And that, ladies and gentlemen, is what we call vindication.
Last week, things looked bad. I had managed to turn a profit of more than £2,000 (Dh11,584), carefully (or, more accurately, luckily) crafted over 25 weeks, into a near-loss.
In a sense, I was in a trap, tied to the roller-coaster ride of a single stock - the very opposite of the bet-hedging diversification urged by every idiot's guide to day-, or swing-trading.
But, as I explained last week, I wasn't simply holding on to my shares in BG, the former British Gas, out of stubborn pride; I was attempting to apply some science to my blind faith and guesswork in the shape of Fibonacci retracement patterns.
This mysterious maths-based analysis of the impact of human behaviour on the price of shares - the way in which herd instinct, at predictable moments in the price cycle of any stock, will coagulate into a buying and selling pattern for no discernible, exterior reason, and effect a price movement - appeared to indicate that BG's price was about to change direction. And, lo, it has come to pass.
And not before time. Last week, I - or, rather, Fibonacci - predicted that, despite the apparent downward spiral in value, BG would soon pick up. I didn't really believe it, to be honest, but now my faith in 13th-century Italian mathematicians has been restored.
I'm sorry to gloat, but here I'm going to repeat what I wrote last week: "If human behaviour is all it's cracked up to be, then we should next expect a sell-off - which will in turn provoke a buying spree, raising the price once again."
And what have we seen? That's right, ladies and gentlemen, exactly that, before your very eyes.
Overall, in a series of purchases spread over a few days, I had paid an average of 1,242.7 pence for my BG shares, the price of which last week had dropped to a mere 1,168.5p. Applying Fibonacci's numbers theory - applicable to everything from rabbit-breeding patterns to stock-market share movements - I boldly predicted they would soon bounce back to about 1,200p.
I was wrong, but in a very, very good way. In fact, they bounced back to 1,267p.
Now, of course, was the time to sell, to make hay while the sun was shining - but to do so intelligently. A new trading day loomed. There would be nothing worse than to miss the moment and see the price drop rapidly back down again at the opening of business, so to protect against this, I put a stop-loss in place, to sell the lot if the price dropped to 1,260p.
Then I had a closer look at the chart for the past three months - and I've reproduced it below so you can see what's been going on. The red bars show selling activity; the green, buying. Selling provokes a drop in price, buying, the opposite.
Take a look at the buying activity that has stimulated the current price restoration. Now look back along the graph; it's the most sustained buying spree in the past three months. That can mean one of two things; either the buying is nearly over, and we can expect a brief period of consolidation followed by a fall, or this is the start of a major upwards price adjustment.
I decided to put in place stop-loss and limit positions that would protect me against losing out in either eventuality. Of course, if the price really rocketed upwards, I was ready to adjust my limits accordingly.
But what should my upper limit be? If we really are seeing a major price recovery, how high could it go?
In the past year, this share hit its peak to date of 1,296p at the beginning of November. Step back further and look at a chart for the past two years, however, and it becomes apparent that this most recent peak was the third in a series that began in May 2009. Since then, the price has fallen away, then risen higher, fallen away again, and then risen higher still.
Drawing a line through each of these successively higher peaks leads to the tempting inference that, if we really have now embarked on the final ascent to a fourth peak, we will shortly be requiring oxygen, as the price could be on its way to 1,400p or more.
That price, however, seemed far too high, so I opted for a conservative upper sell limit of 1,300p.
In the event, I acted just in time, and it worked beautifully. The price flicked upwards and briefly hit 1,300p a share within a few minutes of the market opening. The software dutifully cashed in my chips, leaving me with £16,720.36 in the bank, representing a profit on my original £15,000 fantasy investment of £1,720.36. Not a bad recovery from last week's flat line.
If this were for real, it would have been a pulse-quickening couple of weeks - but I doubt my sense of self-satisfied smugness would be any more pronounced than it is now.
jgornall@thenational.ae
Company profile
Name: Infinite8
Based: Dubai
Launch year: 2017
Number of employees: 90
Sector: Online gaming industry
Funding: $1.2m from a UAE angel investor
MATCH INFO
Manchester City 3
Danilo (16'), Bernardo Silva (34'), Fernandinho (72')
Brighton & Hove Albion 1
Ulloa (20')
Formula Middle East Calendar (Formula Regional and Formula 4)
Round 1: January 17-19, Yas Marina Circuit – Abu Dhabi
Round 2: January 22-23, Yas Marina Circuit – Abu Dhabi
Round 3: February 7-9, Dubai Autodrome – Dubai
Round 4: February 14-16, Yas Marina Circuit – Abu Dhabi
Round 5: February 25-27, Jeddah Corniche Circuit – Saudi Arabia
Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
BABYLON
%3Cp%3EDirector%3A%20Damien%20Chazelle%3C%2Fp%3E%0A%3Cp%3EStars%3A%20Brad%20Pitt%2C%20Margot%20Robbie%2C%20Jean%20Smart%3C%2Fp%3E%0A%3Cp%3ERating%3A%204%2F5%3C%2Fp%3E%0A
COMPANY%20PROFILE
%3Cp%3E%3Cstrong%3ECompany%3A%3C%2Fstrong%3E%20Vault%3Cbr%3E%3Cstrong%3EStarted%3A%20%3C%2Fstrong%3EJune%202023%3Cbr%3E%3Cstrong%3ECo-founders%3A%20%3C%2Fstrong%3EBilal%20Abou-Diab%20and%20Sami%20Abdul%20Hadi%3Cbr%3E%3Cstrong%3EBased%3A%20%3C%2Fstrong%3EAbu%20Dhabi%3Cbr%3E%3Cstrong%3ELicensed%20by%3A%3C%2Fstrong%3E%20Abu%20Dhabi%20Global%20Market%3Cbr%3E%3Cstrong%3EIndustry%3A%20%3C%2Fstrong%3EInvestment%20and%20wealth%20advisory%3Cbr%3E%3Cstrong%3EFunding%3A%20%3C%2Fstrong%3E%241%20million%3Cbr%3E%3Cstrong%3EInvestors%3A%20%3C%2Fstrong%3EOutliers%20VC%20and%20angel%20investors%3Cbr%3E%3Cstrong%3ENumber%20of%20employees%3A%20%3C%2Fstrong%3E14%3Cbr%3E%3C%2Fp%3E%0A
Tips for taking the metro
- set out well ahead of time
- make sure you have at least Dh15 on you Nol card, as there could be big queues for top-up machines
- enter the right cabin. The train may be too busy to move between carriages once you're on
- don't carry too much luggage and tuck it under a seat to make room for fellow passengers
The%20specs
%3Cp%3E%3Cstrong%3EEngine%3A%3C%2Fstrong%3E%201.5-litre%204-cylinder%3Cbr%3E%3Cstrong%3ETransmission%3A%20%3C%2Fstrong%3ECVT%3Cbr%3E%3Cstrong%3EPower%3A%20%3C%2Fstrong%3E119bhp%3Cbr%3E%3Cstrong%3ETorque%3A%20%3C%2Fstrong%3E145Nm%3Cbr%3E%3Cstrong%3EPrice%3A%20%3C%2Fstrong%3EDh%2C89%2C900%20(%2424%2C230)%3Cbr%3E%3Cstrong%3EOn%20sale%3A%20%3C%2Fstrong%3Enow%3C%2Fp%3E%0A
Tottenham's 10 biggest transfers (according to transfermarkt.com):
1). Moussa Sissokho - Newcastle United - £30 million (Dh143m): Flop
2). Roberto Soldado - Valencia - £25m: Flop
3). Erik Lamela - Roma - £25m: Jury still out
4). Son Heung-min - Bayer Leverkusen - £25m: Success
5). Darren Bent - Charlton Athletic - £21m: Flop
6). Vincent Janssen - AZ Alkmaar - £18m: Flop
7). David Bentley - Blackburn Rovers - £18m: Flop
8). Luka Modric - Dynamo Zagreb - £17m: Success
9). Paulinho - Corinthians - £16m: Flop
10). Mousa Dembele - Fulham - £16m: Success
MATCH INFO
Uefa Champions League semi-final:
First leg: Liverpool 5 Roma 2
Second leg: Wednesday, May 2, Stadio Olimpico, Rome
TV: BeIN Sports, 10.45pm (UAE)