than the rest of the market? If there is any such evidence please can you direct us towards it so that we can all benefit from it.

TangoDoc

Given that i sometimes wonder if my stock picking and portfolio strategy is actually any more intelligent than one devised by a semi- trained chimpanzee, I thought I would suspend my normal scientist's bias and create a fantasy portfolio using criteria similar to the ones suggested by Paracelsus. It also has some similarities with the method I last used on a very successful evening at the Catford dog track.

LON:SUN Surgical Innovations
LON:STAR Starcom
LON:AZN AstraZeneca
LON:SKY Sky
LON:MARS Marstons
LON:JUP Jupiter Fund Management
LON:NTB Neptune Technology and Bioressources
LON:URA Uranium resources (Well I usually avoid URANUS itself)
LON:PPG Plutus Powergen (not a light year away)
LON:SAT Satellite Solutions
LON:NASA Nasstar Worldwide

and, for some reason, Toshiba LON:TOS I rejected LON:DTY Dignity and LON:BAD Badger Daylighting as dead losses, being both bad and beneath dignity

Well, who'd have thought it? Admittedly, the F score is a little low for comfort at 4.5 it's more small cap than makes me entirely happy and it's a bit heavy on healthcare at 16.7% of the portfolio but, against that and a mean, mean dividend yield of 1.6( covered more than twice) it does have a average PE of 7.4 EPS growth of 4.7, peg of 0.7

I am over the moon about this, as you can imagine.

bargainvalue

27th Feb '16

I agree, that the PDG is a good company and can be an interesting investment. However, what do you think about a recent, big declines?

28th Feb '16

Actually, looking seriously at PDG, I think it may be more Goofey than Pluto and I suspect the company may be not long for this world.

Astro Picks (Jan 2016)

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Paracelsus

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