Temporary shakeout exaggerated by machine trading

24 October 2018

Dear Fellow Investor,

The world wide share market correction is in my opinion a temporary shakeout exaggerated by machine trading and the doom and gloom stories promoted by the media.

Corrections are designed by insiders and smart money to washout the uninformed and fearful weak holders and speculators.

Since January 2018 there have been 12 corrections exceeding 400 Dow points and the market has recovered every time. The February correction was over 1300 Dow points.

One of the major sources of demand has been company share buybacks and this has been removed temporarily by the black out period.  Blackouts mean a company can not buy back shares during earnings releases.

It means once the blackout period is over, companies can buy back at cheaper prices.

Another sign of the correction ending was a Wall St Journal report Thursday that Presidents  Trump and Xi will meet to discuss trade issues.  The news sparked a world wide stock rally.

Our portfolios all have a dividend machine that works 24 hours 7 days a week for you. These are high quality companies with low debt, recurring revenues with sales and earnings growth. They share their profits with ever rising dividends. This is an inflation hedge unlike fixed deposits or bonds.

During market weakness they go down less as they are supported by institutional investors. They also recover faster.

Dolly and I will be visiting Perth from 14 Oct to 21 Oct.  I will be visiting South 32 a mining company for a possible investment opportunity for your PGWA accounts.

If you need to contact me about your investments  please WhatsApp or email me.

For any account queries you may call Nora at customer service @ 03 278 0300 .  For EPF queries, our planner Rianne @  012 303 8126

Invest well and grow your wealth,

Bill

012 685 1207

Critter of the week is the Perth Zoo koala bear. Below the bear is the siren call of socialism. The US mid term election is a battle between free market Trump and the Democratic socialists. The socialists are promising free education, increased hand outs, free healthcare for all, open borders etc. but the problem is: where’s the money ?