The creators of the invest-idei.ru resource, which checks the quality of analytics provided by brokers, have prepared a series of materials specifically for FO on the strengths and weaknesses of the content of the most active professional participants. The first article contains an overview of recommendations from BCS.
pros
The materials are published on the BCS-Express website. Recently, the broker also has a separate Telegram channel for investors, where exclusives and recommendations on short-term transactions sometimes appear.
Based on the results of monitoring more than 120 forecasts from BCS, 71% of the bottom brought profit for 2015-2017. The vast majority are issued with an eye to asset growth. At the same time, the average return on a few “bearish” ideas for BCS is higher than for “bullish” ones (+8.65% vs. +4.95%).
Interestingly, BCS forecasts usually come true faster than analysts initially assume: the average position holding period is 116 days with a “planned” year.
Company analysts prefer American market. This is probably due to low liquidity and the choice of instruments on the Russian market. However, many covered US stocks are traded on the St. Petersburg Stock Exchange.
Despite the "love" for foreign, the average return on investment Russian shares higher than in the US.
Discipline - here we mean how the broker keeps track and updates the status of an idea after it's published - is also fine. "Closed by timeout" means that the idea was automatically closed after the recommended investment horizon.
Investors are trusted by BCS analysts: 88% of investors received the “believe” mark. For other analysts on the market, this parameter is on average 85%. Such popularity leads investors to be equally optimistic about both potentially profitable and loss-making recommendations. Thus, relying on the opinion of the majority when choosing ideas in this case is not worth it.
And finally, the main parameter is profitability. The average expected (projected) profitability of investors is 16% per annum. At the same time, the actual profitability of transactions is 21%. This is because, on average, ideas work faster than expected.
Minuses
If we compare BCS analytics with the recommendations of other companies (we will talk about them in the following materials), we can note a low average return per trade (although they have more trades). According to this indicator, BCS receives 3 points out of 10.
In reviews, price stop-losses are rarely set. There are also cases where one idea overlaps another. For example, in May, analysts posted a Buy recommendation on the website American company Macy's at $24. Papers began to fall.
Some time later, the second idea was closed at $23. At the same time, the first idea remains relevant, and its followers still suffer losses. Obviously, formally, BCS released two ideas, one unprofitable, the other profitable, but in essence, investors, especially those who bought at $24, may have questions.
Perhaps the problem arose because the recommendations were published in different sources
Findings:
1) Pay attention to BCS ideas on Russian assets.
2) The actual trade horizon is likely to be shorter than predicted (this is good).
3) Keep track of the target prices of ideas, levels of profit taking and opening "short" positions - BCS can somehow accurately determine the turning points.
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- reflects professional opinion experienced experts about the Forex market;
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- review of international markets;
- in-depth, comprehensive monitoring of the state of the Forex market, aimed at studying the current changes in all financial instruments(currencies, stocks, indices, commodities, etc.);
- expert forecasts regarding future price trends.
The availability of analytics is very important, especially for novice traders taking their first steps in Forex trading.
Investment idea from BCS Express experts. Buying a simple and understandable dividend history against the backdrop of lower ruble rates
Trading plan
Purchase from the level of 267.15 rubles. for the purpose of 280 rubles. for a period of 5 months. During this period, it is envisaged to receive dividends in the amount of 8.68 rubles. Potential yield of 8%.
In detail
MTS papers are a popular dividend chip on the Russian stock market. Over the years, their dividend policy has remained relatively stable. With current year the amount of annual payments was increased from 26 rubles. up to 28 rubles Dividends are paid twice a year.
Investors' confidence in the stability of dividends in the future is supported by the fact that AFK Sistema, which controls about 50% of MTS, needs a constant inflow of funds to service and pay off its high debt burden. MTS in this regard is the main donor for the parent company.
Accordingly, confidence in the stability dividend payments(they are not reduced) gives us the opportunity to bet on the potential revaluation of MTS shares, which may be mainly due to the effect of the reduction in ruble rates.
According to the baseline scenario, the Bank of Russia will continue to progressively ease monetary policy until mid-2020. This may be due to low inflation, general trend in the actions of the world's key central banks, as well as the desire to stimulate economic activity.
As a target, the Bank of Russia focuses on inflation at 4% and a neutral policy, which implies a premium key rate in 2-3%. Thus, the rate may gradually fall into the range of 6-7%. In my opinion, these expectations are not yet fully incorporated into the quotes of Russian dividend chips and medium term should give them support. MTS in this regard is the most understandable story with an additional driver in the form of overall business growth.
The shares are now trading at the same levels that they were in the second half of 2018. But then the Central Bank of the Russian Federation raised the rate, and MTS dividends were 2 rubles. below. At the same time, I note that the growth of securities to the target designated within the framework of this idea is about 280 rubles. will assume a forward dividend yield of 10% (12 months ahead). That is, in this case it is obvious that if we talk about the long-term fair potential, then it is noticeably higher than 280 rubles.
In addition, MTS business is actively developing. Debt load remains comfortable even after write-offs in the case in Uzbekistan (Net Debt/OIBDA 1.3x). Financial indicators grow moderately. MTS shows the fastest revenue growth among the big three. In addition to the conservative telecommunications direction, the company now receives about 20% of its revenue from new businesses, and this share is only growing. Long term prospects development of MTS is an additional option to the idea in the company's shares, based on revaluation due to lower rates.
Rising inflation or geopolitical risks may force the Central Bank to take a wait-and-see attitude and stop progressive rate cuts.
A potential US delisting could trigger local sales.
The general wave of sell-offs in the stock market against the backdrop of the flight of investors from risky assets.
I propose to consider the purchase of MTS shares from the level of 267 rubles. for the purpose of 280 rubles. until the end of 2019 or about 5 months. During this period, dividends in the amount of 8.68 rubles are provided for in October. The potential profitability of the idea is 8% (19.2% per annum).
Important: If the target level is 280 rubles. will be reached before the dividend cutoff, then common goal according to this idea, it will shift to 288.68 rubles. (until October 10).
