I have decided to change the PIP-VEVE strategy so that we have more opportunities to buy and sell without unduly raising the risk of an upset.
*** If you do not want these changes implemented please let me know ***
Background
- It has been nearly 20 weeks since we last completed a PIP-VEVE cycle.
- Since then we have come close to acting on several occasions, but fallen just short.
- With a more relaxed approach we could have been in and out, more than once, and earned some more return.
- I have to be conscious of both the FCA regs and making sure some of you are not advantaged over others.
- That means, for example, I can’t simply pool your money to complete a PIP-VEVE cycle.
- Nor do I want to trade intra-day for fear of the price moving during the trades and some of you profiting more than others, or not participating at all.
Two Tweaks
I am comfortable with the following two tweaks, which I will use in combination:
- “Intraday High” – use the intraday high as our reference point. We would still buy and sell at the close to ensure fairness.
- “Lower Threshold” – reduce the 3% threshold by 0.25% after 4 weeks, and then a further 0.25% 4 weeks later.
Theses tweaks are easy to implement and would have been profitable over the last several months.
On the other hand they make it a little more likely that we act too soon when the market really is going to have a proper clear out.
Given your specific circumstances including cash reserves and income needs etc. I think this a tolerable potential inconvenience.
Unless you tell me otherwise the new rules will come into being on Monday.
Current State Of Play
Based on the new rules above, the current high is 8974 which was achieved at 1.30pm on 6 February.
If the price closes below 8705 between now and 6 March we will buy VEVE for you.
On 6 March, if the 3% barrier has not been breached, the target price will become 8727 and then 8750 on 3 April.
If 8750 is not achieved by 1 May we will review the rules again.