The markets are twisted, but are there bargins to be found?

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So how is this euro crisis working out for me then?

Its all well and good writing investment books and being a pundit on global economics, but can you make money investing?

Having bailed a little bit late in the summer slump yet still missing a large chunk of the actual fall and all of the ‘virtual fall’ that could have been, I have been slowly sneaking back into the market.

I did so out of the pure force of addiction as equities are my favourite thing. I have only been buying extreme conviction value; that is to say stocks so cheap they should have resulted in my arrest for stealing them. Since September I’ve been picking off ‘bargains’ ending up with about 33% of my capital once more in play.

I still don’t like being in the market but currently I’m up 23% in 6 months on what I’ve put back in and on an average capital employed probably about a third ahead. Of course you could say I’m only 8% up on my full capital then I might say that was 16% annualised. In any event I have two points.

1) These markets are twisted. Twisted by governments on Kamikaze politico-econometric nose dives into the frigid unknown. I am therefore dancing while Rome burns or is that fiddling on the edge of a mixed metaphor, either way I feel I’m dicing with Darth? However the force is with me, for now.

2) Bull markets make every investor a genius, so I’m smart for now while the rally is hot.

Newish positions:
Name Weighting,
Cenkos, 1
Cable and Wireless,1
Enterprise Inn, 1
Transence Tech,1
Pendragon, 1

Old Positions:
Game Group,2
Lloyds, 6
Pace, 5
RM, 6
SSE, 2
Trinity Mirror,6

Weightings; the number is a multiplier of my unit of capital. So I’ve 6 times more Trinity Mirror than Mothercare. 37 units in 15 stocks. This should could as lightly diversified but should probably be considered undiversified value equity.

Profits so far:

Robert Wiseman Dairies RWD 46% –
Very lucky. Bought on 7% pre announcement spike, though had been watching this for a couple of months.

DTZ 16% –
General lunacy. This companies ending was a giant disgrace.

Lloyds 21% –
A large 15 unit punt. Sometimes you just have to. In at 28p out at 34. Position since built up again this time for longer hold.

MTC 4% –
Bought for a bounce that never came. Re-entry 25% lower.

No loses

I think 2012 will be a fine year but I’m still mainly in cash. But if directors buy their stock in beaten down shares I will be looking to take a unit of them and then buy more if they fall.

Meanwhile the portfolio I bailed on has only returned 50% more cash with 300% more money so my risk reward ratio is satisfying and breaking buy and hold rules hasn’t bit me yet.

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