I have a one legged monkey named publias that I have hop around on the IBD spread out all over the lab -- when he falls due to exhaustion I pick the one his tail is laying on... PEACE and good-trading, Commisso
Nice work Spyder'. Btw, does your ET name indicate your trading vehicle of choice? Salzburg, I moved your post to a new thread called papertrading a portfolio of stocks. It is still in the Trading Forum. Good luck!
You can usually count on KLAC, LLTC to go up when the market rallys. I've been watching them for a long time and they are consistent rally stocks. They were right on the money today, as usual.
Good call inandlong. Almost daily, I trade either the QQQ, DIA or SPY. However, I most frequently trade the QQQ. The Exchange Traded Funds (ETF's) have many advantages over individual equities (no uptick rule, spreads, less vulnerable to single 'bad news' report, etc.). I trade individual equities between 10:00 AM and 10:30 AM (Eastern) for the most part. occasionally, a trade will take me later into the day (no sell signal generated). The rest of the day I trade the ETF's or don't trade at all. I try to 'take what the market gives me' and trade accordingly. If the market gives me ten ETF trades, then I trade them. If the market hands me no trades, I won't force the issue. I use the downtime to learn additional methods for improving my trading.
That's funny...I've got position trade shorts on both PHM and SPF. Oops...oh well, we'll see...my short thesis is essentially playing interest rate direction as bonds sell off...thought homebuilders may have some exposure (land value may be inversely related to rates, which is a big part of their balance sheet, not sure how they finance -- but if they are exposed to floating rates this could hurt, their financing arms (lending as I understand it, is only a small part of their business) would suffer from rate increases, and of course consumer demand will taper off as rates rise). Couple all of this with general technical weakness in their sector and a selloff in bonds, and I decided to go short. They also carry a lot of debt which could compound the situation, I believe, no? Spyder, are you curious that all of those results in your screen are in the homebuilding sector? Do you think the way the homebuilder's balance sheets are comprised favors inclusion in your scan and disfavors the inclusion of other companies? Cheers, Mike D.
reid, if you recall from one of our other posts....both of these are in the basket that I constantly watch. Good opportunities, both Long and SHORT in these stocks everyday -FastTrader
In regards to your short position, you could easily have the right idea here. There is a second part of the Graham Equation that I do not use for trading purposes, but would for longer term holding purposes - and that is value. According to Graham, these three companies are hugely overvalued. For Graham, that meant nothing more than, he wouldn't buy them. For me, it means, I won't hold them very long. Graham calculated value accordingly: assets - liabilities / outstanding shares = Graham's Value Price Graham would buy a stock if the actual price was less than his calculated price, and sell when the actual price reached 90% of his calculated price. Of course, Graham didn't have to trade in an over valued market like today. When I first started running the screen, I too wondered why only stocks in the homebuilder sector appeared in the results. Then I recalled what Warren Buffet said not all that many months ago: He wouldn't buy anything right now. Mr. Buffet was probably referring to the lessons his old mentor Graham had taught him many years ago., and decided the whole market was too overvalued to apply Graham's teachings. Better to wait on the sidelines, or choose another investment vehicle. It could be that my screen is too strict. It could also mean that the rest of the 12,000 companies traded each day aren't doing as well as they would like us all to believe. Or, it could simply mean the market hasn't contracted enough yet, and we are still in the midst of a Bear Market. Whatever the actual reason turns out to be, I use the Graham Screen for adding stocks to my 'watch list' and then trade them like any other stock once something occurs to focus my interest.
Spyder, Your post comes at a timely juncture for me. I'm in the middle of Lowenstein's bio of Buffet, which as led me to put Graham's Intelligent Investor in the reading queue. I really like the thought behind your approach. If I may ask, what are you using to screen fundamentals? I don't subscribe to anything right now, but I may subscribe to Simplystocks.com. For the price, they have incredible data (historical financial statement line-items, both as-reported and standardized) that is also scannable. I think it's ~$360 a quarter or year or something...anyway compared to Compustat or Bloomberg, it's pennies. Do you use any other factors in putting things on your watch list? I have a friend at a fundamental-based hedge fund. They lean heavily on EV/EBITDA for relative valuation....I think all of this would work very well in a beta-adjusted market neutral portfolio. Thoughts? MYD
For this situation, I use the free MSN Deluxe Screener and a list of criteria. The main reason being, I am not as familiar (yet) with the screening software I recently purchased. After a company appears in the results, I used to use http://www.hoovers.com because the data I seek was located all on one page. Since Hoovers has recently altered their page - charging now for what once was free - I will be finding another source. I started to use zacks.com recently, and that seems to work o.k., for now, until I can learn to use all the bells and whistles at my disposal.
... Portfolio??? Never will do that... Hey... just BUY: ES and NQ... that's probably good enough for me...