From: owner-canslim-digest@lists.xmission.com (canslim-digest) To: canslim-digest@lists.xmission.com Subject: canslim-digest V2 #1175 Reply-To: canslim Sender: owner-canslim-digest@lists.xmission.com Errors-To: owner-canslim-digest@lists.xmission.com Precedence: bulk Content-Transfer-Encoding: quoted-printable X-No-Archive: yes canslim-digest Saturday, March 3 2001 Volume 02 : Number 1175 In this issue: Re: [CANSLIM] Worth thinking about RE: [CANSLIM] Worth thinking about Re: [CANSLIM] Worth thinking about [CANSLIM] Thanks for the Fund Info Re: [CANSLIM] Worth thinking about - whole paragraph Re: [CANSLIM] Worth thinking about Re: [CANSLIM] Worth thinking about [CANSLIM] Re: Dave Cameron's post Re: [CANSLIM] Worth thinking about Re: [CANSLIM] Worth thinking about - whole paragraph [CANSLIM] Size of company [CANSLIM] More on changes in CANSLIM Re: [CANSLIM] Worth thinking about Re: [CANSLIM] Size of company ---------------------------------------------------------------------- Date: Sat, 3 Mar 2001 17:58:04 -0500 From: "Tom Worley" Subject: Re: [CANSLIM] Worth thinking about Bill, When I compare 1990 to the present, the biggest difference I see is the availability of information today, and the awareness of the markets. In 1990, I was an active broker with several hundred clients. I spoke to some every few days, others only every several months. None had a computer at home which they used for information about the markets. Many did not even follow the market or listen to the commentators on TV, all they knew about what was happening in the markets was what I told them. Today, it seems even the most casual of investors I know are following the markets, use the internet for information, listen to TV reports, etc. I suspect that level of awareness and sophistication also holds true for institutional money managers, who are likely as confused as we are. So if the bottom is clearly reached, even without an immediate turnaround in earnings, I expect the climb back out of the hole may be swift. It won't be a complete climb initially, just enough to offset the extreme oversold conditions on NASDAQ and, to a lesser degree, NYSE. Expectations have been so lowered that I anticipate that partial climb happening prior to the release of Q2 results. After that, it will depend on the quality of earnings reports for Q2 whether the recovery is sustainable or not. Bear in mind that the general definition of recession is at least two consecutive quarters of negative GDP (Gross Domestic Production). Since GDP in the Fourth Quarter rose 1.1%, that means that it would have to decline for the first half of this year to achieve a recession status. With manufacturing activity and consumer spending already showing signs of picking up, and that's without the effects yet of the Fed rate cuts already done, I see no reason to believe we will get even one quarter of GDP declining. When the turnaround happens, it is likely IMO that it will be on the basis of perception (e.g. emotion) rather than substantive reasons like earnings. I think that process is already occurring, accounting for the several recent days when the market rallied, or attempted to, even in the face of further bad earnings reports. One of these days the optimists will win decisively over the bears, and then the bulls will take over again. Tom Worley stkguru@netside.net ICQ # 5568838 - ----- Original Message ----- From: Bill Triffet To: Sent: Saturday, March 03, 2001 3:19 PM Subject: Re: [CANSLIM] Worth thinking about Ton, Well then maybe there's hope! (g) In Fridays Investors Corner the topic was, " Earnings Don't Add Up As Market Indicator". Goes on to say in 1990 earnings fell from year ago levels. But (and a big but IMHO), investor bearish sentiment shot up to 56%. I realize this may mean nothing in todays fast paced markets or could be somthing. I don't know. This is all a real learning experience for me. Being a post 1992 investor I have no real experience (unlike those baby faced anylists on tv) with what a real bottom going into a real start of a new bull looks like other than what I read. It will be interesting to see how it unfolds. Will it be a tricle out of defensive to high growth or a mad rush? With so much information available now it seems that every move is countered with an equal reversal. Time will tell... - -Bill Triffet - ----- Original Message ----- From: "Tom Worley" To: "CANSLIM" Sent: Saturday, March 03, 2001 9:36 AM Subject: [CANSLIM] Worth thinking about >From Money Daily: So far, about 570 companies have put out first-quarter forecasts, and more than two-thirds, or 384 of them, have warned of lower-than-expected earnings, according to market research firm First Call/Thomson Financial. Tom Worley stkguru@netside.net ICQ # 5568838 - - - - ------------------------------ Date: Sat, 3 Mar 2001 17:53:11 -0500 From: "Ann Hollingworth" Subject: RE: [CANSLIM] Worth thinking about I subscribe to IBD, but my Friday issue didn't arrive. Is there any way to go back to the Fri. issue on the website? Ann Hollingworth Reading Recovery Teacher Massachusetts - -----Original Message----- From: owner-canslim@lists.xmission.com [mailto:owner-canslim@lists.xmission.com]On Behalf Of Bill Triffet Sent: Saturday, March 03, 2001 3:19 PM To: canslim@lists.xmission.com Subject: Re: [CANSLIM] Worth thinking about Ton, Well then maybe there's hope! (g) In Fridays Investors Corner the topic was, " Earnings Don't Add Up As Market Indicator". Goes on to say in 1990 earnings fell from year ago levels. But (and a big but IMHO), investor bearish sentiment shot up to 56%. I realize this may mean nothing in todays fast paced markets or could be somthing. I don't know. This is all a real learning experience for me. Being a post 1992 investor I have no real experience (unlike those baby faced anylists on tv) with what a real bottom going into a real start of a new bull looks like other than what I read. It will be interesting to see how it unfolds. Will it be a tricle out of defensive to high growth or a mad rush? With so much information available now it seems that every move is countered with an equal reversal. Time will tell... - -Bill Triffet - - ------------------------------ Date: Sat, 3 Mar 2001 17:38:02 -0600 From: "Norman" Subject: Re: [CANSLIM] Worth thinking about Ann, As far as I know only the Investor's Corner is archived and accessible on the web site. I have suggested that they archive more of the articles so that folks wouldn't have to create a fire hazard by hanging onto all the back copies :-) Norman Boyd - ----- Original Message ----- From: "Ann Hollingworth" To: Sent: Saturday, March 03, 2001 4:53 PM Subject: RE: [CANSLIM] Worth thinking about > I subscribe to IBD, but my Friday issue didn't arrive. Is there any way to > go back to the Fri. issue on the website? > > Ann Hollingworth > Reading Recovery Teacher > Massachusetts > > -----Original Message----- > From: owner-canslim@lists.xmission.com > [mailto:owner-canslim@lists.xmission.com]On Behalf Of Bill Triffet > Sent: Saturday, March 03, 2001 3:19 PM > To: canslim@lists.xmission.com > Subject: Re: [CANSLIM] Worth thinking about > > Ton, > > Well then maybe there's hope! (g) > In Fridays Investors Corner the topic was, " Earnings Don't Add Up As Market > Indicator". Goes on to say in 1990 earnings fell from year ago levels. But > (and a big but IMHO), investor bearish sentiment shot up to 56%. I realize > this may mean nothing in todays fast paced markets or could be somthing. I > don't know. > > This is all a real learning experience for me. Being a post 1992 investor I > have no real experience (unlike those baby faced anylists on tv) with what a > real bottom going into a real start of a new bull looks like other than what > I read. It will be interesting to see how it unfolds. Will it be a tricle > out of defensive to high growth or a mad rush? With so much information > available now it seems that every move is countered with an equal reversal. > > Time will tell... > > -Bill Triffet > > - > > - - ------------------------------ Date: Sat, 3 Mar 2001 17:41:27 -0600 From: "BW Smith" Subject: [CANSLIM] Thanks for the Fund Info Thanks to all of you for the good discussion concerning mutual funds. The various views pretty well covered all aspects concerning whether to hold or to sell funds during a market downturn. LOL, for a few hours I was confused on a much higher level, but after re-reading the messages the confusion dissolved. Hopefully not many folks considered the subject to be too far off topic. Bill Smith - - ------------------------------ Date: Sat, 3 Mar 2001 17:52:53 -0600 From: "The Curry's" Subject: Re: [CANSLIM] Worth thinking about - whole paragraph The Friday IBD "Investor's Corner" titled "Earnings Don't Add up as Market Indidcator" is a very interesting article, as usual, and relevent to what we are experiencing. The whole paragraph Bill is referring to: "In 1990, S&P earnings fell from year-ago levels. Meanwhile, bearishness amoung newsletter writers tracked by Investors Intellegence shot up to 56% in September 1990 while bulls dropped to 28%. When bears outnumber bulls, it usually means that most inveestors have already sold out. With no more potential sellers around, stock prices begins to rise again. In October, the market began a new bull run." Earlier in the article... "What will it take to end the current bear market?" The biggest factor is institutional investors. Since they make up as much as 80% of the market's volume, their buying prowess starts new bull markets." - --Patti - ----- Original Message ----- From: "Bill Triffet" To: Sent: Saturday, March 03, 2001 2:19 PM Subject: Re: [CANSLIM] Worth thinking about > Ton, > > Well then maybe there's hope! (g) > In Fridays Investors Corner the topic was, " Earnings Don't Add Up As Market > Indicator". Goes on to say in 1990 earnings fell from year ago levels. But > (and a big but IMHO), investor bearish sentiment shot up to 56%. I realize > this may mean nothing in todays fast paced markets or could be somthing. I > don't know. > > This is all a real learning experience for me. Being a post 1992 investor I > have no real experience (unlike those baby faced anylists on tv) with what a > real bottom going into a real start of a new bull looks like other than what > I read. It will be interesting to see how it unfolds. Will it be a tricle > out of defensive to high growth or a mad rush? With so much information > available now it seems that every move is countered with an equal reversal. > > Time will tell... > > > -Bill Triffet > > ----- Original Message ----- > From: "Tom Worley" > To: "CANSLIM" > Sent: Saturday, March 03, 2001 9:36 AM > Subject: [CANSLIM] Worth thinking about > > > >From Money Daily: > > So far, about 570 companies have put out first-quarter forecasts, and more > than two-thirds, or 384 of them, have warned of lower-than-expected > earnings, according to market research firm First Call/Thomson Financial. > > Tom Worley > stkguru@netside.net > ICQ # 5568838 > > > > > > - > > - - ------------------------------ Date: Sat, 3 Mar 2001 15:55:45 -0800 From: "Bill Triffet" Subject: Re: [CANSLIM] Worth thinking about Ann, I don't see a link for archived articles. Perhaps something they should add. As far as your missed delivery, I'd call them up or use the website link for customer service. I've had some spotty service in the past (not any more). They've been great about re-delivering the issue and extending your subsription by one day. That also includes wet papers caused by my sprinklers. (g) - -Bill Triffet - ----- Original Message ----- From: "Ann Hollingworth" To: Sent: Saturday, March 03, 2001 2:53 PM Subject: RE: [CANSLIM] Worth thinking about > I subscribe to IBD, but my Friday issue didn't arrive. Is there any way to > go back to the Fri. issue on the website? > > Ann Hollingworth > Reading Recovery Teacher > Massachusetts > > -----Original Message----- > From: owner-canslim@lists.xmission.com > [mailto:owner-canslim@lists.xmission.com]On Behalf Of Bill Triffet > Sent: Saturday, March 03, 2001 3:19 PM > To: canslim@lists.xmission.com > Subject: Re: [CANSLIM] Worth thinking about > > Ton, > > Well then maybe there's hope! (g) > In Fridays Investors Corner the topic was, " Earnings Don't Add Up As Market > Indicator". Goes on to say in 1990 earnings fell from year ago levels. But > (and a big but IMHO), investor bearish sentiment shot up to 56%. I realize > this may mean nothing in todays fast paced markets or could be somthing. I > don't know. > > This is all a real learning experience for me. Being a post 1992 investor I > have no real experience (unlike those baby faced anylists on tv) with what a > real bottom going into a real start of a new bull looks like other than what > I read. It will be interesting to see how it unfolds. Will it be a tricle > out of defensive to high growth or a mad rush? With so much information > available now it seems that every move is countered with an equal reversal. > > Time will tell... > > -Bill Triffet > > - > > - - ------------------------------ Date: Sat, 3 Mar 2001 16:30:28 -0800 From: "Bill Triffet" Subject: Re: [CANSLIM] Worth thinking about Tom, Thanks for the insight. I agree with you about perception. I learned long ago that for the most, part perception is reality. As someone once said, " A recesssion is when you know people that can't find work. A depression is when YOU can't find work". That fact that I find it hard right now to look for breakouts due to so many failed ones might be a good omen. - -Bill Triffet - ----- Original Message ----- From: "Tom Worley" To: Sent: Saturday, March 03, 2001 2:58 PM Subject: Re: [CANSLIM] Worth thinking about > Bill, > > When I compare 1990 to the present, the biggest difference I see > is the availability of information today, and the awareness of > the markets. In 1990, I was an active broker with several hundred > clients. I spoke to some every few days, others only every > several months. None had a computer at home which they used for > information about the markets. Many did not even follow the > market or listen to the commentators on TV, all they knew about > what was happening in the markets was what I told them. > > Today, it seems even the most casual of investors I know are > following the markets, use the internet for information, listen > to TV reports, etc. I suspect that level of awareness and > sophistication also holds true for institutional money managers, > who are likely as confused as we are. So if the bottom is clearly > reached, even without an immediate turnaround in earnings, I > expect the climb back out of the hole may be swift. It won't be a > complete climb initially, just enough to offset the extreme > oversold conditions on NASDAQ and, to a lesser degree, NYSE. > > Expectations have been so lowered that I anticipate that partial > climb happening prior to the release of Q2 results. After that, > it will depend on the quality of earnings reports for Q2 whether > the recovery is sustainable or not. > > Bear in mind that the general definition of recession is at least > two consecutive quarters of negative GDP (Gross Domestic > Production). Since GDP in the Fourth Quarter rose 1.1%, that > means that it would have to decline for the first half of this > year to achieve a recession status. With manufacturing activity > and consumer spending already showing signs of picking up, and > that's without the effects yet of the Fed rate cuts already done, > I see no reason to believe we will get even one quarter of GDP > declining. > > When the turnaround happens, it is likely IMO that it will be on > the basis of perception (e.g. emotion) rather than substantive > reasons like earnings. I think that process is already > occurring, accounting for the several recent days when the market > rallied, or attempted to, even in the face of further bad > earnings reports. One of these days the optimists will win > decisively over the bears, and then the bulls will take over > again. > > Tom Worley > stkguru@netside.net > ICQ # 5568838 > > > ----- Original Message ----- > From: Bill Triffet > To: > Sent: Saturday, March 03, 2001 3:19 PM > Subject: Re: [CANSLIM] Worth thinking about > > > Ton, > > Well then maybe there's hope! (g) > In Fridays Investors Corner the topic was, " Earnings Don't Add > Up As Market > Indicator". Goes on to say in 1990 earnings fell from year ago > levels. But > (and a big but IMHO), investor bearish sentiment shot up to 56%. > I realize > this may mean nothing in todays fast paced markets or could be > somthing. I > don't know. > > This is all a real learning experience for me. Being a post 1992 > investor I > have no real experience (unlike those baby faced anylists on tv) > with what a > real bottom going into a real start of a new bull looks like > other than what > I read. It will be interesting to see how it unfolds. Will it be > a tricle > out of defensive to high growth or a mad rush? With so much > information > available now it seems that every move is countered with an equal > reversal. > > Time will tell... > > > -Bill Triffet > > ----- Original Message ----- > From: "Tom Worley" > To: "CANSLIM" > Sent: Saturday, March 03, 2001 9:36 AM > Subject: [CANSLIM] Worth thinking about > > > >From Money Daily: > > So far, about 570 companies have put out first-quarter forecasts, > and more > than two-thirds, or 384 of them, have warned of > lower-than-expected > earnings, according to market research firm First Call/Thomson > Financial. > > Tom Worley > stkguru@netside.net > ICQ # 5568838 > > > > > > - > > > > - > > - - ------------------------------ Date: Sat, 03 Mar 2001 16:27:46 -0800 From: Mary Keener Subject: [CANSLIM] Re: Dave Cameron's post Tom, I'll second Dave's thanks for your numerous, helpful, timely posts. I've made money researching some of the companies you've pointed out as good CANSLIM candidates. Your market analysis can match any of those I read and watch, and surpases many. Your presence on this message board has never been boring, mostly on track, always mindful of the CANSLIM principles. You are appreciated, Mary Dave Cameron wrote: > > The eminent and self-proclaimed thin skinned "stkguru", Mr > Tom Worley mentioned that he's been hanging around this > board for 4 years. To me, that was an interesting > revelation. I went back and checked the Cameron archives, > and my first interaction with Tom was on Oct 31, 1996 - > this was very close to the first day of this list (which > has been revamped). Within that time frame, Tom was > absent for a stretch or two for a few months (as part of > his thin skin persona). Of course, I've been absent for > several months on a couple of occasions due to family > matters. > > Regardless, the point I want to make is that Tom has > remained a very helpful and very active poster for the vast > majority of the last 4 years and 4 months on this list. > While he's been here, he has greeted nearly every newcomer, > encouraged nearly everyone with questions and thoughts to > share them, and posted more than probably any 3 of us > combined with relevant insights. > > Thanks Tom - I didn't realize how long its been. > > Dave Cameron > dfcameron@yahoo.com > > __________________________________________________ > Do You Yahoo!? > Get email at your own domain with Yahoo! Mail. > http://personal.mail.yahoo.com/ > > - - - ------------------------------ Date: Sat, 3 Mar 2001 16:19:13 -0800 From: "Bill Triffet" Subject: Re: [CANSLIM] Worth thinking about It is a start but now the fear has to set in...(g) - -Bill Triffet - ----- Original Message ----- From: "walter nusbaum" To: Sent: Saturday, March 03, 2001 1:15 PM Subject: Re: [CANSLIM] Worth thinking about > > ----- Original Message ----- > From: "Bill Triffet" > To: > Sent: Saturday, March 03, 2001 2:19 PM > Subject: Re: [CANSLIM] Worth thinking about > > > > Tom, > > > > Well then maybe there's hope! (g) > > In Fridays Investors Corner the topic was, " Earnings Don't Add Up As > Market > > Indicator". Goes on to say in 1990 earnings fell from year ago levels. But > > (and a big but IMHO), investor bearish sentiment shot up to 56%. I realize > > this may mean nothing in todays fast paced markets or could be somthing. I > > don't know. > > Time will tell... > (SNIP) > > -Bill Triffet > > Bill, > Also noted in the same article was a statement by Don Hays, head of > HaysAdvisory.com, "That's exactly when you want to buy, when earnings are > looking dismal". > > And from the front page of Monday's IBD....."Oracle joined the casualty > list, plunging 21% after an earlier profit warning. The news helped beat up > software stocks". Same page, different article...."Research firm Economy.com > says the the number of software jobs grew 5.5% year over year in January". > Companies are hiring as profits are weakening? Are they prescient or what? > Best wishes, > Walt > > > > >From Money Daily: > > > > So far, about 570 companies have put out first-quarter forecasts, and more > > than two-thirds, or 384 of them, have warned of lower-than-expected > > earnings, according to market research firm First Call/Thomson Financial. > > > > Tom Worley > > stkguru@netside.net > > ICQ # 5568838 > > > > > - > > - - ------------------------------ Date: Sat, 3 Mar 2001 16:32:22 -0800 From: "Bill Triffet" Subject: Re: [CANSLIM] Worth thinking about - whole paragraph Tell me editors at IBD don't look at this listserver for article ideas! (g) - -Bill Triffet - ----- Original Message ----- From: "The Curry's" To: Sent: Saturday, March 03, 2001 3:52 PM Subject: Re: [CANSLIM] Worth thinking about - whole paragraph > The Friday IBD "Investor's Corner" titled "Earnings Don't Add up as Market > Indidcator" is a very interesting article, as usual, and relevent to what > we are experiencing. The whole paragraph Bill is referring to: > > "In 1990, S&P earnings fell from year-ago levels. Meanwhile, bearishness > amoung newsletter writers tracked by Investors Intellegence shot up to 56% > in September 1990 while bulls dropped to 28%. When bears outnumber bulls, > it usually means that most inveestors have already sold out. With no more > potential sellers around, stock prices begins to rise again. In October, > the market began a new bull run." > > Earlier in the article... "What will it take to end the current bear > market?" The biggest factor is institutional investors. Since they make up > as much as 80% > of the market's volume, their buying prowess starts new bull markets." > > --Patti > > ----- Original Message ----- > From: "Bill Triffet" > To: > Sent: Saturday, March 03, 2001 2:19 PM > Subject: Re: [CANSLIM] Worth thinking about > > > > Ton, > > > > Well then maybe there's hope! (g) > > In Fridays Investors Corner the topic was, " Earnings Don't Add Up As > Market > > Indicator". Goes on to say in 1990 earnings fell from year ago levels. But > > (and a big but IMHO), investor bearish sentiment shot up to 56%. I realize > > this may mean nothing in todays fast paced markets or could be somthing. I > > don't know. > > > > This is all a real learning experience for me. Being a post 1992 investor > I > > have no real experience (unlike those baby faced anylists on tv) with what > a > > real bottom going into a real start of a new bull looks like other than > what > > I read. It will be interesting to see how it unfolds. Will it be a tricle > > out of defensive to high growth or a mad rush? With so much information > > available now it seems that every move is countered with an equal > reversal. > > > > Time will tell... > > > > > > -Bill Triffet > > > > ----- Original Message ----- > > From: "Tom Worley" > > To: "CANSLIM" > > Sent: Saturday, March 03, 2001 9:36 AM > > Subject: [CANSLIM] Worth thinking about > > > > > > >From Money Daily: > > > > So far, about 570 companies have put out first-quarter forecasts, and more > > than two-thirds, or 384 of them, have warned of lower-than-expected > > earnings, according to market research firm First Call/Thomson Financial. > > > > Tom Worley > > stkguru@netside.net > > ICQ # 5568838 > > > > > > > > > > > > - > > > > > > > - > > - - ------------------------------ Date: Sat, 3 Mar 2001 17:34:23 -0800 (PST) From: Dave Cameron Subject: [CANSLIM] Size of company I am not convinced that the size of the company makes a big difference for the short-term. My earliest successes were all with small caps. However, my most recent success have been large caps. I should point out that in both my edition of HTMMIS and the O'Neil tapes that I have, WON mentions (both in the 'S' and the 'I' part) a couple of things. He says that you want the stock to be big enough to have institutional sponsorship, but not so big that it can't move a lot. He also says that most of his biggest successes were those with less than 30 million shares outstanding. He goes on to say that you can make money in the bigger caps, but you have to be more patient. I've heard and read WON's advice on this 20+ times. In addition, David Ryan says (on the same tapes) that he's had his best success with stocks that have between 5 and 20% institutional sponsorship. This usually is more common in small caps than big caps. However over the past few years, I have had stretches where I would have done better just plopping all my money into the 5 biggest stocks in the S&P 500 over any CANSLIM attempts - including my recent unsuccessful forays into the market (because I'm too obstinate to see that "M" just ain't recovering...) I suspect this can't continue indefinitely. Or are the index funds THAT powerful? So, I am buying and selling regardless of size. But, I will have faster exit points on the upside for big caps than small caps. I believe that my best success at CANSLIM was in '93-'95 when out of 10 stocks, 5 would go down. I'd make about 10% on 4. Then the 10th stock would double. That "10th" stock was always a small cap - so I felt this was confirming O'Neil's and Ryan's experience. In the past several years, had I bought many, the large cap would have been the doubler. To me, this seriously degrades 'I' and 'S'. Essentially, any approach to the market has to be flexible - - but I don't think that any of us are practicing true CANSLIM. Lately my best stock has been SBC - a $60 million company (revenues). Go figure, Dave Cameron dfcameron@yahoo.com __________________________________________________ Do You Yahoo!? Get email at your own domain with Yahoo! Mail. http://personal.mail.yahoo.com/ - - ------------------------------ Date: Sat, 3 Mar 2001 17:38:56 -0800 (PST) From: Dave Cameron Subject: [CANSLIM] More on changes in CANSLIM Found this in the archives from "dbphoenix", one-time prolific poster who left us for the Yahoo board: - --- O'Neil's in a tough spot. Canslim was originally developed around small cap stocks - small float, not much fund interest, high mgmt ownership, steady growth over several quarters (preferably several years), etc. But PCs, the Internet, the explosion in funds (particularly index funds), the huge increase in the number of people saving for retirement (baby boomers reaching their 50s), online trading, inexpensive charting and scanning software, and, eventually, daytrading, changed everything. Quite frankly, I don't think even he understands how. If he did, he wouldn't be so far behind in establishing an Internet presence. He just doesn't seem to grasp that virtually everything that IBD has in it is available for free on the Net. This doesn't mean that canslim is worthless. But it can no longer be followed blindly. To go into all the details of how it should be adapted would require a post far longer than this. But the essentials of canslim are still worth learning. From the fundamental side, find strong companies that are the leaders in their respective industries and which have strong earnings, sales, and profit margin growth. From the technical side, buy them only when they are emerging from constructive chart patterns during periods of group and market strength. From the personal growth side, develop the discipline and the objectivity to plan your trades (even if those "trades" are for months) and to trade your plan. As long as you don't get bogged down in details, most of HTMMIS still applies. Markets are pretty much the same now as they were a hundred years ago because markets are transactions among buyers and sellers and they are just as fearful and greedy now as they were then. But now everything's faster, and the game is more often won in the mind than it is by a system. So start with that book, and supplement it with the 26-week series that we've linked to earlier. I also strongly suggest The Visual Investor by John Murphy for a good and simple explanation of charts and indicators, and Methods of a Wall Street Master by Victor Sperandeo for an explanation of trends and discipline. My site may also be of help. __________________________________________________ Do You Yahoo!? Get email at your own domain with Yahoo! Mail. http://personal.mail.yahoo.com/ - - ------------------------------ Date: Sat, 3 Mar 2001 20:39:54 -0500 From: "Tom Worley" Subject: Re: [CANSLIM] Worth thinking about Hi Bill, I agree with the article from IBD that institutional $ managers control 80% of the volume, thus it will be their actions that starts (and sustains) any rally. From my personal experience, tho, I think they are even more prone to being influenced by emotion and perception than is the individual investor as they are investing for others, and their personal success is measured by their decision making. Most mutual funds must be 95% invested as of the end of each quarter, and Q1 is just over 3 weeks away. For right now, I am sure they are either sitting on cash or have it in defensive positions. But they will want their portfolio to look good for end of quarter reporting. Just like us, they want to be right on every purchase. But unlike us, it is difficult for them to nibble around the edges. They must move in volume, so when they move, they will move decisively, right or wrong. And once one or two start plowing that money back into tech stocks (and they will, cuz that's where the strongest growth will still be for the next several years at least), then others will soon follow. Volume will be the clue, along with price gains of course, that this has started happening. Don't know if it may begin before this quarter ends, or sometime next quarter. With the Feds meeting March 20, it's less likely it will happen prior to that. With the techs so battered down, few still have an RS over 80, and a lot of the big names will be prime candidates for the institutional $ mgrs. So it may be a while before they show up on any decent CANSLIM screen. From the end of the FOMC (Federal Open Market Committee) meeting to the end of the quarter will not leave mutual fund managers much time to be switching from defensive to aggressive, so may not happen until later. So the next few weeks may be very boring, or very volatile. We are now just about out of the end of year earnings reporting cycle, with all the associated warnings of future prospects. By the time the Fed meeting is over, we will be only about 3 weeks from the same process of warnings and reporting starting all over again for Q1. Should be some interesting times ahead! Tom Worley stkguru@netside.net ICQ # 5568838 - ----- Original Message ----- From: Bill Triffet To: Sent: Saturday, March 03, 2001 7:30 PM Subject: Re: [CANSLIM] Worth thinking about Tom, Thanks for the insight. I agree with you about perception. I learned long ago that for the most, part perception is reality. As someone once said, " A recesssion is when you know people that can't find work. A depression is when YOU can't find work". That fact that I find it hard right now to look for breakouts due to so many failed ones might be a good omen. - -Bill Triffet - ----- Original Message ----- From: "Tom Worley" To: Sent: Saturday, March 03, 2001 2:58 PM Subject: Re: [CANSLIM] Worth thinking about > Bill, > > When I compare 1990 to the present, the biggest difference I see > is the availability of information today, and the awareness of > the markets. In 1990, I was an active broker with several hundred > clients. I spoke to some every few days, others only every > several months. None had a computer at home which they used for > information about the markets. Many did not even follow the > market or listen to the commentators on TV, all they knew about > what was happening in the markets was what I told them. > > Today, it seems even the most casual of investors I know are > following the markets, use the internet for information, listen > to TV reports, etc. I suspect that level of awareness and > sophistication also holds true for institutional money managers, > who are likely as confused as we are. So if the bottom is clearly > reached, even without an immediate turnaround in earnings, I > expect the climb back out of the hole may be swift. It won't be a > complete climb initially, just enough to offset the extreme > oversold conditions on NASDAQ and, to a lesser degree, NYSE. > > Expectations have been so lowered that I anticipate that partial > climb happening prior to the release of Q2 results. After that, > it will depend on the quality of earnings reports for Q2 whether > the recovery is sustainable or not. > > Bear in mind that the general definition of recession is at least > two consecutive quarters of negative GDP (Gross Domestic > Production). Since GDP in the Fourth Quarter rose 1.1%, that > means that it would have to decline for the first half of this > year to achieve a recession status. With manufacturing activity > and consumer spending already showing signs of picking up, and > that's without the effects yet of the Fed rate cuts already done, > I see no reason to believe we will get even one quarter of GDP > declining. > > When the turnaround happens, it is likely IMO that it will be on > the basis of perception (e.g. emotion) rather than substantive > reasons like earnings. I think that process is already > occurring, accounting for the several recent days when the market > rallied, or attempted to, even in the face of further bad > earnings reports. One of these days the optimists will win > decisively over the bears, and then the bulls will take over > again. > > Tom Worley > stkguru@netside.net > ICQ # 5568838 > > > ----- Original Message ----- > From: Bill Triffet > To: > Sent: Saturday, March 03, 2001 3:19 PM > Subject: Re: [CANSLIM] Worth thinking about > > > Ton, > > Well then maybe there's hope! (g) > In Fridays Investors Corner the topic was, " Earnings Don't Add > Up As Market > Indicator". Goes on to say in 1990 earnings fell from year ago > levels. But > (and a big but IMHO), investor bearish sentiment shot up to 56%. > I realize > this may mean nothing in todays fast paced markets or could be > somthing. I > don't know. > > This is all a real learning experience for me. Being a post 1992 > investor I > have no real experience (unlike those baby faced anylists on tv) > with what a > real bottom going into a real start of a new bull looks like > other than what > I read. It will be interesting to see how it unfolds. Will it be > a tricle > out of defensive to high growth or a mad rush? With so much > information > available now it seems that every move is countered with an equal > reversal. > > Time will tell... > > > -Bill Triffet > > ----- Original Message ----- > From: "Tom Worley" > To: "CANSLIM" > Sent: Saturday, March 03, 2001 9:36 AM > Subject: [CANSLIM] Worth thinking about > > > >From Money Daily: > > So far, about 570 companies have put out first-quarter forecasts, > and more > than two-thirds, or 384 of them, have warned of > lower-than-expected > earnings, according to market research firm First Call/Thomson > Financial. > > Tom Worley > stkguru@netside.net > ICQ # 5568838 > > > > > > - > > > > - > > - - - - ------------------------------ Date: Sat, 3 Mar 2001 20:46:34 -0500 From: "Tom Worley" Subject: Re: [CANSLIM] Size of company Dave, to expand your point further, the Russell 2000 (all small caps, almost all on NASDAQ) seems to be tracking pretty well with the NYSE Composite Index (mid and large caps mostly) and is substantially outperforming the NASDAQ. Tom Worley stkguru@netside.net ICQ # 5568838 - ----- Original Message ----- From: Dave Cameron To: Sent: Saturday, March 03, 2001 8:34 PM Subject: [CANSLIM] Size of company I am not convinced that the size of the company makes a big difference for the short-term. My earliest successes were all with small caps. However, my most recent success have been large caps. I should point out that in both my edition of HTMMIS and the O'Neil tapes that I have, WON mentions (both in the 'S' and the 'I' part) a couple of things. He says that you want the stock to be big enough to have institutional sponsorship, but not so big that it can't move a lot. He also says that most of his biggest successes were those with less than 30 million shares outstanding. He goes on to say that you can make money in the bigger caps, but you have to be more patient. I've heard and read WON's advice on this 20+ times. In addition, David Ryan says (on the same tapes) that he's had his best success with stocks that have between 5 and 20% institutional sponsorship. This usually is more common in small caps than big caps. However over the past few years, I have had stretches where I would have done better just plopping all my money into the 5 biggest stocks in the S&P 500 over any CANSLIM attempts - including my recent unsuccessful forays into the market (because I'm too obstinate to see that "M" just ain't recovering...) I suspect this can't continue indefinitely. Or are the index funds THAT powerful? So, I am buying and selling regardless of size. But, I will have faster exit points on the upside for big caps than small caps. I believe that my best success at CANSLIM was in '93-'95 when out of 10 stocks, 5 would go down. I'd make about 10% on 4. Then the 10th stock would double. That "10th" stock was always a small cap - so I felt this was confirming O'Neil's and Ryan's experience. In the past several years, had I bought many, the large cap would have been the doubler. To me, this seriously degrades 'I' and 'S'. Essentially, any approach to the market has to be flexible - - but I don't think that any of us are practicing true CANSLIM. Lately my best stock has been SBC - a $60 million company (revenues). Go figure, Dave Cameron dfcameron@yahoo.com __________________________________________________ Do You Yahoo!? Get email at your own domain with Yahoo! Mail. http://personal.mail.yahoo.com/ - - - - ------------------------------ End of canslim-digest V2 #1175 ****************************** To unsubscribe to canslim-digest, send an email to "majordomo@xmission.com" with "unsubscribe canslim-digest" in the body of the message. For information on digests or retrieving files and old messages send "help" to the same address. Do not use quotes in your message.