From: owner-canslim-digest@lists.xmission.com (canslim-digest) To: canslim-digest@lists.xmission.com Subject: canslim-digest V2 #3427 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 Wednesday, July 16 2003 Volume 02 : Number 3427 In this issue: RE: [CANSLIM] Market Trend Charts Re: RE: [CANSLIM] Market Wizards RE: RE: [CANSLIM] Market Wizards Re: [CANSLIM] Market Trend Charts ---------------------------------------------------------------------- Date: Wed, 16 Jul 2003 12:56:27 -0600 From: "David Taggart" Subject: RE: [CANSLIM] Market Trend Charts A great book that discusses a variety of position sizing strategies is Van Tharps "Trade Your Way To Financial Freedom" The title is lame as can be but the book is excellent. It is one of the better money management books out there IMHO. - -David Taggart - -----Original Message----- From: owner-canslim@lists.xmission.com [mailto:owner-canslim@lists.xmission.com]On Behalf Of David Taggart Sent: Wednesday, July 16, 2003 12:44 PM To: canslim@lists.xmission.com Subject: RE: [CANSLIM] Market Trend Charts %risk refers to dollars at risk if stopped out. So if you have $100,000 to trade with then for each trade at 2% you can risk $2,000 from entry to stop. Say you enter a stock at $50 and your stop is at $45 you can buy 400 shares and only be risking $2,000. I hope that helps. - -David Taggart - -----Original Message----- From: owner-canslim@lists.xmission.com [mailto:owner-canslim@lists.xmission.com]On Behalf Of Tomas Sent: Wednesday, July 16, 2003 11:57 AM To: canslim@lists.xmission.com Subject: RE: [CANSLIM] Market Trend Charts One comment on the 2% comment. The whole idea using CS is to win big when you are right, as stated by WON. So, with only an investment of 2%, how do you win BIG even if the one stock went up 100%? Of course, you can pyramid up. But if you do that then that stock/investment will be more then 2% of your portfolio. I understand that capital preservation is very important, but I 2% is a bit much or too little. You have to put a lot of eggs in one basket to win big, right? That 2% rule sounds like diworsification. just my $.02 tomas - --- Pritish Shah wrote: > Dave, > > You asked a good question on how to make money in > the range bound market. There in lies the answer > that I hope to use. If the stock market goes to the > bottom of the range, buy. If it goes to the top, > lock in your profits with a trailing stop so if a > stock goes higher, we would still be in. > > I am hoping to purchase breakouts in the top 40 or > 50 industries only and want to do legwork before > hand so I only have to make a "yes" or a "no" > decision when an alert occurs. > > I am still learning and the idea of "8% loss in a > stock should not be greater than 2% of total > portfolio" is a great. So at minimum, I should not > invest more than 1/12th of my total portfolio in any > individual stock. > > Pritish > > > >>> canslimdave2003@yahoo.com 07/15/03 23:11 PM >>> > Pritish -- > > I agree with you exactly. IMHO it will take 14 > years before the markets really break to a new high. > Well, 11 counting the three we've just been > through. In the 1968-82 period, the 1000 point > barrier was called "The Graveyard in the Sky" > because of all the rallies that failed at that > point. > > I'm very interested in learning how to apply CANSLIM > in such a range bound market. But I also want to > trade with the idea in mind that I may well be wrong > about my ideas on what the market will do. > Therefore, I'm looking for buy/sell rules that work > despite my opinions. For example, SELL if a stock > breaks its 50 day moving average. > > On thing I have come up with is the idea of getting > into the market one profitable trade at a time. > Last year, I became convinced that a bull market was > beginning and bought 6 different stocks on > breakouts, convinced that surely 1-2 would remain > above their 7-8% stop loss and therefore bail me > out. Instead, the market turned sharply against me > and I was quickly down 8+ % (because I bought some > on margin). > > This year, when the market started looking good to > me, I only put on one trade. Once that proved > profitable, I raised my stop loss level to break > even and put on a second trade. So, I've scaled my > way into the market. I am hoping that approach will > keep me from taking too big a hit if I am wrong > about market direction in the future. > > Also, I am being vigilant about limiting my > purchases so that if my 7% stop is hit, the loss is > less than 1.5% of my total portfolio. Over and over > in the Market Wizards books professional traders > talk about keeping the risk on any individual trade > to less than 2%. I don't think WON stresses this > rule enough. > > Thanks for your post! > > Dave > > Pritish Shah wrote: > Hi Kelly, > > I have been studying where I am making mistakes. A > lot of my failures were bought when Nasdaq was > touching the upper bollinger bands. Checkout the > following chart. You will notice that Nasdaq is > currently toying with the upper bollinger bands and > has been bouncing from the 20dma. So the best time > to buy would be when Nasdaq again touches 20dma and > there are a flurry of breakouts. > > http://finance.yahoo.com/q?s=^IXIC&d=c&k=c3&a=vm,m26-12-9,ss,fs&p=m20,b&t=6m &l=on&z=l&q=b > > > A lot of people have shown me charts that basically > predict that the market will churn for the next few > years and I believe that would be the trend. This is > where CANSLIM can do much better than any other > method of investing. > > Take a look at the following chart. You will notice > that from 1937 to 1950 (13 yrs), the market was > pretty much flat. From 1965 to 1983 also the market > was flat. There was also a flat period before 1930 > but that is not shown on the graph. > > http://finance.yahoo.com/q?s=^DJI&d=c&k=c3&p=&t=my&l=on&z=l&q=l > > > Basically after every major rise, the market pauses > for several years and then tries again. This has > happened 3 times on DJI. Nasdaq is currently > behaving exactly like DJI from 1930 to 1933. If it > continues to behave like DJI, for next year and > half, we are not going to go anywhere and then there > will be a major move upwards. > > I am open for discussions but not flames please. > > Thanks, > Pritish > > > >>> kelly.short@fw.us.neoris.com 07/15/03 02:40PM > >>> > Gene, > > What was in your patriotic Wheeties this morning?! > Thanks for the explanation though. Have you thought > about a career in politics because that answer was > perfectly on the middle ground. > > Okay, okay. I'll ride the trend. I'm just bitter: > three of my recent BO purchases have gotten SARS and > are in quarantine. I fear I may lose them to the > "disease", or the hurricane, or whatever ailment is > keeping them from soaring. > > That said- I did enjoy reading the information you > passed along- thanks! > > Kelly > > -----Original Message----- > From: Gene Ricci [ mailto:genr@swbell.net] > Sent: Tuesday, July 15, 2003 1:06 PM > To: canslim@lists.xmission.com > Subject: Re: [CANSLIM] Market Trend Charts > > > Kelly, forgive the clichi......... "The trend is > your friend". > > Now here's another profound statement "the trend is > up until proven otherwise". > > Many indicators are showing overbought, but they can > stay overbought for a long long time. Take last > year, they stayed oversold for a long long time. > Most likely there is a bit of consolidation going on > .... but who knows which way the break will occur. > One just has to decide at what point the trend has > changed from up to down (or sideways). And at what > point another breakout to the upside has occurred. > Each person must decide this on his/her own. > > We were told that there would not be a post war > rally - is that true? > We were told the new dividend law would not affect > stock prices - is that true? > > Although I don't see signs of a renewed bear.... I > hear them in the background.... moaning and groaning > as they try to save face after losing their > butts.... shorting this year. > > I feel that the market has to continue its upward > trend because the public wants it to (to say nothing > about the administration). When I attend meetings, > read user group email and talk to friends I'm > reminded of the Statue of Liberty.... > > "give me your tired, your poor, your huddled masses > yearning to breathe free" > > translated to: > > We're tired (poor management, manipulation, lies, > cooked books), we're poor, your investors are > yearning to once again believe!!!! ... kind of corny > but what the heck! > > Gene > > > > > ----- Original Message ----- > From: Kelly Short < > mailto:kelly.short@fw.us.neoris.com > > To: canslim@lists.xmission.com > Sent: Tuesday, July 15, 2003 10:53 AM > Subject: RE: [CANSLIM] Market Trend Charts > > > Gene, > > Do you have any opinions to offer regarding this > information? === message truncated === __________________________________ Do you Yahoo!? SBC Yahoo! DSL - Now only $29.95 per month! http://sbc.yahoo.com - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. ------------------------------ Date: Wed, 16 Jul 2003 15:40:07 -0400 From: France Subject: Re: RE: [CANSLIM] Market Wizards This is a multi-part message in MIME format. - ------=____1058384407015_9oVaI-9SIe Content-Type: text/plain; charset=iso-8859-1 Content-Transfer-Encoding: 7bit Kelly, Regarding the Market Wizards books, I have read all 3 and I consider them my bibles. They are very informative in terms of experience and most importantly from a trader's perspective, not some salesman's (read: broker) or analyst's. I highly recommend them to everybody. The traders' background differ (stocks, commodities, currencies), but they all exhibit similar winning characteristics. That being said, once you're out there doing your thing, the challenge is to adapt what you've learned to your situation, namely, most of us do not trade millions! Cheers, France From: "Kelly Short" Date: 2003/07/16 Wed PM 12:09:17 EST To: Subject: RE: [CANSLIM] Market Trend Charts David, What is the "Market Wizards" you refer to? Is this a book and if so, could you send me a link with more information on it. Has anyone else in the group read this book that could offer opinions on its value? Kelly - -----Original Message----- From: Dave Stem [mailto:canslimdave2003@yahoo.com] Sent: Wednesday, July 16, 2003 2:18 AM To: canslim@lists.xmission.com Subject: RE: [CANSLIM] Market Trend Charts Pritish... A good idea is to focus almost solely on risk and let the profits take care of themselves... which is what the 2% or less risk rule allows you to do. In his book, WON talks about how if you are alert, you will actually be out of many stocks before the 7-8% loss because you will be able to tell when a stock is not acting right. The 7-8% loss is the maximum. It's not a blind rule to follow. David Ryan, in Market Wizards, said he would sell half of any position that fell back to the pivot point. I highly recommend the interview with him. He talks very specifically about how to trade using CANSLIM. And he won some sort of investing championship 3 years in a row... which is not bad. Returns well over 100 percent each year. Personally, I think if you just buy breakouts and blindly use a 7-8% stop over the next few years, there is a good chance your portfolio will be eaten away... particularly if you are so naive as I was last year... to buy many stocks simultaneously without waiting for profits to show up first. Dave Pritish Shah wrote: I am still learning and the idea of "8% loss in a stock should not be greater than 2% of total portfolio" is a great. So at minimum, I should not invest more than 1/12th of my total portfolio in any individual stock. _____ Do you Yahoo!? SBC Yahoo! DSL - Now only $29.95 per month! - ------=____1058384407015_9oVaI-9SIe Content-Type: text/html; name="replyAll" Content-Disposition: inline; filename="replyAll"
David,
 
What is the "Market Wizards" you refer to? Is this a book and if so, could you send me a link with more information on it. Has anyone else in the group read this book that could offer opinions on its value?
 
Kelly
-----Original Message-----
From: Dave Stem [mailto:canslimdave2003@yahoo.com]
Sent: Wednesday, July 16, 2003 2:18 AM
To: canslim@lists.xmission.com
Subject: RE: [CANSLIM] Market Trend Charts

Pritish...
 
A good idea is to focus almost solely on risk and let the profits take care of themselves... which is what the 2% or less risk rule allows  you to do.  In his book, WON talks about how if you are alert, you will actually be out of many stocks before the 7-8% loss because you will be able to tell when a stock is not acting right.  The 7-8% loss is the maximum.  It's not a blind rule to follow. 
 
David Ryan, in Market Wizards, said he would sell half of any position that fell back to the pivot point.  I highly recommend the interview with him.  He talks very specifically about how to trade using CANSLIM.  And he won some sort of investing championship 3 years in a row... which is not bad.  Returns well over 100 percent each year.
 
Personally, I think if you just buy breakouts and blindly use a 7-8% stop over the next few years, there is a good chance your portfolio will be eaten away... particularly if you are so naive as I was last year... to buy many stocks simultaneously without waiting for profits to show up first.
 
Dave


Pritish Shah <pshah@lason.com> wrote:

I am still learning and the idea of "8% loss in a stock should not be greater than 2% of total portfolio" is a great. So at minimum, I should not invest more than 1/12th of my total portfolio in any individual stock.

Do you Yahoo!?
SBC Yahoo! DSL - Now only $29.95 per month!
- ------=____1058384407015_9oVaI-9SIe-- - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. ------------------------------ Date: Wed, 16 Jul 2003 14:02:16 -0600 From: "David Taggart" Subject: RE: RE: [CANSLIM] Market Wizards This is a multi-part message in MIME format. - ------=_NextPart_000_027C_01C34BA2.DD7C6C90 Content-Type: text/plain; charset="iso-8859-1" Content-Transfer-Encoding: 7bit All three Market Wizard books are excellent I dont know of a good trader that doesnt reccomend them. You can get all 3 in paperback for like 15 a book. -----Original Message----- From: owner-canslim@lists.xmission.com [mailto:owner-canslim@lists.xmission.com]On Behalf Of France Sent: Wednesday, July 16, 2003 1:40 PM To: canslim@lists.xmission.com; canslim@lists.xmission.com Subject: Re: RE: [CANSLIM] Market Wizards David, What is the "Market Wizards" you refer to? Is this a book and if so, could you send me a link with more information on it. Has anyone else in the group read this book that could offer opinions on its value? Kelly -----Original Message----- From: Dave Stem [mailto:canslimdave2003@yahoo.com] Sent: Wednesday, July 16, 2003 2:18 AM To: canslim@lists.xmission.com Subject: RE: [CANSLIM] Market Trend Charts Pritish... A good idea is to focus almost solely on risk and let the profits take care of themselves... which is what the 2% or less risk rule allows you to do. In his book, WON talks about how if you are alert, you will actually be out of many stocks before the 7-8% loss because you will be able to tell when a stock is not acting right. The 7-8% loss is the maximum. It's not a blind rule to follow. David Ryan, in Market Wizards, said he would sell half of any position that fell back to the pivot point. I highly recommend the interview with him. He talks very specifically about how to trade using CANSLIM. And he won some sort of investing championship 3 years in a row... which is not bad. Returns well over 100 percent each year. Personally, I think if you just buy breakouts and blindly use a 7-8% stop over the next few years, there is a good chance your portfolio will be eaten away... particularly if you are so naive as I was last year... to buy many stocks simultaneously without waiting for profits to show up first. Dave Pritish Shah wrote: I am still learning and the idea of "8% loss in a stock should not be greater than 2% of total portfolio" is a great. So at minimum, I should not invest more than 1/12th of my total portfolio in any individual stock. - ---------------------------------------------------------------------------- Do you Yahoo!? SBC Yahoo! DSL - Now only $29.95 per month! - ------=_NextPart_000_027C_01C34BA2.DD7C6C90 Content-Type: text/html; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable
All=20 three Market Wizard books are excellent I dont know of a good trader = that doesnt=20 reccomend them.  You can get all 3 in paperback for like 15 a = book. =20
-----Original Message-----
From:=20 owner-canslim@lists.xmission.com=20 [mailto:owner-canslim@lists.xmission.com]On Behalf Of=20 France
Sent: Wednesday, July 16, 2003 1:40 = PM
To:=20 canslim@lists.xmission.com; = canslim@lists.xmission.com
Subject: Re:=20 RE: [CANSLIM] Market Wizards

David,
 
What=20 is the "Market Wizards" you refer to? Is this a book and if so, could = you send=20 me a link with more information on it. Has anyone else in the group = read this=20 book that could offer opinions on its value?
 
Kelly
-----Original Message-----
From: Dave Stem=20 [mailto:canslimdave2003@yahoo.com]
Sent: Wednesday, July = 16, 2003=20 2:18 AM
To: canslim@lists.xmission.com
Subject: = RE:=20 [CANSLIM] Market Trend Charts

Pritish...
 
A good idea is to focus almost solely on risk and let the = profits take=20 care of themselves... which is what the 2% or less risk rule = allows =20 you to do.  In his book, WON talks about how if you are alert, = you will=20 actually be out of many stocks before the 7-8% loss because you will = be able=20 to tell when a stock is not acting right.  The 7-8% loss is the = maximum.  It's not a blind rule to follow. 
 
David Ryan, in Market Wizards, said he would sell half of any = position=20 that fell back to the pivot point.  I highly recommend the = interview=20 with him.  He talks very specifically about how to trade using=20 CANSLIM.  And he won some sort of investing championship 3 = years in a=20 row... which is not bad.  Returns well over 100 percent each=20 year.
 
Personally, I think if you just buy breakouts and blindly use a = 7-8%=20 stop over the next few years, there is a good chance your portfolio = will be=20 eaten away... particularly if you are so naive as I was last year... = to buy=20 many stocks simultaneously without waiting for profits to show up=20 first.
 
Dave


Pritish Shah <pshah@lason.com> = wrote:=20
I=20 am still learning and the idea of "8% loss in a stock should not = be=20 greater than 2% of total portfolio" is a great. So at minimum, I = should=20 not invest more than 1/12th of my total portfolio in any = individual=20 stock.

Do you Yahoo!?
SBC=20 Yahoo! DSL - Now only $29.95 per=20 month!
- ------=_NextPart_000_027C_01C34BA2.DD7C6C90-- - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. ------------------------------ Date: Wed, 16 Jul 2003 15:39:57 -0500 From: "Gene Ricci" Subject: Re: [CANSLIM] Market Trend Charts This is a multi-part message in MIME format. - ------=_NextPart_000_04E4_01C34BB0.82DF37A0 Content-Type: text/plain; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable Tomas, the 2% is RISK, not the amount of the stock purchase. He's going to use 1/12 of his portfolio for each purchase. If I get time later this evening I'll send you an example. Let me add that CS is good for selecting stocks to buy . <- period=20 Not known, in any of the circles that I frequent, for money management. Gene ----- Original Message -----=20 From: Tomas=20 To: canslim@lists.xmission.com=20 Sent: Wednesday, July 16, 2003 12:56 PM Subject: RE: [CANSLIM] Market Trend Charts One comment on the 2% comment. The whole idea using CS is to win big when you are right, as stated by WON. So, with only an investment of 2%, how do you win BIG even if the one stock went up 100%? Of course, you can pyramid up. But if you do that then that stock/investment will be more then 2% of your portfolio. I understand that capital preservation is very important, but I 2% is a bit much or too little. You have to put a lot of eggs in one basket to win big, right? That 2% rule sounds like diworsification. just my $.02 tomas --- Pritish Shah wrote: > Dave,=20 >=20 > You asked a good question on how to make money in > the range bound market. There in lies the answer > that I hope to use. If the stock market goes to the > bottom of the range, buy. If it goes to the top, > lock in your profits with a trailing stop so if a > stock goes higher, we would still be in. >=20 > I am hoping to purchase breakouts in the top 40 or > 50 industries only and want to do legwork before > hand so I only have to make a "yes" or a "no" > decision when an alert occurs. >=20 > I am still learning and the idea of "8% loss in a > stock should not be greater than 2% of total > portfolio" is a great. So at minimum, I should not > invest more than 1/12th of my total portfolio in any > individual stock. >=20 > Pritish >=20 >=20 > >>> canslimdave2003@yahoo.com 07/15/03 23:11 PM >>> > Pritish --=20 > =20 > I agree with you exactly. IMHO it will take 14 > years before the markets really break to a new high. > Well, 11 counting the three we've just been > through. In the 1968-82 period, the 1000 point > barrier was called "The Graveyard in the Sky" > because of all the rallies that failed at that > point. =20 > =20 > I'm very interested in learning how to apply CANSLIM > in such a range bound market. But I also want to > trade with the idea in mind that I may well be wrong > about my ideas on what the market will do.=20 > Therefore, I'm looking for buy/sell rules that work > despite my opinions. For example, SELL if a stock > breaks its 50 day moving average. =20 > =20 > On thing I have come up with is the idea of getting > into the market one profitable trade at a time.=20 > Last year, I became convinced that a bull market was > beginning and bought 6 different stocks on > breakouts, convinced that surely 1-2 would remain > above their 7-8% stop loss and therefore bail me > out. Instead, the market turned sharply against me > and I was quickly down 8+ % (because I bought some > on margin). =20 > =20 > This year, when the market started looking good to > me, I only put on one trade. Once that proved > profitable, I raised my stop loss level to break > even and put on a second trade. So, I've scaled my > way into the market. I am hoping that approach will > keep me from taking too big a hit if I am wrong > about market direction in the future. =20 > =20 > Also, I am being vigilant about limiting my > purchases so that if my 7% stop is hit, the loss is > less than 1.5% of my total portfolio. Over and over > in the Market Wizards books professional traders > talk about keeping the risk on any individual trade > to less than 2%. I don't think WON stresses this > rule enough. > =20 > Thanks for your post! > =20 > Dave >=20 > Pritish Shah wrote: > Hi Kelly,=20 >=20 > I have been studying where I am making mistakes. A > lot of my failures were bought when Nasdaq was > touching the upper bollinger bands. Checkout the > following chart. You will notice that Nasdaq is > currently toying with the upper bollinger bands and > has been bouncing from the 20dma. So the best time > to buy would be when Nasdaq again touches 20dma and > there are a flurry of breakouts.=20 >=20 > = http://finance.yahoo.com/q?s=3D^IXIC&d=3Dc&k=3Dc3&a=3Dvm,m26-12-9,ss,fs&p= =3Dm20,b&t=3D6m&l=3Don&z=3Dl&q=3Db >=20 >=20 > A lot of people have shown me charts that basically > predict that the market will churn for the next few > years and I believe that would be the trend. This is > where CANSLIM can do much better than any other > method of investing.=20 >=20 > Take a look at the following chart. You will notice > that from 1937 to 1950 (13 yrs), the market was > pretty much flat. From 1965 to 1983 also the market > was flat. There was also a flat period before 1930 > but that is not shown on the graph.=20 >=20 > = http://finance.yahoo.com/q?s=3D^DJI&d=3Dc&k=3Dc3&p=3D&t=3Dmy&l=3Don&z=3Dl= &q=3Dl >=20 >=20 > Basically after every major rise, the market pauses > for several years and then tries again. This has > happened 3 times on DJI. Nasdaq is currently > behaving exactly like DJI from 1930 to 1933. If it > continues to behave like DJI, for next year and > half, we are not going to go anywhere and then there > will be a major move upwards. > =20 > I am open for discussions but not flames please. > =20 > Thanks, > Pritish >=20 >=20 > >>> kelly.short@fw.us.neoris.com 07/15/03 02:40PM > >>>=20 > Gene,=20 >=20 > What was in your patriotic Wheeties this morning?! > Thanks for the explanation though. Have you thought > about a career in politics because that answer was > perfectly on the middle ground.=20 >=20 > Okay, okay. I'll ride the trend. I'm just bitter: > three of my recent BO purchases have gotten SARS and > are in quarantine. I fear I may lose them to the > "disease", or the hurricane, or whatever ailment is > keeping them from soaring.=20 >=20 > That said- I did enjoy reading the information you > passed along- thanks!=20 >=20 > Kelly=20 >=20 > -----Original Message-----=20 > From: Gene Ricci [ mailto:genr@swbell.net]=20 > Sent: Tuesday, July 15, 2003 1:06 PM=20 > To: canslim@lists.xmission.com=20 > Subject: Re: [CANSLIM] Market Trend Charts=20 >=20 >=20 > Kelly, forgive the clich=E9......... "The trend is > your friend".=20 >=20 > Now here's another profound statement "the trend is > up until proven otherwise".=20 >=20 > Many indicators are showing overbought, but they can > stay overbought for a long long time. Take last > year, they stayed oversold for a long long time. > Most likely there is a bit of consolidation going on > .... but who knows which way the break will occur. > One just has to decide at what point the trend has > changed from up to down (or sideways). And at what > point another breakout to the upside has occurred. > Each person must decide this on his/her own.=20 >=20 > We were told that there would not be a post war > rally - is that true?=20 > We were told the new dividend law would not affect > stock prices - is that true?=20 >=20 > Although I don't see signs of a renewed bear.... I > hear them in the background.... moaning and groaning > as they try to save face after losing their > butts.... shorting this year.=20 >=20 > I feel that the market has to continue its upward > trend because the public wants it to (to say nothing > about the administration). When I attend meetings, > read user group email and talk to friends I'm > reminded of the Statue of Liberty....=20 >=20 > "give me your tired, your poor, your huddled masses > yearning to breathe free"=20 >=20 > translated to:=20 >=20 > We're tired (poor management, manipulation, lies, > cooked books), we're poor, your investors are > yearning to once again believe!!!! ... kind of corny > but what the heck!=20 >=20 > Gene=20 >=20 >=20 >=20 >=20 > ----- Original Message -----=20 > From: Kelly Short < > mailto:kelly.short@fw.us.neoris.com >=20 > To: canslim@lists.xmission.com=20 > Sent: Tuesday, July 15, 2003 10:53 AM=20 > Subject: RE: [CANSLIM] Market Trend Charts=20 >=20 >=20 > Gene,=20 >=20 > Do you have any opinions to offer regarding this > information?=20 =3D=3D=3D message truncated =3D=3D=3D __________________________________ Do you Yahoo!? SBC Yahoo! DSL - Now only $29.95 per month! http://sbc.yahoo.com - -To subscribe/unsubscribe, email "majordomo@xmission.com" -In the email body, write "subscribe canslim" or -"unsubscribe canslim". Do not use quotes in your email. - ------=_NextPart_000_04E4_01C34BB0.82DF37A0 Content-Type: text/html; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable
Tomas, the 2% is RISK, not the amount = of the=20 stock purchase.
He's going to use 1/12 of his = portfolio for=20 each purchase. If I
get time later this evening I'll send = you an=20 example.
Let me add that CS is good for = selecting=20 stocks to buy .=20 <- period 
Not known, in any of the circles that = I=20 frequent, for money management.
Gene
----- Original Message -----
From:=20 Tomas
Sent: Wednesday, July 16, 2003 = 12:56=20 PM
Subject: RE: [CANSLIM] Market = Trend=20 Charts

One comment on the 2% comment.  The whole idea = using
CS=20 is to win big when you are right, as stated by WON.
 So, with = only an=20 investment of 2%, how do you win BIG
even if the one stock went up=20 100%?  Of course, you
can pyramid up.  But if you do that = then=20 that
stock/investment will be more then 2% of = your
portfolio.  I=20 understand that capital preservation is
very important, but I 2% is = a bit=20 much or too little.

You have to put a lot of eggs in one basket = to=20 win
big, right?  That 2% rule sounds like = diworsification.

just=20 my $.02
tomas

--- Pritish Shah <pshah@lason.com> wrote:
> = Dave,=20
>
> You asked a good question on how to make money = in
>=20 the range bound market. There in lies the answer
> that I hope = to use.=20 If the stock market goes to the
> bottom of the range, buy. If = it goes=20 to the top,
> lock in your profits with a trailing stop so if = a
>=20 stock goes higher, we would still be in.
>
> I am hoping = to=20 purchase breakouts in the top 40 or
> 50 industries only and = want to do=20 legwork before
> hand so I only have to make a "yes" or a = "no"
>=20 decision when an alert occurs.
>
> I am still learning = and the=20 idea of "8% loss in a
> stock should not be greater than 2% of=20 total
> portfolio" is a great. So at minimum, I should = not
>=20 invest more than 1/12th of my total portfolio in any
> = individual=20 stock.
>
> Pritish
>
>
> >>> = canslimdave2003@yahoo.com = 07/15/03=20 23:11 PM >>>
> Pritish --
> 
> I = agree with=20 you exactly.  IMHO it will take 14
> years before the = markets=20 really break to a new high.
>  Well, 11 counting the three = we've=20 just been
> through.  In the 1968-82 period, the 1000 = point
>=20 barrier was called "The Graveyard in the Sky"
> because of all = the=20 rallies that failed at that
> point. 
>  =
> I'm=20 very interested in learning how to apply CANSLIM
> in such a = range bound=20 market.  But I also want to
> trade with the idea in mind = that I=20 may well be wrong
> about my ideas on what the market will do. =
>=20 Therefore, I'm looking for buy/sell rules that work
> despite my = opinions.  For example, SELL if a stock
> breaks its 50 day = moving=20 average. 
> 
> On thing I have come up with is = the=20 idea of getting
> into the market one profitable trade at a = time.=20
> Last year, I became convinced that a bull market was
>=20 beginning and bought 6 different stocks on
> breakouts, = convinced that=20 surely 1-2 would remain
> above their 7-8% stop loss and = therefore bail=20 me
> out.  Instead, the market turned sharply against = me
>=20 and I was quickly down 8+ % (because I bought some
> on = margin). =20
> 
> This year, when the market started looking = good=20 to
> me, I only put on one trade.  Once that proved
> = profitable, I raised my stop loss level to break
> even and put = on a=20 second trade.  So, I've scaled my
> way into the = market.  I am=20 hoping that approach will
> keep me from taking too big a hit if = I am=20 wrong
> about market direction in the future.  =
> =20
> Also, I am being vigilant about limiting my
> purchases = so that=20 if my 7% stop is hit, the loss is
> less than 1.5% of my total=20 portfolio.  Over and over
> in the Market Wizards books=20 professional traders
> talk about keeping the risk on any = individual=20 trade
> to less than 2%.  I don't think WON stresses = this
>=20 rule enough.
> 
> Thanks for your = post!
> =20
> Dave
>
> Pritish Shah <pshah@lason.com> wrote:
> = Hi Kelly,=20
>
> I have been studying where I am making mistakes. = A
>=20 lot of my failures were bought when Nasdaq was
> touching the = upper=20 bollinger bands. Checkout the
> following chart. You will notice = that=20 Nasdaq is
> currently toying with the upper bollinger bands = and
>=20 has been bouncing from the 20dma. So the best time
> to buy = would be=20 when Nasdaq again touches 20dma and
> there are a flurry of = breakouts.=20
>
>
http://finance.yahoo.com/q?s=3D^IXIC&d=3Dc&k=3Dc3&a=3Dvm,m2= 6-12-9,ss,fs&p=3Dm20,b&t=3D6m&l=3Don&z=3Dl&q=3Db<= BR>>=20
>
> A lot of people have shown me charts that = basically
>=20 predict that the market will churn for the next few
> years and = I=20 believe that would be the trend. This is
> where CANSLIM can do = much=20 better than any other
> method of investing.
>
> = Take a=20 look at the following chart. You will notice
> that from 1937 to = 1950=20 (13 yrs), the market was
> pretty much flat. From 1965 to 1983 = also the=20 market
> was flat. There was also a flat period before = 1930
> but=20 that is not shown on the graph.
>
>
http://finance.yahoo.com/q?s=3D= ^DJI&d=3Dc&k=3Dc3&p=3D&t=3Dmy&l=3Don&z=3Dl&q=3D= l
>=20
>
> Basically after every major rise, the market = pauses
>=20 for several years and then tries again. This has
> happened 3 = times on=20 DJI. Nasdaq is currently
> behaving exactly like DJI from 1930 = to 1933.=20 If it
> continues to behave like DJI, for next year and
> = half, we=20 are not going to go anywhere and then there
> will be a major = move=20 upwards.
> 
> I am open for discussions but not = flames=20 please.
> 
> Thanks,
> Pritish
> =
>=20
> >>> kelly.short@fw.us.neoris.com= =20 07/15/03 02:40PM
> >>>
> Gene,
>
> = What=20 was in your patriotic Wheeties this morning?!
> Thanks for the=20 explanation though. Have you thought
> about a career in = politics=20 because that answer was
> perfectly on the middle ground. =
>=20
> Okay, okay. I'll ride the trend. I'm just bitter:
> = three of my=20 recent BO purchases have gotten SARS and
> are in quarantine. I = fear I=20 may lose them to the
> "disease", or the hurricane, or whatever = ailment=20 is
> keeping them from soaring.
>
> That said- I = did enjoy=20 reading the information you
> passed along- thanks!
> =
>=20 Kelly
>
> -----Original Message-----
> From: Gene = Ricci [=20 mailto:genr@swbell.net] =
> Sent:=20 Tuesday, July 15, 2003 1:06 PM
> To: canslim@lists.xmission.com= =20
> Subject: Re: [CANSLIM] Market Trend Charts
>
> =
>=20 Kelly, forgive the clich=E9......... "The trend is
> your = friend".=20
>
> Now here's another profound statement "the trend = is
>=20 up until proven otherwise".
>
> Many indicators are = showing=20 overbought, but they can
> stay overbought for a long long time. = Take=20 last
> year, they stayed oversold for a long long time.
> = Most=20 likely there is a bit of consolidation going on
> .... but who = knows=20 which way the break will occur.
> One just has to decide at what = point=20 the trend has
> changed from up to down (or sideways). And at=20 what
> point another breakout to the upside has = occurred.
> Each=20 person must decide this on his/her own.
>
> We were told = that=20 there would not be a post war
> rally - is that true?
> = We were=20 told the new dividend law would not affect
> stock prices - is = that=20 true?
>
> Although I don't see signs of a renewed = bear....=20 I
> hear them in the background.... moaning and groaning
> = as they=20 try to save face after losing their
> butts.... shorting this = year.=20
>
> I feel that the market has to continue its = upward
>=20 trend because the public wants it to (to say nothing
> about the = administration). When I attend meetings,
> read user group email = and=20 talk to friends I'm
> reminded of the Statue of Liberty.... =
>=20
> "give me your tired, your poor, your huddled masses
> = yearning=20 to breathe free"
>
> translated to:
>
> = We're=20 tired (poor management, manipulation, lies,
> cooked books), = we're poor,=20 your investors are
> yearning to once again believe!!!! ... kind = of=20 corny
> but what the heck!
>
> Gene
> =
>=20
>
>
> ----- Original Message -----
> From: = Kelly=20 Short <
> mailto:kelly.short@fw.us.neo= ris.com=20 >
> To: canslim@lists.xmission.com= =20
> Sent: Tuesday, July 15, 2003 10:53 AM
> Subject: RE: = [CANSLIM]=20 Market Trend Charts
>
>
> Gene,
>
> = Do you=20 have any opinions to offer regarding this
> information? =
=3D=3D=3D message=20 truncated = =3D=3D=3D


__________________________________
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