Lyft

This entry is a set of notes related to Lyft.

12 – November – 2019

Positive points found

  1. Strong hand is buying.
  2. Q3 data improves the date when Lyft will be profitable.
  3. Price < EMA 50
  4. Low debt company.
  5. Future cashflow value of the company estimated in 150$
  6. Individual insiders owns 5% of the company.

Negative things found

  1. Company losing money
  2. Market has low trust on companies as Uber, Lyft and others from same sector.

22 November 2019

I sold them on November 15th, at 43,34$, That Friday I assumed a bearish market and I sold them to protect that minimum margin. I was not patient enough.

O Realty Income, notes

This post gathers notes related to a long position I am working on O Realty Income (O).

12 – November – 2019

Positive things found

  1. Strong hand buying.
  2. SPX continues going up, waiting for a correction.

Negative things found

  1. Entry price over EMA-50.
  2. Very expensive PE > 60

Actions:

  • If price <EMA50 = second long.

Systematic trading by Robert Carver

I was looking for a trading book that goes beyond to the typical basic concepts and that send messages as “this is the book that will make you millionaire”.

Well, this is the first book I found with this characteristics. Very complete one, and complex enough that is going to force me to review many concepts again in detail.

Any other suggestion for next book?

Squeeze Momentum Indicator by LazyBear

Squeeze Momentum Indicator by LazyBear is a volatility indicator that I discovered in TradingView.

https://www.tradingview.com/script/nqQ1DT5a-Squeeze-Momentum-Indicator-LazyBear/

This is a derivative of John Carter’s “TTM Squeeze” volatility indicator, as discussed in his book “Mastering the Trade” (chapter 11).

Black crosses on the midline show that the market just entered a squeeze ( Bollinger Bands are with in Keltner Channel). This signifies low volatility , market preparing itself for an explosive move (up or down). Gray crosses signify “Squeeze release”.

Mr.Carter suggests waiting till the first gray after a black cross, and taking a position in the direction of the momentum (for ex., if momentum value is above zero, go long). Exit the position when the momentum changes (increase or decrease — signified by a color change). My (limited) experience with this shows, an additional indicator like ADX / WaveTrend, is needed to not miss good entry points. Also, Mr.Carter uses simple momentum indicator , while I have used a different method (linreg based) to plot the histogram.

Anticancer, a new way of life

I had this book in my list since a couple of years or so, finally I read it once a sibling was affected by the disease.

It’s a very valuable book independently of the circumstances. I was happy to discover that I was doing so many positive things to prepare the ground to avoid the disease.

The physiologic part of the book is very valuable, and put me on the perspective about what was happening to my family during these moments.

EPS Destruction in Spain

This article talks about so many things but the main point is the EPS (earning per share) destruction happened in IBEX (major Spanish market) between 2008 and 2018.

I want to keep this image, because some people tell me, why you do not invest more in Spanish companies? The picture below is a good answer.

BPS (Beneficio por acción) = EPS

How to Assess a Real Estate Investment Trust (REIT)

When you analyze REITs traditional metrics such as earnings-per-share (EPS) and price-to-earnings (P/E) do not apply.

Funds from Operations (FFO)

For most businesses, depreciation is an acceptable non-cash charge that allocates the cost of an investment made in a prior period. But REIT’s behavior is different because property often appreciates its value. This affects the Net income in a negative way.

By this reason it’s better to use funds from operations (FFO) for REITs.

In the quarterly reports you can find FFO along with net income.

FFO weaknesses

It does not deduct for capital expenditures required to maintain the existing portfolio of properties. Real estate holdings must be maintained (painted, repaired…) so FFO is not quite the true residual cash flow remaining after all expenses and expenditures.

What can we do? Use Adjusted FFO (AFFO)  it is a more precise measure of residual cash flow available to shareholders.

FFO is a Non‐GAAP Financial Measures

You can find in the financial reports of REIT companies this disclaimer:

FFO and AFFO are non‐GAAP financial measures within the meaning of the rules of the SEC. The Company considers FFO and AFFO to be important supplemental measures of its operating performance and believes FFO is frequently used by securities analysts, investors, and other interested parties in the evaluation of REITs, many of which present FFO when reporting their results. In accordance with the National Association of Real Estate Investment Trusts’ (“NAREIT”) definition, FFO means net income or loss computed in accordance with GAAP before noncontrolling interests of holders of OP units and LTIP units, excluding gains (or losses) from sales of property and
extraordinary items, less preferred stock dividends, plus real estate‐related depreciation and amortization (excluding amortization of deferred financing costs and above‐market lease amortization expense), and after adjustments for unconsolidated partnerships and joint ventures. Because FFO excludes real estate‐related depreciation and amortization (other than amortization of deferred financing costs and above market lease amortization expense), the Company believes that FFO provides a performance measure that, when compared period‐over‐period, reflects the impact to operations from trends in occupancy rates, rental rates, operating costs, development
activities and interest costs, providing perspective not immediately apparent from the closest GAAP measurement, net income or loss.

FFO and AFFO for Global Medical REIT Inc. (GMRE)

 

Un paseo por Wall Street

Este libro escrito por Burton G Malkiel es uno de los clásicos de la inversión en renta variable.

Yo he leído la novena edición y que viene con adaptaciones a los últimos años y reflexiones sobre como cambia el mercado.

Todo el mundo alaba este libro, pero a mi, por lo que sea no me ha encantado. Hay demasiados pensamientos y descartes para tratar de convencerte de que hay que indexarse.

La última parte donde sugiere caminos dependiendo de que se quiera hacer si me resultó algo más interesante, pero muy escueta y sin ir al detalle.

El paso “hágalo usted mismo”

Viene dividido en 4 consejos que son:

  1. Limite la compra de acciones a aquellas empresas que parecen capaces de mantener unos aumentos de beneficios por encima de la media al menos durante 5 años.
  2. No pague nunca por un título más de lo que se pueda justificar razonablemente mediante una base sólida de valor.
  3. Resulta de ayuda comprar acciones que tengan historias de crecimiento previsto con las que los inversores puedan construir castillos en el aire.
  4. Haga el menor número de transacciones posibles.

Inconsistencias

Durante el libro Burton se contradice a si mismo varias veces. Por ejemplo en una parte del libro menciona varias frases generalistas clásicas, despreciando ese tipo de chisme y comentario, como el

“manten los ganadores, vende los perdedores”

Después menciona esta misma frase arropando el mensaje que hay detrás de ella.

 

DIX and GEX indicators

Two specific indicators, the Dix and the Gex, have been born from the investigations of SqueezeMetrics. They serve to monitor the behavior of short orders in the Dark Pools, which gives us an idea of the bullish sentiment of the real market:

https://squeezemetrics.com/monitor/dix?

These indicators are the way to get our analysis to incorporate the indications obtained in high frequency trading. For me they are a complement.

They are not easy to follow and extract conclusions right away, but sometimes they help. Specially to try to identify divergences. Below an example between GEX and S&P.

The Dark Index (DIX)

The DIX is simply the aggregated dark pool indicators of the S&P 500 Index. It is, therefore, a measure of market sentiment from the point of view of dark liquidity—a largely unexplored source of information. For the sake of utility, the DIX uses dollar-weighted trading volume to compute the ratio of dark pool buying to dark pool selling.

Since DIX tends to rise into corrections, we are left to believe that it reflects
a broad willingness of investors to accumulate S&P 500 component stocks at
lowered valuations, and that high levels of short volume correspond to
positive medium-to-long term investor outlooks.

The Gamma exposure (gex)

  • When GEX is a high number, it acts as a brake on market price.
  • When GEX is low (including negative), it acts as an accelerator.

Both indexes are updated by 6:00pm ET except when market data is delayed.

Siete semanas

Dicen que la vida te puede cambiar en un segundo, a mi me cambió en siete semanas.
Siete semanas de darse uno cuenta que nada volverá a ser igual,
siete semanas de asimilación,
siete semanas con mil cosas por expresar, pero no saber por donde empezar,
siete semanas para disfrutar de cada minuto que tuve con ella,
siete semanas para llorar el día que pronto iba a llegar,
siete semanas de aceptación,
siete semanas que han acabado y que yo mentalmente aún no he abandonado,
siete semanas para revisar todos los valores que ella me quiso inculcar,
siete semanas para recibir mucha ayuda de vosotros, y que necesitamos para nuestro otro foco.
Y sin tiempo para parar, las cosas han de continuar,
porque no podemos de dejar de disfrutar de cada cosa que la vida nos da.