Investment Without Tears
Richard Cluver

ISBN 0-947-44612-5

Table of Contents

• All about stockbrokers
  How to choose one. What you can expect of them and what they want from you. What they charge. When you must pay. Keeping records.

• Types of deals
  Call options. Puts, Doubles, Short sales. Margins, Bulls and Bears.

• Types of securities
  Stocks and Shares, Gilts, Equities, Preference and Fixed Interest Stocks, Debentures, Convertibles, Unsecured Debentures.

• The market cycle
  How to multiply one's profits by buying at the bottom and selling at the top.

• Introducing the Blue Chip
  The importance of a good dividend record.

• A quick test to find the Blue Chips
  When the highest-priced shares are not necessarily expensive.

• Splits - a profitable opportunity
  When prices get too high.

• All about yields
  When cheap is expensive.

• Introducing the overbought/oversold phenomenon

• Price-earnings ratios

• Comparing dividends with ruling interest rates
  When shares are overpriced or underpriced. The fundamentals that determine the start of a bull market and the start of a bear market. How to determine if you are paying too much for your shares. The effect of inflation upon share prices. Why markets sometimes defy national economic cycles and keep on rising despite rising interest rates and other contraindications.

• Five basic rules to test for a blue chip

• Where can one find historical data?
  The information you can obtain from the Stock Exchange Handbook... and how to make use of it.

• Earnings per share - one of the basic tests

• But the dividend trend is the most fundamental test
  How to draw up a short list of winning shares using dividend progressions as the basic test. How to shorten the list to managable proportions.

• Why are some top performers seemingly undervalued
  Understanding that a winning five-year dividend yield trend is an incomplete test. Refining our list by adding in the earnings trend.

• Bringing 'Return on Capital Employed' into the equation.
  Refining the list even further.

• Putting all this data together

• Comparing our list with a list of "traditional" blue chips
  Why the institutional favourites are not always the best choice if you want to be sure of making capital profits.

• Introducing ten-year statistics
  Ten-year dividend records make for greater investment certainty, but that cuts out an important group of companies which have volatile histories. Time for some compromises and the creation of an index of performance.

• The proof of the pudding
  Shares selected by my fundamental process achieved 1363 percent growth against the JSE Actuaries' 608 percent in the 1982-1987 bull market. And the traditional blue chips achieved 658 percent. After the crash my Top 150 shares also recovered sooner.

• Identifying the traditional blue bloods
  The market capitalisation test and a few other distinguishing marks of the dynasaurs.

• Considering loan gearing in order to refine the list even further
  Understanding how borrowings can boost profits when interest rates are low but prove a handicap at other times.

• The company's assets are also important

• Don't forget the auditors' report

• The Chairman's report

• Shares should be freely available
  What if majority shareholders control the company

• The importance of trading vulnerability and the hazards of single-product based companies

• Mining shares - the most volatile and profitable sector of the share market
  How to evaluate base-mineral companies.

• Gold shares - A whole new ballgame for the analyst
  Understanding the fundamentals that enable one to project the likely future profits of gold mines: gold yield, production costs, tonnage milled.

• Extrapolating profits and their future impact upon share prices

• Gold mine breakeven costs and the gearing effects of bullion price and exchange rate variables

• The rich mines are safe investments but the marginals make the big market profits
  Understanding how mine profitability can be geared to the benefit of the investor.

• A complete gold mine ranking - illustrating gearing

• Creating a balanced gold portfolio

• Signals that warn one of future gold profits - a trading opportunity

• Investment trusts

• Now you know which share to buy - but is your timing right?
  Understanding the market cycle.

• When to buy - and when to sell

• The folly of holding on too long - and the even worse folly of the "averaging" argument

• Introducing Technical Analysis
  How to multiply your profits by correctly timing your buying and selling decisions.

• Moving Averages
  How to create a moving average chart - its strengths, weaknesses and practical application. How to make quick trading profits.

• Weighted and Exponential Averages - only for the sophisticated

• Relative-strength and Comparison charts

• On Balance Volume charts
  How to construct this useful indicator and an example of how it illustrates the profitable gold mine wave theory.

• Why analysts use closing prices - introducing the momentum indicator

• The Stochastic indicator

• The Advance-Decline line

• A refined Advance-Decline indicator using my Top 150 list

• The High/Low indicator

• The Top 150 New Highs/New Lows indicator

• The Top 150 Test

• An All-Market OBV

• Interest rate trend

• Overbought/Oversold

• Rate of Change or Momentum Indicators

• The Top 150 UnderprIced/Ovorpriced indicator

• The JSE Actuaries Index

• How to construct a point and figure chart

• Reading chart formations and signals

• Double and Triple Bottoms and the Bearish Signal Reversed

• The Bearish Triangle

• Combinations

• Spreading Formations

• Trend Lines

• The Bullish Resistance Line

• The Bearish Support Line

• Wave Theory
  Nicolai Kontratieff, Arthur Brenner, W.D. Gann and R.N. Elliott.

• The Game Plan
  A step by step process to eliminate risks and boost your stock exchange profits.

• How Richard Cluver Investment Services can assist you to achieve major investment profits

• Appendix: Printouts from the ShareFinder 1 computer programme