To make money with buy and hold you must

Discussion in 'Strategy Development' started by stock_trad3r, Apr 5, 2007.

  1. buy stocks that go up

    That is my number one pice of advice and while it may seem painfuly obvious many investors seem to be able to follow that rule.

    They buy stocks that underperform the market costing thousands of dollars and resulting in anger and anguish.

    When you buy a stock the goal is to eventually sell the stock at a higher price than you paid for it. The greatest fundementals and potential in the world wont help you if the stock doesn't up after you enter a buy order and it is filled.

    Do how do you find stocks with a tendency to go up?

    Go to barchart.com and use the hig/low screener

    Screen stocks that are at a 30-6-and 90 day highs and pick the ones with the most new highs.

    make sure the chart shows steady buying presure. no violent dips or spires. Just a gentle slope.

    Take your funds and divide them equally amoung 3-5 of them.

    And sit back and watch the moeny flow in

    Sell b4 an earnings number or if you decided you made enough money

    Follow o-neils 7% sell rule though if the pick goes against you
     
  2. Lets see your blotters hotshot. :D
     
  3. ...stay in the market for decades if you want to guarantee you'll beat a measley little T-bill....

    http://tinyurl.com/2n3ufb

    The better alternative, of course, is to time the markets provided that you know how to design, test and monitor a strategy.
     
  4. Some of my best performers (AET, GT, EMS) have been 52 week lows.
     
  5. On the contrary, some of my best performers were found using this method

    to each his own
     
  6. I don't doubt that.

    I was making the point that there is no exclusive 'right' way to pick stocks.

    The advice to buy stocks only when they are at 52 week highs it horrible. It depends on a variety of factors whether it is prudent to by a stock, at any point.
     
  7. thats why I always say if your looking to buy and hold for a retirement type time herizon... dollar cost avg into the indexes. simple,.
     
  8. A low maintenance buy and hold that would make money assuming the markets go up (like they always have) is to just buy some ETF's and dollar cost average into them if you can.

    Stocks come and go, but the Dow, the S&P, the Nasdaq, the Russell, etc. are not going anywhere.

    If you believe the indexes will always rise, buying index etf's is a great low cost, low maintenance option.
     
  9. Daal

    Daal

    How much you guys expect to make in % yearly through these buy and holds?I hope its more than what the dollar is dropping every year
     
  10. vetten

    vetten

    hello stock trader,

    I agree that what you have is a good system.
    ok, it will have its losses but you should be able to make 25-50%
    profits depending on the market.

    A simular strategy with all the facts like money management etc
    is available at alanhull.com.au
    I dont have anything to do with this site and I am not trading this strategy at the moment but am defenitely interested.

    Another thought is like this: In the SP500 look for the top companies gone up the most in the last month and buy say the top 5 or top 10. Every day scan the market again and if one of your holdings moved out of the top 20 (to give it a bit of moving space) sell it and buy number 5 or number 10.
    I would set a stop loss at 3-5% maximum, because I want to be in with the runners, not the losers
    There will be quite a bit of trading, but brokers like IB are cheap.
    This is for your long portfolio.
    The opposite for your short portfolio.
    In this way you are always market neutral.

    Would be nice to play around with this concept and make changes to be sharper.

    Anybody doing this kind of strategy?:)
     
    #10     Apr 5, 2007