Self-proclaimed technical analysis "doyen" Clive Roffey claims he is the victim of a "malicious personal vendetta" launched against him.
Roffey is a well-known TV and radio personality. He has a regular spot on Summit TV (sponsored by Subaru) where he offers market tips.
The perpetrator of the "vendetta" is amateur trader Mark van der Byl. Roffey has threatened to sue him for alleged "personal and professional damages".
Van der Byl made comments about Roffey on an internet forum hosted by Standard Bank (that is accessible only to its trading clients) as well as a letter of complaint that was addressed to the Financial Technical Analyst's Society of South Africa (Tassa).
Van der Byl says he thinks Roffey was irresponsible in punting DRD single-stock futures to his followers when it was trading at about R10. DRD shares are currently R5,19. He argues that DRD was clearly in a technical downtrend, with no sign of a reversal.
His main objections are as follows:
- Roffey did not provide adequate "health warnings" when advising followers to bet on a risky share (DRD), using a risky instrument (SSF).
"I objected to the language Roffey used," says Van der Byl. "He used terms such as: ‘without a doubt.... stock up on the golds including DRD before Christmas and go away on holiday and forget about it... anyone that doesn't buy DRD is stupid... DRD has to go to R21' etc."
- There is no evidence that Roffey is a registered financial adviser in terms of the Financial Advisory and Intermediary Services (Fais) Act.
- His apparently unsubstantiated claim that his stock market tips are "right" 80% of the time.
- Roffey's assertion that the gold index would "way outperform" general equities in 2006. When Van der Byl asked Roffey to comment on how the All Share index had actually outperformed the gold index by about 50% the previous year, he first replied in an e-mail: "Over the past 12 months the gold shares have under performed by about 5% and not 50%."
When Van der Byl later asked the technical analysis guru to explain his maths, Roffey refused to enter into any further conversation with him. "Stuff like this is totally unacceptable," argues Van der Byl. "You cannot change the facts to make yourself look better."
In his complaint to Tassa, Van der Byl wrote that Roffey "continues to bring the discipline of technical analysis and the Tassa into disrepute".
Society Chairman Victor Hugo promptly forwarded a copy of the complaint to Roffey, his fellow board member.
An enraged Roffey not only e-mailed Van der Byl with a threat of legal action, but also his boss. "As he [Van der Byl] has conducted his malicious personal vendetta and levelled his accusations through the auspices of your company's e-mail system I must assume that you, your co-directors and company are fully aware of his actions and are in agreement with them and as such your company and you personally will become intimately involved in any action that I will take," ranted Roffey to Van der Byl's boss.
At the time of writing, Hugo had failed to respond to a question submitted by Moneyweb asking him if Tassa has any minimum qualification or regulatory requirements for its members such as registration with the Financial Services Board.
Roffey the doyen
On his website, http://www.charts.co.za/, Roffey boasts that "no other analyst in South Africa has such a phenomenal track record of forecasting major market turns before they happened". (Moneyweb wonders how it is possible to forecast something after it happened.)
The site provides details of many of Roffey's successful "forecasts". Mysteriously, it is short on details of his failures.
Given his long and successful career in "forecasting major market turns", one would expect Roffey to be a millionaire many times over, perhaps even a billionaire. However rich he might be, Roffey does not seem to miss an opportunity to drum up extra cash. When doing this, his marketing style can bear an eerie similarity to that normally employed by casinos and boiler rooms.
For example, Moneyweb was surprised in July 2005 to find a small ad in the Business Day that stated: "If my share analyses fail to make 50% a year I guarantee to refund your full subscription!"
It only became apparent that Roffey was behind the ad once we had responded to it. We learnt that for R9 880 a year, he would undertake to provide buy and sell recommendations. Roffey claimed that the service was limited to only 100 subscribers. This was "to maintain a level of exclusivity".
Not always right
It is not just Van der Byl who is unimpressed with Roffey's services. Roffey used to write for a well known trading publication. In an e-mail, the editor of the publication told Van der Byl that he had to "let Roffey go" after he had called Gold Fields shares a buy all the way down from their high.
No comment for MoneywebMoneyweb's attempts to get Roffey's side of the story were unceremoniously dead-ended. His only comment was: "I don't discuss matters with Moneyweb. Thank you. Goodbye."