Alpesh Patel Special Edition

30 Pages·2014·1.98 MB·English

by  Tim Clarke

Alpesh Patel Special Edition

Alpesh’s guide to getting
the best out of his system

Introduction

Overview of the system

How I use the system

Alpesh Ratings

Data Mining Filters

Value/Growth

Momentum Value

Bullish Momentum

Bearish Momentum

Technical Radars

Momentum Radar

Breadth Radar

Volatility Radar

Volume Radar

Trade Management

Introduction
Contents

Welcome to the Alpesh Patel Special Edition of ShareScope. It is a series of systems that I have
used for many years, developing my own stock-picking filters and analytic settings (“radars”),
and which has proved consistently successful for me. I want it to save you hours and hours of
searching for trades and make you much more than it costs. It has done that for me!

Now, the Alpesh Patel Special Edition does not pick sure-fire winning trades and investment
ideas every time. It picks trades and investment ideas that already meet specific criteria that I
require as a starting point. These are criteria which I have settled upon over years of investing
and shorter-term trading.

I may still find reasons not to like some of the opportunities highlighted by my filters but I will
tell you the warning signs that I look for.

I have used this system for years now to target 25% growth per annum. It’s important to stress
the word TARGET. I set my sights high. Each year from 2004 to 2010, I picked a basket of stocks
for a 12-month buy and hold. In fact, all I did was list the stocks in my Alpesh Patel Value/Growth
filter on the day I gave the tips. Using this method I achieved a compound annual growth rate of
16.8%. Not 25% but I’ll take 17% every year and I’m sure you would too. Bear in mind, we had
the credit crunch during that period. The FTSE All-Share provided a 4.7% annual gain over the
same period.

Of course, no matter how good the fundamentals or the price momentum of a share, unexpected
events can always occur. That’s why it’s important to keep an eye on the news stories in
ShareScope and set appropriate stop losses. I’ll cover this in more detail in each section.
RISK WARNING: Spread betting and CFD trading are forms of trading on margin - they
typically require the deposit of a small percentage of the total trade value. Profits and losses
can quickly exceed the initial deposit because the financial outcome is determined by the
price movement on the total trade value. Ensure you understand the risks as these products
are not suitable for everyone. These products are only suitable for persons over 18. Speak
to your broker for more information before you decide whether to use them or not.

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Overview of the system
Contents

There are FOUR components to the Alpesh Patel Special Edition:

 Alpesh Table – which displays a range of momentum measures and includes my
proprietary Value/Growth Rating, Bullish Momentum Rating and Overall Rating. This is
loaded into one of your List Table settings.
 My four analytical “Radars” – four Graph Settings which focus on different aspects of
technical analysis. These are loaded into four of your Graph settings. Each radar also
includes my proprietary Alpesh Ratings displayed in the top left corner.
 My four proprietary data mining filters - Value/Growth, Momentum/Value, Bullish
Momentum and Bearish Momentum. These are added to your library of data mining
filters.
 My exclusive monthly newsletter in which I discuss the macro environment, pass on
research and present my current investment and trading ideas. This will pop up in
ShareScope on the day it is published. You can also access this from the InfoCentre option
on the View menu. My newsletter summaries the hours and hours of research I have done
for the month ahead and becomes my bible for TV interviews and trading. It has the best
of the research from everything I have read from all the private banks, Bloomberg and
hedge fund sources.

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How to access the Alpesh Patel Special Edition
Contents

When you subscribe to the Alpesh Patel Special Edition, a wizard appears in ShareScope which
installs the components of the system step-by-step. Most of these components can be found on
the Alpesh toolbar which is displayed just above ShareScope’s Settings toolbar near the bottom of
the screen:

To access each feature, simply click on it.

If you can’t see the APSE toolbar, Go to the Tools menu, then Options. You should have an Alpesh
Patel tab. If you don’t please call Support on 020 7749 8504. If you do, click on this tab and the
following dialog will appear:

Make sure the Enable Alpesh Patel Special Edition and Show Toolbar options are both ticked.
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NOTE: On the ShareScope Graph toolbar (running down the right-hand side of the
ShareScope screen) there are three buttons with D, W and M on them. Click on these
buttons to change your graph to daily, weekly or monthly periods. These buttons are only
available when looking at a price chart.See below:

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How I use the system
Contents

Here is a summary of the different ways you can use the Alpesh Patel Special Edition:

If you are looking for investment ideas:

1. Use my Value/Growth filter for 12 month buy and hold picks – stocks that show
undervaluation and growth. I look at the charts with my Momentum radar to ensure the
MACD is rising on the monthly chart or at least moving sideways

2. Or use the Alpesh Table with any list (e.g. FTSE All-Share) and sort by Value/Growth
rating or Alpesh Overall rating. Look for highly-ranked companies with a PEG below 1 and
the weekly and monthly MACD rising.

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If you’re looking for trading ideas:

1. Look at my Momentum/Value, Bullish Momentum and Bearish Momentum filters. Look at
each opportunity with my Momentum radar. You will not find in these lists every stock
that has gone up recently – it is a shortlist to save you time. I run through each stock in the
graph view to see which I like best. I want to see the weekly MACD flat or rising for a
bullish signal and Stochastic having risen and still rising.

2. Use my Alpesh Table and sort by 2-day % price rise to find the short term movers. Look
for rising MACD on daily and weekly charts using my Momentum radar.

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3. For medium-term trades, use the Alpesh Table and rank by Alpesh Value/Growth rating.
Look for a rating of 7-9 and then look for rising weekly and monthly MACD on my
Momentum radar.

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4. Use my Momentum radar to scan through any list of stocks, or other instruments (e.g.
forex), looking for bullish or bearish divergence (learn more about this in the Momentum
Radar section).

Pence 1 day bars Alliance Trust PLC Ord
380 Value/growth rating: 380
Bullish momentum: B Grade
Overall rating
360 360
340 340
15/12/11 28 '12 9 16 23 30 Feb 13 20 27 Mar 12 19 26 2 6/4/12
4 MACD 4
0 0
-4 -4
Stochastic Osc.
80 80
40 40
RSI
80 80
40 40
www.sharescope.co.uk Chart (c) ShareScope

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5. Look for charts where the daily, weekly and monthly MACD is going up, ideally from a low
base - these are mega-trends! On the daily chart, the MACD can be flat to rising, supported
by a rising weekly and monthly MACD. This usually means we are going to see a prolonged
rally as the daily buyers are supported by the weekly and monthly ones. Ideally the
Value/Growth rating should be 7 at least too to give extra comfort that the momentum is
supported by fundamentals. WPP below is a good example. The next three charts show
Daily, Weekly and Monthly price bars.

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