From: owner-canslim-digest@lists.xmission.com (canslim-digest) To: canslim-digest@lists.xmission.com Subject: canslim-digest V2 #889 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 Tuesday, May 2 2000 Volume 02 : Number 889 In this issue: [CANSLIM] Re: More W.O.N. comments on follow through day Re: [CANSLIM] Leaders List [CANSLIM] Changing your canslim subscription Re: [CANSLIM] The 8% Stop Re: [CANSLIM] The 8% Stop [CANSLIM] Re: Index charts w/ volume [CANSLIM] Walter Re: [CANSLIM] Marder Re: [CANSLIM] The 8% Stop Re: [CANSLIM] Leaders List Re: [CANSLIM] The 8% Stop [CANSLIM] Leaders List Re: [CANSLIM] The 8% Stop Re: [CANSLIM] Leaders List [CANSLIM] how to participate in stock markets of USA ---------------------------------------------------------------------- Date: Mon, 1 May 2000 01:11:16 EDT From: GOOWLS@aol.com Subject: [CANSLIM] Re: More W.O.N. comments on follow through day From notes I made at a free seminar in Houston, TX on August 23, 1997, presented by Wiiliam O'Neil: "Buy the leaders on the follow through day. You will be afraid, but you must buy stocks on the follow through day." Mike Goode - - ------------------------------ Date: Mon, 1 May 2000 13:45:50 -0700 From: "Tom Gumpel, PhD" Subject: Re: [CANSLIM] Leaders List Earl, I'm new to this list, and new to CANSLIM in general, but that's a great list. I assume that you use a spreadsheet to create the list; I'd be interested in seeing it, if it's in the public domain. I counted 33 stocks with good bases that were either developing or were well developed. Great time saver! Tom - ----- Original Message ----- From: "Earl Setser" To: Sent: Sunday, April 30, 2000 7:08 AM Subject: [CANSLIM] Leaders List > Here is my latest "Leaders List". This list is assembled by taking stocks > in the top 40 Industry Groups and generating a score for the stocks by > combining IBD EPS, RPS, SPR rating, A/D rating, and Sponsorship rank. > (Note that I have skipped the two or three Industry Groups in the Top 40 > that are negative for the year.) I try to remove any stocks that are being > purchased from the list. The list is the top 100 (or so) stocks by score > (in order, highest scores first). I monitor this list for technical > signals to buy. This list represents strong stocks that you may want to > watch, but they have not been reviewed for technical signals yet, so PLEASE > do your own DD before you buy. > > Personally, I've "tip-toed" back into the market a little the last few > days. I am 33% invested at this point. Disclaimer: I own BBRC and MTSN > (which just missed the list this week). > > QGENF > TLGD > TQNT > PWAV > QLGC > SDLI > DSPG > ADCT > PCCC > TLCM > AMCC > CREE > ALTR > TECH > PMCS > PLMD > FLEX > LTRE > TKLC > BBRC > TNL > SMTC > NT > RMD > IMPH > NTAP > PWER > SNDK > CDWC > KING > DY > SCI > PSEM > XLTC > CHP > ELNT > ERICY > PLXT > AMK > KEI > ANEN > DRAM > QCOM > ADTN > MCHP > NEWP > APH > VOXX > ADIC > VTSS > MCRL > DFXI > CMVT > RFMD > JBL > WAT > MXIM > SILI > NVLS > DGX > SUNW > HH > XLNX > VSH > ZOLL > HC > ASMI > SFA > AMKR > NOK > ELN > SLR > CTS > ADI > TER > SAWS > SBL > ORBK > AUDC > AFCI > ACTL > VRI > ESIO > OCCF > MIL > ZOMX > DIO > GLW > DITC > SSTI > MOLX > DS > PROX > CGNX > XETA > AMAT > MEAD > STM > EDMC > CTV > SANM > > > > - > - - ------------------------------ Date: Mon, 1 May 2000 08:00:00 -0600 From: owner-canslim@xmission.com (Jeff Salisbury) Subject: [CANSLIM] Changing your canslim subscription This is a twice monthly posting to the CANLSLIM group. Frequently, people sign up for the canslim list and then are overwhelmed by the volume of the email. There are three remedies for this problem: 1) You can leave our group. 2) you can switch to the digest version which "conglomerates" many canslim messages into one large message. Or, 3) You can setup customized filters on your own mail client to sort the incoming canslim messages to its own folder. If you wish to modify your canslim subscription, email a message to: majordomo@xmission.com The remove yourself from the canslim list, write in the body of the email: unsubscribe canslim To add yourself to the digest version of the canslim list, write in the body of the email: subscribe canslim-digest For general help with majordomo commands, write in the body of the email: help If you need further clarification, write me directly at: canslim-owner@lists.xmission.com Best Regards, Jeff Salisbury - CANSLIM list admin / owner - - ------------------------------ Date: Mon, 1 May 2000 10:56:56 -0700 (PDT) From: Pritish Shah Subject: Re: [CANSLIM] The 8% Stop Also the key thing that most people forgot to mention as to why 8% and why not anything else or why 10% and why not anything else. The reason is pretty simple. With a 10% loss, you need a 11% gain to make up for the loss With a 20% loss, you need 25% gain to make up With a 30% loss, you need 50% gain to make up With 40% loss, you need 66% gain to make up you get the picture? So the reason for the 7 to 8% loss is that you need 7 to 8% gain to offset the loss. Regards, Pritish On Sat, 29 Apr 2000, Earl Setser wrote: > Ah, history you seek (as Yoda would say). Here is the story from HTMMIS: > > Limit Your Losses to 7% or 8% of Your Cost (paragraph I took this from) > > ... > "When the late Gerald M. Loeb of E.F. Hutton was writing his last book on > the stock market, I had the pleasure of dicussig this issuei with him im my > office. In his first work, "The Battle for Investment Survival", Loeb > advocated cutting all losses at 10%. I was curious and asked him if he > followed the 10% loss policy himself. He said "I would hope to be out long > before they ever reach 10%." > > ... > > "To preserve your hard-earned money, I think 7% or 8% should be the limit. > Your overall average of all losses should be less, prehaps 5% or 6%, if you > are strict anf fast on your feet." > > So this is where the rule came from for us CANSLIM investors. > > > > At 01:56 PM 4/29/00 -0500, you wrote: > > > >----- Original Message ----- > >From: "Earl Setser" > >To: > >Sent: Saturday, April 29, 2000 1:07 PM > >Subject: Re: [CANSLIM] The 8% Stop > > > > > >> At 12:50 PM 4/29/00 -0500, you wrote: > >> >Hi guys, > >> >I was wondering where the almost-universal use of the 8% stop originated. > >> >What is the theory/basis for this number? > >(SNIP) > > > >> WON says that rule number 1 is to limit your losses. He suggests 7-8% as > >> the maximum loss. > > > >Hi Earl, > >Thanks for your reply. I understand WON's recommendation, but I was > >wondering about its derivation. Nearly everyone uses it including mutual > >fund folks, but I've never heard of the originator or how this *particular* > >number was arrived at. Thanks again. > >Best wishes, > >Walt > > > >(Snip) > > > >> >The reason that I'm asking is that "buying the (10%) dip" is popular > >among > >> >certain market timers, and it seems to occur often enough that they have > >> >incorporated it into their systems. > >> > >> Well, remember, the 7-8% is only based on your initial purchase. It does > >> not apply to a trailing stop based on the stocks intraday or closing high. > >> I believe 8% would be too tight for use in such approaches. > > > >> >Could there be a correlation between the sellers at about -8%, and the > >> >(usual) buyers at about -10%? > >> >While very strong stocks may withstand a general market decline, > >otherwise > >> >"good" stocks may not fare so well. Can the 8% stop be justified in light > >of > >> >the usual turn around just past 10%? > >> > >> I'm not sure there is any magic number, 8%, 10%, 15%?? I've seen daily > >> volatility WAY over any of these during the last month. Personally, I try > >> to use the closing price as my trigger point, and I don't set hard stops > >or > >> react to intraday prices (for the most part). I do try to give my stocks > >a > >> chance to recover from a late day dip if they are still close to the -08% > >> point. This approach has kept me in some good stocks, and has increased > >my > >> losses on some bad one. I'm not sure it's worked that well overall, but I > >> haven't found anything I prefer as yet. > > > > > > > > > > > > > >- > > > > > > > > > - > > - - ------------------------------ Date: Mon, 1 May 2000 15:40:17 -0400 From: "Matt Robinson" Subject: Re: [CANSLIM] The 8% Stop Well, I don't really see why someone would try to make the percentage of loss tolerance equal to the percentage of gain need to cover such losses. Further, this is mathematically impossible. The percentage needed to cover a specific loss is = Percentage lost / (1 - Percentage lost). From that standpoint, I don't see much difference from a stop at 10% and one at 8%. Obviously, the level of tolerance is chosen in a tradeoff between level of risk tolerable and allowance for fluctuations and volatility. I wonder whether stop-loss rules of ~8% even have validity in these markets, or to what degree they have validity. When these ideas were formulated or when O'Neill employed such ideas, markets were less volatile. What does one do now? Because of changes in volatility parameters, much one assume more risk in order to "give stocks a chance?" Further, I wonder about the use of closing day price stops, or "soft" stops. These, I would think, fail to make use of one of the principles at the core hard stop-losses. That is: absolutely limiting losses to a specific amount. On a contrary point, I often see people falsely touting hard stop-losses as a "crash exposure prevention technique." However, often times in extreme market turns, little liquidity can be found in the other direction. That is, if there is a crash, of historical proportions like many call for, it is doubtful there will be a significant number of bids allowing people to exit with a 7-8% loss. Anyway, what I wonder is: would evaluating stocks at the end of the day (if this can be done unemotionally, which is hard to do) be as good as employing a "soft" stop-loss? If someone were to perhaps specify other parameters (that are preferably quantifiable), would this be sufficient protection. For example, I am sure that many who use "soft" stop-losses also require that volume parameters also be met. Don't misunderstand me though. While I am wondering about the validity of stop-losses, I do not suggest NOT using them. I think key to anyone's investment approach is some sort of risk mitigation and the peace of mind that it will allow. What is the best way to accomplish this? I would be curious as to what other people do to limit losses/risk. Regards Matt - ----- Original Message ----- From: Pritish Shah To: Sent: Monday, May 01, 2000 1:56 PM Subject: Re: [CANSLIM] The 8% Stop > > Also the key thing that most people forgot to mention as to why 8% and why > not anything else or why 10% and why not anything else. > > The reason is pretty simple. > > With a 10% loss, you need a 11% gain to make up for the loss > With a 20% loss, you need 25% gain to make up > With a 30% loss, you need 50% gain to make up > With 40% loss, you need 66% gain to make up > > you get the picture? > > So the reason for the 7 to 8% loss is that you need 7 to 8% gain to offset > the loss. > > Regards, > Pritish > > On Sat, 29 Apr 2000, Earl Setser wrote: > > > Ah, history you seek (as Yoda would say). Here is the story from HTMMIS: > > > > Limit Your Losses to 7% or 8% of Your Cost (paragraph I took this from) > > > > ... > > "When the late Gerald M. Loeb of E.F. Hutton was writing his last book on > > the stock market, I had the pleasure of dicussig this issuei with him im my > > office. In his first work, "The Battle for Investment Survival", Loeb > > advocated cutting all losses at 10%. I was curious and asked him if he > > followed the 10% loss policy himself. He said "I would hope to be out long > > before they ever reach 10%." > > > > ... > > > > "To preserve your hard-earned money, I think 7% or 8% should be the limit. > > Your overall average of all losses should be less, prehaps 5% or 6%, if you > > are strict anf fast on your feet." > > > > So this is where the rule came from for us CANSLIM investors. > > > > > > > > At 01:56 PM 4/29/00 -0500, you wrote: > > > > > >----- Original Message ----- > > >From: "Earl Setser" > > >To: > > >Sent: Saturday, April 29, 2000 1:07 PM > > >Subject: Re: [CANSLIM] The 8% Stop > > > > > > > > >> At 12:50 PM 4/29/00 -0500, you wrote: > > >> >Hi guys, > > >> >I was wondering where the almost-universal use of the 8% stop originated. > > >> >What is the theory/basis for this number? > > >(SNIP) > > > > > >> WON says that rule number 1 is to limit your losses. He suggests 7-8% as > > >> the maximum loss. > > > > > >Hi Earl, > > >Thanks for your reply. I understand WON's recommendation, but I was > > >wondering about its derivation. Nearly everyone uses it including mutual > > >fund folks, but I've never heard of the originator or how this *particular* > > >number was arrived at. Thanks again. > > >Best wishes, > > >Walt > > > > > >(Snip) > > > > > >> >The reason that I'm asking is that "buying the (10%) dip" is popular > > >among > > >> >certain market timers, and it seems to occur often enough that they have > > >> >incorporated it into their systems. > > >> > > >> Well, remember, the 7-8% is only based on your initial purchase. It does > > >> not apply to a trailing stop based on the stocks intraday or closing high. > > >> I believe 8% would be too tight for use in such approaches. > > > > > >> >Could there be a correlation between the sellers at about -8%, and the > > >> >(usual) buyers at about -10%? > > >> >While very strong stocks may withstand a general market decline, > > >otherwise > > >> >"good" stocks may not fare so well. Can the 8% stop be justified in light > > >of > > >> >the usual turn around just past 10%? > > >> > > >> I'm not sure there is any magic number, 8%, 10%, 15%?? I've seen daily > > >> volatility WAY over any of these during the last month. Personally, I try > > >> to use the closing price as my trigger point, and I don't set hard stops > > >or > > >> react to intraday prices (for the most part). I do try to give my stocks > > >a > > >> chance to recover from a late day dip if they are still close to the -08% > > >> point. This approach has kept me in some good stocks, and has increased > > >my > > >> losses on some bad one. I'm not sure it's worked that well overall, but I > > >> haven't found anything I prefer as yet. > > > > > > > > > > > > > > > > > > > > >- > > > > > > > > > > > > > > > - > > > > > > > - > __________________________________________________ Do You Yahoo!? Talk to your friends online with Yahoo! Messenger. http://im.yahoo.com - - ------------------------------ Date: Mon, 01 May 2000 18:18:03 -0700 From: han.26@osu.edu Subject: [CANSLIM] Re: Index charts w/ volume >>>Earl Setser Subject: Re: [CANSLIM] WON on spotting a bottom CBS Marketwatch includes volume for indexes (at least the Nasdaq) in their historical quotes section. You can get there by going to the main page, selecting the index, then historical quotes, then input the date. For the Nasdaq, here is the link: http://www2.marketwatch.com/quotes/historical.asp?source=htx/http2_mw&symb=$ compq<<< Earl, Thank you much, - -Jim-- - - ------------------------------ Date: Mon, 01 May 2000 18:20:13 -0700 From: han.26@osu.edu Subject: [CANSLIM] Walter Walter Nusbaum, Thanks to you as well, - -Jim-- - - ------------------------------ Date: Mon, 1 May 2000 18:09:51 -0600 From: "Patrick Wahl" Subject: Re: [CANSLIM] Marder I also thought he seemed to be pretty canslimmy in the article, was talking about looking for stocks that are basing and then buying at new highs, and looking for the leading groups, pretty much what we talk about on this list every day. On 30 Apr 00, at 22:17, Earl Setser wrote: > Hmm, I'm not sure I understand your comment. The stocks he mentions are > ones I am watching (except KEM that I left off due to the 74 EPS is below > my 75 limit). They have good CANSLIM numbers, and he watching for new > highs after bases. I bought both BBRC and MTSN last week after breakouts > that he mentioned. What am I missing?? > > At 10:35 PM 4/30/00 -0400, you wrote: > >this seems more like momentum trading than CANSLIM investing. > > > >Tom Worley > >stkguru@netside.net > >chat with me at ICQ # 5568838 > >get ICQ software at http://www.icq.com/icqhomepage.html > > > > > >----- Original Message ----- > >From: Patrick Wahl > >To: > >Sent: Sunday, April 30, 2000 9:52 PM > >Subject: [CANSLIM] Marder > > > > > >Another freebie from Kevin Marder at cbs marketwatch - > > > >http://cbs.marketwatch.com/news/current/charthead.htx?source=ht > >x/http2_mw > > > >- > > > > > > > >- > > > > > > > > > - > - - ------------------------------ Date: Mon, 1 May 2000 18:12:42 -0600 From: "Patrick Wahl" Subject: Re: [CANSLIM] The 8% Stop On 1 May 00, at 10:56, Pritish Shah wrote: > > Also the key thing that most people forgot to mention as to why 8% and why > not anything else or why 10% and why not anything else. > > The reason is pretty simple. > > With a 10% loss, you need a 11% gain to make up for the loss > With a 20% loss, you need 25% gain to make up > With a 30% loss, you need 50% gain to make up > With 40% loss, you need 66% gain to make up > > you get the picture? > > So the reason for the 7 to 8% loss is that you need 7 to 8% gain to offset > the loss. I think the mathematics is only a secondary consideration. After all, if at 8% you were being repeatedly stopped out, it would still get pretty expensive. O'Neil says that if you are buying a strong stock at just the right point, it is usually not going to pull back more than a few percent, so if it goes farther than that, 8%, then you are probably wrong on your purchase. - - ------------------------------ Date: Mon, 01 May 2000 19:15:05 -0600 From: Earl Setser Subject: Re: [CANSLIM] Leaders List I'm glad you like the list. I try to post it about once per month to give people a shorter list to start with. I won't claim it's a perfect approach, but I have done better since I've concentrated on fewer candidates. I'm still playing around with my formula that combines the rankings, and how many Industry Groups to use, so it's always a work in progress. I hope to be able to accomplish the same task via DGO in the near future. At 01:45 PM 5/1/00 -0700, you wrote: >Earl, >I'm new to this list, and new to CANSLIM in general, but that's a great >list. >I assume that you use a spreadsheet to create the list; I'd be interested in >seeing it, if it's in the public domain. >I counted 33 stocks with good bases that were either developing or were well >developed. >Great time saver! >Tom >----- Original Message ----- >From: "Earl Setser" >To: >Sent: Sunday, April 30, 2000 7:08 AM >Subject: [CANSLIM] Leaders List > >> Here is my latest "Leaders List". This list is assembled by taking stocks >> in the top 40 Industry Groups and generating a score for the stocks by >> combining IBD EPS, RPS, SPR rating, A/D rating, and Sponsorship rank. >> (Note that I have skipped the two or three Industry Groups in the Top 40 >> that are negative for the year.) I try to remove any stocks that are >being >> purchased from the list. The list is the top 100 (or so) stocks by score >> (in order, highest scores first). I monitor this list for technical >> signals to buy. This list represents strong stocks that you may want to >> watch, but they have not been reviewed for technical signals yet, so >PLEASE >> do your own DD before you buy. >> >> Personally, I've "tip-toed" back into the market a little the last few >> days. I am 33% invested at this point. Disclaimer: I own BBRC and MTSN >> (which just missed the list this week). >> >> QGENF >> TLGD >> TQNT >> PWAV >> QLGC >> SDLI >> DSPG >> ADCT >> PCCC >> TLCM >> AMCC >> CREE >> ALTR >> TECH >> PMCS >> PLMD >> FLEX >> LTRE >> TKLC >> BBRC >> TNL >> SMTC >> NT >> RMD >> IMPH >> NTAP >> PWER >> SNDK >> CDWC >> KING >> DY >> SCI >> PSEM >> XLTC >> CHP >> ELNT >> ERICY >> PLXT >> AMK >> KEI >> ANEN >> DRAM >> QCOM >> ADTN >> MCHP >> NEWP >> APH >> VOXX >> ADIC >> VTSS >> MCRL >> DFXI >> CMVT >> RFMD >> JBL >> WAT >> MXIM >> SILI >> NVLS >> DGX >> SUNW >> HH >> XLNX >> VSH >> ZOLL >> HC >> ASMI >> SFA >> AMKR >> NOK >> ELN >> SLR >> CTS >> ADI >> TER >> SAWS >> SBL >> ORBK >> AUDC >> AFCI >> ACTL >> VRI >> ESIO >> OCCF >> MIL >> ZOMX >> DIO >> GLW >> DITC >> SSTI >> MOLX >> DS >> PROX >> CGNX >> XETA >> AMAT >> MEAD >> STM >> EDMC >> CTV >> SANM >> >> >> >> - >> > >- > > > - - ------------------------------ Date: 1 May 2000 18:39:59 -0700 From: "Tim Fisher" Subject: Re: [CANSLIM] The 8% Stop As JJ Cramer has said, stocks worth owning don't trade in one point increments any more. They did when WON set the rules. I doubled my stop loss on CANSLIM buys to 15%. At 03:40 PM 5/1/00 -0400, you wrote: >Well, I don't really see why someone would try to make the percentage of >loss tolerance equal to the percentage of gain need to cover such losses. >Further, this is mathematically impossible. The percentage needed to cover a >specific loss is = Percentage lost / (1 - Percentage lost). From that >standpoint, I don't see much difference from a stop at 10% and one at 8%. >Obviously, the level of tolerance is chosen in a tradeoff between level of >risk tolerable and allowance for fluctuations and volatility. > > I wonder whether stop-loss rules of ~8% even have validity in these >markets, or to what degree they have validity. When these ideas were >formulated or when O'Neill employed such ideas, markets were less volatile. >What does one do now? Because of changes in volatility parameters, much one >assume more risk in order to "give stocks a chance?" Further, I wonder about >the use of closing day price stops, or "soft" stops. These, I would think, >fail to make use of one of the principles at the core hard stop-losses. That >is: absolutely limiting losses to a specific amount. On a contrary point, I >often see people falsely touting hard stop-losses as a "crash exposure >prevention technique." However, often times in extreme market turns, little >liquidity can be found in the other direction. That is, if there is a crash, >of historical proportions like many call for, it is doubtful there will be a >significant number of bids allowing people to exit with a 7-8% loss. Anyway, >what I wonder is: would evaluating stocks at the end of the day (if this can >be done unemotionally, which is hard to do) be as good as employing a "soft" >stop-loss? If someone were to perhaps specify other parameters (that are >preferably quantifiable), would this be sufficient protection. For example, >I am sure that many who use "soft" stop-losses also require that volume >parameters also be met. > >Don't misunderstand me though. While I am wondering about the validity of >stop-losses, I do not suggest NOT using them. I think key to anyone's >investment approach is some sort of risk mitigation and the peace of mind >that it will allow. What is the best way to accomplish this? I would be >curious as to what other people do to limit losses/risk. > >Regards >Matt > > > >----- Original Message ----- >From: Pritish Shah >To: >Sent: Monday, May 01, 2000 1:56 PM >Subject: Re: [CANSLIM] The 8% Stop > > > > > > Also the key thing that most people forgot to mention as to why 8% and why > > not anything else or why 10% and why not anything else. > > > > The reason is pretty simple. > > > > With a 10% loss, you need a 11% gain to make up for the loss > > With a 20% loss, you need 25% gain to make up > > With a 30% loss, you need 50% gain to make up > > With 40% loss, you need 66% gain to make up > > > > you get the picture? > > > > So the reason for the 7 to 8% loss is that you need 7 to 8% gain to offset > > the loss. > > > > Regards, > > Pritish > > > > On Sat, 29 Apr 2000, Earl Setser wrote: > > > > > Ah, history you seek (as Yoda would say). Here is the story from >HTMMIS: > > > > > > Limit Your Losses to 7% or 8% of Your Cost (paragraph I took this from) > > > > > > ... > > > "When the late Gerald M. Loeb of E.F. Hutton was writing his last book >on > > > the stock market, I had the pleasure of dicussig this issuei with him im >my > > > office. In his first work, "The Battle for Investment Survival", Loeb > > > advocated cutting all losses at 10%. I was curious and asked him if he > > > followed the 10% loss policy himself. He said "I would hope to be out >long > > > before they ever reach 10%." > > > > > > ... > > > > > > "To preserve your hard-earned money, I think 7% or 8% should be the >limit. > > > Your overall average of all losses should be less, prehaps 5% or 6%, if >you > > > are strict anf fast on your feet." > > > > > > So this is where the rule came from for us CANSLIM investors. > > > > > > > > > > > > At 01:56 PM 4/29/00 -0500, you wrote: > > > > > > > >----- Original Message ----- > > > >From: "Earl Setser" > > > >To: > > > >Sent: Saturday, April 29, 2000 1:07 PM > > > >Subject: Re: [CANSLIM] The 8% Stop > > > > > > > > > > > >> At 12:50 PM 4/29/00 -0500, you wrote: > > > >> >Hi guys, > > > >> >I was wondering where the almost-universal use of the 8% stop >originated. > > > >> >What is the theory/basis for this number? > > > >(SNIP) > > > > > > > >> WON says that rule number 1 is to limit your losses. He suggests >7-8% as > > > >> the maximum loss. > > > > > > > >Hi Earl, > > > >Thanks for your reply. I understand WON's recommendation, but I was > > > >wondering about its derivation. Nearly everyone uses it including >mutual > > > >fund folks, but I've never heard of the originator or how this >*particular* > > > >number was arrived at. Thanks again. > > > >Best wishes, > > > >Walt > > > > > > > >(Snip) > > > > > > > >> >The reason that I'm asking is that "buying the (10%) dip" is popular > > > >among > > > >> >certain market timers, and it seems to occur often enough that they >have > > > >> >incorporated it into their systems. > > > >> > > > >> Well, remember, the 7-8% is only based on your initial purchase. It >does > > > >> not apply to a trailing stop based on the stocks intraday or closing >high. > > > >> I believe 8% would be too tight for use in such approaches. > > > > > > > >> >Could there be a correlation between the sellers at about -8%, and >the > > > >> >(usual) buyers at about -10%? > > > >> >While very strong stocks may withstand a general market decline, > > > >otherwise > > > >> >"good" stocks may not fare so well. Can the 8% stop be justified in >light > > > >of > > > >> >the usual turn around just past 10%? > > > >> > > > >> I'm not sure there is any magic number, 8%, 10%, 15%?? I've seen >daily > > > >> volatility WAY over any of these during the last month. Personally, >I try > > > >> to use the closing price as my trigger point, and I don't set hard >stops > > > >or > > > >> react to intraday prices (for the most part). I do try to give my >stocks > > > >a > > > >> chance to recover from a late day dip if they are still close to >the -08% > > > >> point. This approach has kept me in some good stocks, and has >increased > > > >my > > > >> losses on some bad one. I'm not sure it's worked that well overall, >but I > > > >> haven't found anything I prefer as yet. > > > > > > > > > > > > > > > > > > > > > > > > > > > >- > > > > > > > > > > > > > > > > > > > > > - > > > > > > > > > > > > - > > > > >__________________________________________________ >Do You Yahoo!?? >Talk to your friends online with Yahoo! Messenger.. >http://im.yahoo.comm Tim Fisher, 1995 President, Pacific Fishery Biologists Ore-ROCK-On Rockhounding Web Site PFB Information mailto:tim@OreRockOn.com WWW http://OreRockOn.com - - ------------------------------ Date: Mon, 01 May 2000 21:03:09 -0600 From: Earl Setser Subject: [CANSLIM] Leaders List To Tom Gumpel, I was going to send you a copy of my spreadsheet for your perusal, but my message to you bounced. If you will send me a private email, I'll be happy to send you a copy. Earl esetser@csolutions.net - - ------------------------------ Date: Mon, 1 May 2000 23:11:32 -0400 From: "Tom Worley" Subject: Re: [CANSLIM] The 8% Stop Hi Matt, One clarification - neither a stop loss nor a stop limit will absolutely guarantee limiting your loss to a specific amount in the event of a gap down. Tom Worley stkguru@netside.net chat with me at ICQ # 5568838 get ICQ software at http://www.icq.com/icqhomepage.html - ----- Original Message ----- From: Matt Robinson To: Sent: Monday, May 01, 2000 3:40 PM Subject: Re: [CANSLIM] The 8% Stop Further, I wonder about the use of closing day price stops, or "soft" stops. These, I would think, fail to make use of one of the principles at the core hard stop-losses. That is: absolutely limiting losses to a specific amount. - - ------------------------------ Date: Mon, 01 May 2000 20:25:19 -0700 From: Talib Hirji Subject: Re: [CANSLIM] Leaders List Earl, It would be appreciated, if you could forward a copy of your spreadsheet to the undersigned as well, if it is not much for asking. Thank You, Talib hirji@worldnet.att.net At 09:03 PM 5/1/00 -0600, you wrote: >To Tom Gumpel, > >I was going to send you a copy of my spreadsheet for your perusal, but my >message to you bounced. If you will send me a private email, I'll be happy >to send you a copy. > >Earl >esetser@csolutions.net > > >- - - ------------------------------ Date: Tue, 2 May 2000 00:08:23 -0700 (PDT) From: khalafalla mustafa Subject: [CANSLIM] how to participate in stock markets of USA I am a businessman from africa and I want to participate in share trading of US companies and I want help how can I find a reputable brokerage house to help me in entering stock market of US. You have to know that I WANT TO BEGIN FROM AS LITTLE AS 500 us dollars. thank you khalaf __________________________________________________ Do You Yahoo!? Send instant messages & get email alerts with Yahoo! Messenger. http://im.yahoo.com/ - - ------------------------------ End of canslim-digest V2 #889 ***************************** 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.