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Builder stocks : Bellwethers for UK Properties
= = = INDIVIDUAL PROPERTY COMPANIES = = =
UK Residential
UKX/ FTSE-100--------: Barratt Devl/ BDEV---: Persimmon Hm/PSN------: TaylorWimpey / TW.----: BalfourBty/ BBY
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Charts, Daily:
Barratt (BDEV)
Persimmon (PSN)
Taylor Wimpey (TW)
Balfour Beatty (BBY)
Wimpey (WMPY)
UK Builders, Barratt (BDEV), Persimmon (PSN), Wimpey (WMPY)
Taylor Wimpey's US Quote (TWODF)
US Builders, Hovnanian (HOV), Pulte (PHM), Centex (CTX)
US T-Bonds, eft for (TLT)
US Ten Year bond Yields (TNX)
. . . UK Builder Index ("Combi-5") as UPDATED by Spline
-see- : http://www.houseprices.uk.net/articles/house_builders_index/
. . . UK Builder Index ("Combi-5") adjusted for FTSE / Original chart:
. . . (If the Blue lines continues to fall, it shows sentiment towards Property
. . . owning is declining, and Property Indices may follow it down.)
WHAT DOES THIS chart represent? Does it tell us anything about the future?
Wouldn't it be great if you could get an advance indication of the various House Price Indices on a daily basis, weeks before the Official indices are released. And, how would you like to see a technical method which sums up, an a single figure, the pressure pushing UK property lower or higher?
Well there is an Indicator that I have been working to create... which may do that.
The system that I have developed involves looking at the stock charts for Five UK Homebuilders, and measuring how "bearish" the charts look in relation to moving averages. The stocks involved are UK Builders: Wimpey (WMPY), Barratt (BDEV), Persimmon (PSN), Wilson Bowden (WLB), and Balfour Beatty (BBY).
First, I add up all five stock prices, to arrive at a total for the Five Builders. At the end of 2004, the combined total was 3,143. By the end of July 2005, the total had reached 3,444- an increase of 9.6%. It is not so easy to compare this directly with the House Price Indices, so I convert these raw total figures into an "5-Combi" Index, by dividing each figure by the end Dec.2003 amount (2,680), and then multiplying by 100, to get an index which has a 100.0 value at the end of 2003. This method of calculation, gives me an index figure of 117.28 for Dec.2004, and 128.51 for the end of July 2005. These figures can now be readily compared with published index figures, in this example the figures are from Rightmove:
This measure does not go far enough. Some of the increase in the price of the Builder share prices is due to a general increase in buying appetite for stocks in general, and I want to compensate for this influence also. Thus, I add an adjustment for the level of the FTSE. I calculate another index, which is the current level of the FTSE, divided by the FTSE level at Dec.2003 (4,477). This shows me how much the average stock the FTSE has increased or decreased. I then take the Combi.Index and DIVIDE it by the FTSE index. Results are shown on the following table:
Month= 5-Builders, 5-Combi FTSE:index 5c/Ft: London, Index : Eng.&W, Index
12/2001 : 2,018 . ,. 74.59 5217=116.5. 64.6: 212,900. 82.3 : 127,882. 74.8
12/2002 : 1,942 . ,. 72.46 3940= 88.0. 82.3: 259,001 100.2 : 156,084. 91.2
12/2003 : 2,680 . , 100.00 4477=100.0 100.0: 258,571 100.0 : 171,055 100.0
06/2004 : 2,915 . , 108.77 4464= 99.7 109.1: 288,385 111.5 : 193,965 113.4
12/2004 : 3,143 . , 117.28 5113=114.2 111.1: 274,343 106.1 : 189,733 110.9
07/2005 : 3,444 . , 128.51 5282=118.0 108.9: 284,887 110.2 : 196,282 114.7
If you look back at the chart at the top of the Header, you will see that the adjusted Combi-5 index correlates with the Property price indices, and even tends to lead by about 2-3 months.
Finally, I want to get an idea of the current trend. To measure how the stocks look technically on charts, I also calculate what I call, a "Downward Pressure Index". To get this: For each stock, I compile a figure from 0 to 20, with 20 being a FULL RED signal, where that stock is trading below its 1month moving average, the stock below its 12month moving average, and the stock has been trading down long enough that the two moving averages have rolled over and the 1month moving average has fallen below the 12 months. In others words, the stock has shown a sharp drop, not just a dip. If all 5 stocks are at Full Red, then the DPI index would have a score of 100/100, ie 100%.
To see how this DPI works, let's see how the measure worked in a recent week.
Following is a list of the Five companies in the Combined Builder's Index and the DPI:
SYM. Company=== (Low - High) Last : Score*
WMPY Wimpey......... (334 - 495p) 399p : - 9
BDEV Barratt Dev..... (477 - 741p) 672p : - 5
PSN- Persimmon...... (586 - 837p) 801p : - 0
WLB- Wilson Bowden (950 -1273p)1118p : - 2
BBY- Balfour Beatty.. (250 - 362p) 333p : - 5
-----------------------
Combined 5 Builders ...Totals... 3,323 /DPI -18
- - -
*Scoring Key: Add up the following, if they apply:
0: Stock above both 1mo & 1year MAs..... (score: 0)
2: Stock below 1mo/21d MA ...................... (score: 2)
3: 21d MA is moving lower ........................ (score: 3)
4: 21d MA has crossed below 252d MA........ (score: 4)
5: Stock below 1yr/252d MA ...................... (score: 5)
6: 252d MA is moving lower ....................... (score: 6)
Full RED! .: If all if the above apply............ (score: 20)
MA : Moving Average: 1month=21 days / 1year=252 days
= = =
= = = = =
DATA BANK...
R-Move WMPY BDEV== PSN-== WLB-=== BBY-== : TotL Ipts
N .. 185- 4 366- 0 322- 0. 754-11 179- 0 =
D .. 220- 0 424- 0 384- 0. 805- 0 166-14 :=1999-14
J'02 228- 0 415- 3 388- 3. 838- 0 207- 0 : 2076- 6
F .. 266- 0 450- 0 431- 0. 887- 0 233- 0 : 2267- 0
M .. 276- 0 476- 0 423- 2. 911- 0 213- 5 : 2299- 7
A .. 291- 0 480- 0 453- 0. 938- 0 268- 0 : 2437- 0
M .. 289- 5 460- 5 440- 5. 884- 3 242- 5 : 2315-13
J .. 268- 5 420- 5 398- 5. 870- 3 233- 3 : 2189-21
Jl . 244- 5 352-14 384- 7. 796- 9 191-14 : 1967-49
A .. 287- 0 420- 5 456- 0. 917- 0 197-12 : 2277-17
S .. 287- 2 423- 2 443- 5. 852- 5 139-20 : 2144-34
O .. 263- 5 406- 9 424- 5. 834-14 163- 9 : 2116-42
N .. 240- 9 405-14 415-12. 796 14 165 15 : 2021 64 N ..
D .. 255- 9 390- 9 423- 5. 728 20 146 18 : 1942 61 D ..
J'03 246-14 372-20 418-10. 700-20 160-15 : 1896-79 J'03
F .. 270- 9 407-15 450- 0. 779-15 156-17 : 2062-56 F ..
M .. 238-20 390-17 377-20. 764-20 147-20 : 1916-97 M ..
A .. 242-17 406-15 403-15. 854- 6 188- 6 : 2093-59 A ..
M .. 284- 5 470- 0 467- 0. 908- 0 197- 6 : 2326-11 M ..
J .. 283- 2 430- 5 474- 2. 960- 0 195-11 : 2342-20 J ..
Jl . 342- 0 484- 0 532- 0. 979- 0 186- 7 : 2523- 7 Jl .
A .. 390- 0 518- 0 572- 0 1061- 0 216- 6 : 2757- 6 A ..
S .. 364- 5 508- 5 539- 5 1050- 5 202- 5 : 2663-25 S ..
O .. 325- 5 476- 5 462- 5. 960- 5 200- 5 : 2423-25 O ..
N .. 340- 0 485- 0 466- 0. 978- 0 217- 0 : 2486- 0 N ..
D .. 371- 0 538- 0 530- 0 1028- 0 213- 5 : 2680- 5 D ..
J'04 358- 0 509- 0 540- 0. 945- 5 231- 0 : 2583- 5 J'04
F .. 385- 0 555- 0 572- 0 1090- 0 248- 0 : 2850- 0 F ..
M .. 436- 0 622- 0 692- 0 1056- 0 260- 2 : 3066- 2 M ..
A .. 418- 5 627- 0 662- 5 1092- 5 255- 5 : 3054-20 A ..
M .. 368- 9 572- 5 600- 5 1034- 5 248- 5 : 2822-29 M ..
J .. 375- 6 587- 0 623- 0 1063- 0 267- 0 : 2915- 6 J ..
Jl . 370- 9 561- 3 585- 5. 983- 0 267- 2 : 2766-19 Jl .
A .. 414- 0 581- 0 667- 0 1114- 3 263- 3 : 3039- 6 A ..
S .. 403- 5 564- 5 660- 5 1076- 5 277- 0 : 2980-20 S ..
O .. 350-14 503-14 616- 5. 974-14 273- 5 : 2716-52 O ..
N .. 357- 9 514-14 616- 5. 976-12 304- 0 : 2767-40 N ..
D .. 405- 0 595= 0 688- 0 1140- 0 315- 0 : 3143- 0: xxxx% /117.28 4814/109.07
R-Move WMPY BDEV== PSN-== WLB-=== BBY-== : Tot.Ipt: Gilt% / 26.80 /FTSE x4477
J'05 412- 0 603- 0 692- 0 1138- 0 340- 0 : 3185- 0: 4.60% /118.84 4852/109.66
F .. 471- 0 672- 0 778- 0 1234- 0 320- 5 : 3475- 5: 4.74% /129.66 4969/117.02
M .. 447- 5 660- 5 768- 2 1186- 5 313- 5 : 3374-22: 4.74% /125.90 4894/115.17
A .. 389- 9 593- 5 676- 5 1076- 9 303- 5 : 3037-33: 4.53% /113.32 4802/105.65
M .. 431- 8 660- 0 750- 0 1147- 0 322- 0 : 3310- 8: 4.39% /123.51 4964/111.39
J .. 439- 2 716- 0 780- 2 1135- 5 330- 0 : 3400- 9: 4.19% /126.87 5113/111.09
Jl . 426- 5 720- 0 800- 0 1150- 5 348- 0 : 3444-10: 4.29% /128.51 5282/108.92
A .. 410- 7 707- 3 829- 0 1139- 0 331- 5 : 3416-15: 4.14% /127.54 5329/107.14
S .. 428- 0 756- 0 858- 0 1166- 0 328- 3 : 3536- 3: 4.26% /131.94 5478/107.83
O .. 409-10 804- 0 862- 0 1124- 5 305-14 : 3504-29: 4.32% /130.75 5315/110.13
N .. 438- 2 906- 0 1105-0 1300- 0 336- 0 : 4085- 2: 4.19% /152.43 5423/125.84
D .. 480- 0 986- 0 1258-0 1450- 0 356- 0 : 4530- 0: 4.12% /169.03 5619/134.68
R-Move WMPY BDEV== PSN-== BDEV1.92* BBY- : Tot.Ipt: Gilt% / 26.80 /FTSE x4477
J'07 538- ? 1182-? 1386-? 2287- ? 417- ? : 5810- ?: ?.??% /216.79 6203/156.47
F .. 569- ? 1178-? 1396-? 2160- ? 454- ? : 5757- ?: ?.??% /214.81 6172/155.82
M .. 636- ? 1105-? 1406-? 2115- ? 477- ? : 5739- ?: ?.??% /214.14 6308/151.98
A .. 587- ? 1086-? 1347-? 2085- ? 469- ? : 5574- ?: ?.??% /207.99 6449/144.39
M .. 628- ? 1091-? 1366-? 2095- ? 460- ? : 5640- ?: ?.??% /210.44 6621/142.30
Date: -TW-- 1.39xTW BDEV- PSN-- -BDVx1.92 -BBY- Tot.Idx/26.80 /FTSE x4477
Jl .. 360.75 501.44 993.0 1158.0 1906.56 443.00 5002.0 186.64 6608 126.45
jul13 334.75 465.30 969.5 1167.0 1861.44 453.00 4916.2 183.44 6717 122.27
===
*note:
WLB was taken over by BDEV on... 26 Apr 2007
20 april /prices were: wlb-2123 / bdev-1107 : 1.918
(from apr.07, used 1.92xbdev
Fridays in 2005:
A19. 399- 9 672- 5 801- 0 1118- 2 333- 5 : 3323-18: 4.27% /123.99 5311/104.51
A2
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