Kua`aina Partners
A Conglomerate...

Format for Printing

Format for printing

Request Reprints


By comptche
October 2, 2002

Posts selected for this feature rarely stand alone. They are usually a part of an ongoing thread, and are out of context when presented here. The material should be read in that light. How are these posts selected? Click here to find out and nominate a post yourself!

Hi KP,

This is a day of stopping in out of real life, a breather from caregiving, a diversion and a way to jot down thoughts so that they will not fly away.

After the WTS seminar, I have done a lot of thinking about all that I have learned, Mechanical Investing, Fundamental Analysis (Rule Maker), Technical Analysis, NJTA, and now When To Sell. I have also been reading about the methods of IBD in selecting and selling stocks, and dabbling in NAIC methods as well. It seems to me that all of these ways of calculating the worth of a company have value and all have drawbacks of one kind or another.

I would like to participate in a group effort in using all of these together to help in choosing stocks and in knowing when to sell for a profit or to stem a loss. I am sure that excellent use of each one of these methods will result in a good portfolio that will make a profit. I also know that judgment plays a role in each of them. Some methods fit some markets better than other markets. It seems to me that using information from all of the above would result in better information. By doing an experiment as a group, we might be able to choose the parts of each method that will best work with other methods to achieve a good, well rounded method that each of us can adapt for our own needs.

The suggestion that I have currently goes like this: Making up a portfolio has three parts, choosing stocks, buying stocks at a good time, and selling them at a good time. Most of us have experience in one or another or many of the methods available. I would suggest that we split up and teach our own methods to the others through stocks that we find and evaluate and then through signs that show we should be selling or holding those stocks. We could develop a core portfolio to demonstrate to ourselves how things are going. We can even do things such as buying and selling in more than one way to create an experiment from which to learn. If we each took a small part in the whole, we might learn more quickly than if one of us did it alone.

Here is my thinking about how to find stocks right now: Use the Mechanical Investment Screens to find the stocks that appear there at this time. This has the advantage of keeping us current in individual stocks that are peaking and in the size, smallcaps, midcaps, largecaps, that are currently peaking. Those could be screened by use of the Point and Figure Charts for good patterns. Next they could be screened by use of IBD and NAIC criteria as shortcuts to Fundamental Analysis. Other FA could also be used. NJTA and IBD analysis could be used to determine buy times and hold times and sell times. Other TA could also be brought in. Some "red flags" and other criteria from WTS can also be brought in to add to the sell times information.

By combining these methods, we might see which of the details of those methods best predict outcomes, or which combinations are good predictors. We would have a better view of individual companies as well as good market analysis through watching IBDs top industries and other trends. Again, as a group, we could cover more bases than one person might be able to cover. By having a broad base of exploration, we might be in a better position to see what is happening than if we concentrated on one method.

This is a shotgun approach that could lead to a more refined approach or to a continued shotgun approach. Is anyone interested in doing this? If so, do you have another way to go? If you are happy with what you are doing right now and are not interested, that's your way...

I will not comment on the WTS seminar now as I am awaiting Erick's comments. There are good things we can use, but it is not a tight method such as NJTA or IBD. (Erick, can I share my "Sell Guide" without doing something to undercut MTF seminar rights?)

Anne, planning the use of the uncertain market times for study...and getting ready for the next bull market, no matter how tame...

Become a Complete Fool
Join the best community on the web! Becoming a full member of the Fool Community is easy, takes just a minute, and is very inexpensive.