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Volatility and Navra

Discussion in 'Managed Funds & Index Funds' started by Demoman, 12th Mar, 2006.

  1. Demoman

    Demoman Member

    Joined:
    23rd Oct, 2005
    Posts:
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    Hi Everyone,

    I wonder, having read this article,

    http://www.smh.com.au/news/business/vale-volatility-as-stockmarket-returns-stabilise/2006/03/10/11

    whether this trend has been noticed by the powers that be at Navra.

    Being a fund which relies heavily on volatility could it be that this lack of long term volatility, as noted by CommSec, has affected the potential for returns by the fund. Or the fact that short term volatility is still occuring a plus for the fund. Steve has said that the fund doesn't perform as well during a bull run and requires volatility, or words to that effect. But which is better long term or short term or does it make no real difference as long as it's volatile?

    Is it possible that this trend may continue well into the future and for how long?

    Should this trend continue and risk is reduced to investors is this likely to fuel the bull run further?

    Just some questions from a real novice.......... :)

    Comments anyone?

    Cheers

    Jared
     
  2. Alan

    Alan Well-Known Member

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    Location:
    Sydney
    Hi Jared.

    That link doesn't seem to be working. :confused:

    From your comments, it would appear it was saying that there's been a general reduction in volatilty over recent times though. Is that it?

    If so, that would be interesting. I've occasionally wondered for example, what the longterm changes will be as a result of compulsory super etc. It's a HUGE amount of money, and I would imagine the way it now regularly drip feeds back into places like the Australian sharemarket may well cause a changed financial landscape in some ways. Could it cause reduced volatility to some degree? I guess that's possible.

    Just from a quick look at history, we can pretty much be assured of semi regular major volatilty from wars, natural disasters etc. but it would be interesting to see if in say the last 15 years, the smaller, more regular volatilty has reduced somewhat.

    Sounds an interesting article if you can find it again............
     
  3. Demoman

    Demoman Member

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    Alan,

    Sorry about that. Never posted a link before.......so a few teething problems.

    The article was in SMH on Saturday in the Business section under Vale Volatility.

    I'm late for work so maybe someone else can try & post the link for me........Michael where are you?

    Anyway........very interesting article.......well worth reading.

    Cheers

    Jared :)
     
  4. Alan

    Alan Well-Known Member

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  5. Tropo

    Tropo Well-Known Member

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    NSW

    Volatility is the key to Steve's system ( short/long term does NOT matter !!!!).
    As you know, last 3 years OZ market has NO volatility at all ( almost).
    Statistically market is moving sideways most of the time. What we experienced in the last 3 years is quite unusual.
    That is why Steve's system is not as effective as it should be.
    BUT do not forget that what is going up MUST go down.
    So one day we'll get very "choppy" market = where Steve's system will kick in and is the most effective.
    Market is still bullish - but is not as strong as it was some time ago.
    Just.... be patient !!
    :cool:
     
  6. Demoman

    Demoman Member

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    I'm a pretty patient kind of guy.........just trying to learn some stuff is all.

    Cheers

    jared :)
     
  7. Tropo

    Tropo Well-Known Member

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    Location:
    NSW
    Jared,

    1) So, what could be causing this sideways movement?
    Could it be as Alan has mentioned all the Super being drip fed into the market?


    I think that it's more about global situation than about Super alone.
    Do not forget that OZ Stock Market is very small (about 3% of global markets).
    If US sniff.....we'll get influenza.

    2) What circumstances economically would trigger a choppy market?
    Too many possibilities including :
    currency correlation, balance of payments, interest rate differentials, economic indicators ( say .... employment, inflation data, retail sales, gross domestic product, etc, etc ...) and many others...

    If you are interested in this kind of economic info, go to =

    US Economics and Statistics Administration >> www.economicindicators.gov
    US Federal Reserve >> www.federalreserve.gov
    US Bureau of Economic Analysis >> www.bea.gov
    US Bureau of Labor Statistics >> www.bls.gov
    Reserve Bank of Australia >> www.rga.gov.au
    Australian Bureau of Statistics >>www.abs.gov.au
    The Wall Street Journal >> www.wsj.com
    Reuters >> www.reuters.com
    The Economist >> www.economagic.com
    :cool:
     
  8. Demoman

    Demoman Member

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    23rd Oct, 2005
    Posts:
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    Hi Tropo,

    Thanks for those links and your replies. I will be checking them out and will be a wiser man for it I'm sure.

    Have a great day.

    Cheers

    Jared