That being said, one stock I selected, EKO.v, has been a real stinker. That stock was too far away from its 50dma when selected, and I will keep that in mind when selecting stocks in the future.
This is the 14th week of the experiment, and here are the breakdown of the results thus far:
Here is this week's mega trending stock:
As you can see, the 50dma has formed an impenetrable wall that has acted as a bulwark against any bullish price action. Naturally, as per the rules of this strategy, we would place a stop above the 50dma.
In order to maximize profits trading and investing in stocks, I feel that we should take WD Gann's advice, and "be just as willing to sell short as you are to buy." In fact Jesse Livermore, certainly made more money shorting stocks than he ever did going long.
What I try to to do is to go with the flow. If the trend is down, then short, and if the trend is up, then buy. Here is what Mr. Livermore had to say about this principle:
"I was short one hundred and fifty thousand shares of
stock, not because I knew the news was coming, but because I was
going along the line of least resistance."
stock, not because I knew the news was coming, but because I was
going along the line of least resistance."
By trading with the trend, we are going along the line of least resistance. Thanks for visiting.
3 comments:
"Many fundamental analysts, especially the CFA type, the type that thinks they are smarter than everyone else, but could never outperform an index if their life depended on it, probably would die for 10% a year."
For the record, I actually am taking offense from that statement. Perhaps you had a bad experience with ONE CFA. I don't know. Before retiring, I was one. I met a lot of CFA's all over the world during my working life experience, and never felt your description of the fundamentalist CFA as accurate.
I doubt the business has changed that much since I left it 4 years ago.
It is true however that a majority of professionnal money managers have a lot of trouble out performing their benchmark over a 4 year cycle. Many are not necessaraly CFa's. Also, many can only manage LONG only portfolios because of clients constraints. So it becomes a traditional Asset Mix situation with Long Assets vs Cash.
Many CFA's that I know are not only fundamentalists. I for one have always combined fundamentals to find "longer term superior growth or value companies" with technical analysis to design an investment plan and time entries and exits over the intermediate to shorter term.
I believe your comment is an unfair generalisation which could affect the credibility of the writer of this blog
The Word
The Word
Hello,
I do apologize if I offended you with that statement. I was only trying to be facetious, and bring a bit of humour to a rather dull subject.
I will try to word my opinions more carefully in future.
I'm no philologist, The Word, but I see little wrong, either generally or semantically with what Danny said. Maybe I’m wrong, but I thought all CFAs did think they were smarter than everyone else. In fact, after looking up the “code of conduct” for CFAs on the Internet, I found two relevant things: 1) (From Section 8, subsection e) “you must, at all cost, believe, in truth, that you are, in fact, smarter than everyone else”, and 2) (From Section 12, subsection k) “in the event that anyone reveals this, publicly, deny it wholly and become offended.” Ok, so you were just following orders. That’s agreeable chap.
Ok, I made all that up. I was being….ahem…facetious.
I propose we reduce all this subjectivity to the rubbish it is. Politicians are awful. Don’t believe me? Let’s have a vote—I say “aye!” Only politicians (or recently retired ones) would take offense to that. But everyone knows they are. But we all know too, that they serve vital purpose. So do CFAs. They manage financially un-savvy people’s money. So if I, or Danny, or hell anyone (and most would) poke a rib here or there, go relax.
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