As I've posted before, I'm up a decent % since I started trading several months ago. I've found that it's getting difficult to match my earlier performance on an ongoin, continuous basis. I'm up 22% since late June, but have been sucking wind for the last couple of weeks. Does anyone use/subsribe to CANSLIM (either the letter or the online service)? Is it just another gimmick, or is there truly something to it?
Well... "Average Down" might alse be a contender in the Diet soft drink wars...hehe Well then there is that off brand..."Tops and Bottoms"... "Bollinger Bands" could find a new calling.... But stay away from the "Weighted Moving Average" and those "Fat Tails"...HeHe "Midpoint" could take on a new meaning...and you could even introduce energy snacks named "Volume Bars" "Convergence and Divergence" could be a lecture series....where fat traders attend...to learn how to take the loss... "Retracement" could be the name of the new Traders Gym on the corner...and Deviations could be the Bar next door...Now if you need a little "Price Action" there is always the "Far Right Edge" to visit in back of the mall, but you do not want to go in the hole too deep without a "hedge"...hehe it goes on and on.... hey... older men could take some Keltner to get a good candlestick going...could be a new "Trend" making them see green... Those European women with "Fibonacci Curves" are attracted to "Scalpers" that do "Big Size". If you massage the price they can get "big equity curves"..ohhh..those beautiful woman can get "overheated" in the "right zone"...sorry got carried away... on and on... Zero line trigger Waves Momentum.... my Dow is up... Taken a big loss with my Shorts... I have far too much time on my hands... Michael B.
I previousy subscribed to Investors Business Daily. At one time this paper served a useful purpose, but now the same information is available either free, or for a much lower cost at sites like Stocktables.com. I have strong opinions about William O'Neil (WON), IBD, which he founded, and the CANSLIM method of investing he tirelessly promotes. These opinions are my own, and I should say in fairness that he has many loyal followers. Basically CANSLIM is a gimicky momentum method of investing, more so than trading, though he never promoted the idea of "buy and hold". It is in its essence a method of identifying breakouts and exploiting them. It works well in strongly up trending markets, markets in which even a Chimp can make money, but is otherwise of little value. The stocks best suited to the CANSLIM style of investing do have one attribute in common: they are almost without exception among the stocks that fall the furthest in bear markets. This is not an attribute that is dwelled on to much extent in his well-known books. WON did, in his early days, make significant contributions to investing by researching the markets and compiling and publishing useful statistics regarding distribution and accumulation days, etc. and their significance. In particular he places great store in base building, cup and handle patterns, and breakout investing. His methods and investing philosophy are somewhat dated. He has attempted to boil stock investing down to simple rules, but unfortunately rules alone are not sufficient for consistent success at investing, good judgment honed through years of experience is also required. One example of the very bad advice he gives in his hopelessly outdated books is to avoid investing in foreign stocks. That should give you an idea. He is a rabid right-wing conservative, highly opinionated, as am I, and he uses the editorial pages of IBD to promote his brand of conservatism. IBD is outrageously expensive, considering that the information it contains is now available at much lower cost elsewhere. The IBD website uses outdated and poorly written software, dependent on Microsft Internet Explorer for full functionality and other Microsoft features that make it troublesome to use for anyone using Linux, or non-microsoft browsers. If you subscribe to IBD you will be inundated with IBD promotions and a constant stream of advertising on its web pages. IBD wants to sell you an endless list of "add on features", seminars etc. Although I have never met WON, My personal view of him formed through my former use of IBD and reading two of his books, books that are not particularly well written, is that he is first and foremost a business man out to make a buck. And he certainly can't be faulted for that. I just don't want it to be at my expense. I personally consider him to be a charleton and a snake oil saleman. Again this is only my personal opinion, and he does have many very loyal followers. Regardless, there can hardly be anyone alive on the planet who is more indefatigable at self-promotion. That said, my recommendation to anyone would be, give CANSLIM and IBD a try, you might find it more useful than i did. Afterall, what do you have to lose? Just $246, and that's a small price to pay for enlightenment.
I liked the IBD 100 before, especially when they first released it as they created a lot of volatitlity in low float stocks. But know as more people know about it, and small cap stocks are floundering, it is not as effective. Not to mention that IBD's methods are not as effective considering they are more geared toward small/microcap. The IBD index performance this year is quite lagging the SP since the smallcaps have been weak lately.
I want to apologize for the too personal remarks i made about WON in my earlier post. That was out of place and not totally objective. I would suggest anyone interested in CANSLIM investigate the performances of the mutual funds based on CANSLIM. There is a new fund which purportedly follows (exploits?) CANSLIM and i believe there was one started quite a few years ago. As far as i know the latter is now defunct.
Look out for big drops in the IBD 100 names that are illiquid. Part of CANSLIM is cutting losses, so there are frequently big exagerated shakeouts in those stocks. CANSLIM is a position trade strategy, but it doesn't consider the quality of the company and business in practice. Many of the IBD 100 touts of the last few years are now delisted.