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PDSNET ARTICLES - JANUARY 2021

The Confidential Report - February 2021

America
The relatively calm installation of Joe Biden as president and the Democratic Party’s control of Congress were appreciated with relief by markets worldwide. The S&P has risen by almost 18% from its low of 3270 on 30th October 2020 to its recent high of 3855 on 25th January 2021. Biden has promised further substantial stimulation

Elimination of the Bears

As far back as January 2016, billionaire George Soros went short on the S&P500 index. This means that he thought the S&P500 was going to fall heavily and he took positions which would profit from a major fall in that index. Later in May 2017 he doubled up on those “short” positions and he has been taking more short positions ever since. As recently as final quarter of 2020 he bought

Truworths

Truworths (TRU) is a retailer of fashionware in South Africa and the UK. As such its business has been damaged by the impact of Brexit in the UK and the recessionary conditions in the South African economy. Both countries have then been impacted by lockdowns which prevented in-store sales for a period of time, beginning in late March 2020. The second wave of the pandemic has also been a factor. In the UK,

The Coming Blow-off

At the start of 2021, it is as well to stand back and consider the context of where world markets are as they slavishly follow Wall Street up to new record highs.  Consider the 12-year chart of the S&P500:

 
The chart shows that the great bull market which began in March 2009 is on-going. It is moving within a clearly defined channel.

Window Dressing

We all know that our market, the JSE, is dominated by the big institutions – the pension funds, unit trusts, insurance companies and a scattering of large fund managers. These institutions together account for at least 90% of the trades on the JSE by value. We private investors make up the rest.
Big institutions have huge holdings of mostly blue-chip or