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Monday, 9 April 2018
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Sector Selection

A bit of big cap stock selection:

RESOURCES – Bottom of range buying opportunity or break of uptrend? Here are the charts of BHP and RIO – both bottom of trading range, no break of uptrend yet. Happy to hold for the moment, might even buy if they start to rally.

To confirm that here is a chart of the resources sector relative to the ASX 200 showing that it has been outperforming for the last couple of years and continues to do so:

BANKS – This is the chart of the bank sector relative to the ASX 200. It remains in a downtrend and continues to cost us performance. We don’t hold them in the Marcus Today SMA but hold ANZ, NAB and WBC in the Marcus Today Income SMA as they run into results and dividends (we sort of have to).

We are less than a month out from NAB, ANZ and WBC results and ex-dividend dates. In other words, this is the time when you would normally buy for a dividend strip, for a run-up to the results and dividend, and still qualify for the franking under the 45-day rule and be able to sell soon after they go ex-dividend.

  • BOQ – Interim Results – April 17.
  • BOQ ex-dividend April 26. Paid May 16.
  • ANZ – Interim Results – May 1.
  • NAB – Interim Results – May 3.
  • MQG – Interim Results – May 4.
  • WBC – Interim Results – May 7.
  • MQG ex-dividend May 14. Paid July 3.
  • ANZ ex-dividend May 14. Paid July 2.
  • NAB ex-dividend May 15. Paid July 5.
  • WBC ex-dividend May 17. Paid July 4.

However, the banks are clearly in a sentiment hole and judging from the Royal Commission they don’t appear to be about to come out of it. The media coverage remains negative. It’s a brave investor who bothers stripping the bank dividends this results season. There is no sign of life yet. One day the sector will bottom, the numbers are attractive to any income focused investor (see below) if only they could be certain of not losing any more capital. It just doesn’t appear to be yet. That will change one day.

Bank sector performance:


Remains in downtrend. Waiting for the turning point:

Almost oversold on RSI on a weekly basis:

No Results

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