From: owner-canslim-digest@lists.xmission.com (canslim-digest) To: canslim-digest@lists.xmission.com Subject: canslim-digest V2 #1946 Reply-To: canslim Sender: owner-canslim-digest@lists.xmission.com Errors-To: owner-canslim-digest@lists.xmission.com Precedence: bulk Content-Transfer-Encoding: quoted-printable X-No-Archive: yes canslim-digest Thursday, December 13 2001 Volume 02 : Number 1946 In this issue: Re: [CANSLIM] Performance Re: [CANSLIM] please remove me from canslim Re: [CANSLIM] SOME FEEDBACK NEEDED! RE: [CANSLIM] new edition of htmmis Re: [CANSLIM] low volume breakouts [CANSLIM] spam from cwhCharts.com Re: [CANSLIM] low volume breakouts Re: [CANSLIM] clarification ---------------------------------------------------------------------- Date: Thu, 13 Dec 2001 12:44:35 -0600 From: "Katherine Malm" Subject: Re: [CANSLIM] Performance This is a multi-part message in MIME format. - ------=_NextPart_000_0135_01C183D3.EB52E120 Content-Type: text/plain; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable My apologies to the group for forgetting to strip the ad before sending. ----- Original Message -----=20 From: Katherine Malm=20 To: CANSLIM List Posting=20 Sent: Thursday, December 13, 2001 12:37 PM Subject: [CANSLIM] Performance Gary is a regular columnist at RealMoney.com. This week, he did a = survey asking respondents what sort of returns they generated during = 2001. This column is his response. Can't get any simpler than this-- Katherine How to Avoid Another Losing Year By Gary B. Smith Special to TheStreet.com - ------=_NextPart_000_0135_01C183D3.EB52E120 Content-Type: text/html; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable
My apologies to the group for = forgetting to strip=20 the ad before sending.
----- Original Message -----
From:=20 Katherine=20 Malm
To: CANSLIM List Posting
Sent: Thursday, December 13, = 2001 12:37=20 PM
Subject: [CANSLIM] = Performance

Gary is a regular columnist at = RealMoney.com.=20 This week, he did a survey asking respondents what sort of returns = they=20 generated during 2001. This column is his response. Can't get any = simpler than=20 this--
 
Katherine
 
How to Avoid Another Losing=20 Year
By=20 Gary B. Smith
Special to=20 TheStreet.com
- ------=_NextPart_000_0135_01C183D3.EB52E120-- - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. ------------------------------ Date: Thu, 13 Dec 2001 13:34:39 -0500 From: "Dan Forant" Subject: Re: [CANSLIM] please remove me from canslim Had enough huh? DanF - ----- Original Message ----- From: "Richard Dennis" To: Sent: Thursday, December 13, 2001 9:34 AM Subject: [CANSLIM] please remove me from canslim > address: thtxn@yahoo.com > > __________________________________________________ > Do You Yahoo!? > Check out Yahoo! Shopping and Yahoo! Auctions for all of > your unique holiday gifts! Buy at http://shopping.yahoo.com > or bid at http://auctions.yahoo.com > > - > -To subscribe/unsubscribe, email "majordomo@xmission.com" > -In the email body, write "subscribe canslim" or > -"unsubscribe canslim". Do not use quotes in your email. > - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. ------------------------------ Date: Thu, 13 Dec 2001 17:04:54 -0800 From: "Mike Hofmann" Subject: Re: [CANSLIM] SOME FEEDBACK NEEDED! This is a multi-part message in MIME format. - ------=_NextPart_000_0212_01C183F8.496DDF70 Content-Type: text/plain; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable Tom, I'm way behind the times on this and don't think I can add much to the = overwhelming response, but I do want to chime in to thank you for your = work. If I was forced at gunpoint to choose a single best aspect of this = terrific message board, I think your WWW and CANSLIM candidate lists = would be it. Please keep up the good work! Mike ----- Original Message -----=20 From: Gracephyll@cs.com=20 To: canslim@lists.xmission.com=20 Sent: Wednesday, December 12, 2001 4:55 PM Subject: Re: [CANSLIM] SOME FEEDBACK NEEDED! Tom,=20 As a newbie inthe investing world, I learn so much from your = commentaries. I enjoy your insights. I still have so many basics to = learn, and I find that you offer opinions and insights that help me to = put things into perspective for myself.=20 I use your comments on charts and basing patterns to learn by.=20 Please DO continue and know that I appreciate your sharings and = effort.=20 Consider yourself hugged.=20 Phyllis =20 - ------=_NextPart_000_0212_01C183F8.496DDF70 Content-Type: text/html; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable
Tom,
 
I'm way behind the times on this and = don't think I=20 can add much to the overwhelming response, but I do want to chime in to = thank=20 you for your work. If I was forced at gunpoint to choose a single best = aspect of=20 this terrific message board, I think your WWW and CANSLIM candidate = lists would=20 be it.
 
Please keep up the good = work!
 
Mike
 
----- Original Message -----
From:=20 Gracephyll@cs.com
Sent: Wednesday, December 12, = 2001 4:55=20 PM
Subject: Re: [CANSLIM] SOME = FEEDBACK=20 NEEDED!

Tom,
As = a newbie=20 inthe investing world, I learn so much from your commentaries.  I = enjoy=20 your insights.  I still have so many basics to learn, and I find = that you=20 offer opinions and insights that help me to put things into = perspective for=20 myself.

I use your comments on charts and basing patterns to = learn by.=20

Please DO continue and know that I appreciate your sharings = and=20 effort.
Consider yourself hugged.

Phyllis =   =20 - ------=_NextPart_000_0212_01C183F8.496DDF70-- - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. ------------------------------ Date: Thu, 13 Dec 2001 19:48:40 -0600 From: "John Adair" Subject: RE: [CANSLIM] new edition of htmmis Can anyone tell me when the new edition of htmmis by won will be available - -----Original Message----- From: owner-canslim@lists.xmission.com [mailto:owner-canslim@lists.xmission.com]On Behalf Of camelot.homes@charter.net Sent: Wednesday, December 12, 2001 9:52 PM To: canslim@lists.xmission.com Subject: Re: [CANSLIM] clarification eric, but how about the hugh returns that kacher, morales, ryan, kuhn have gotten in the past using the canslim system. i believe in readings WON gets a more modest 40% a year-of course i might be wrong about that. david - ----- Original Message ----- From: "Tangen, Eric" To: Sent: Wednesday, December 12, 2001 9:41 PM Subject: RE: [CANSLIM] clarification > The 40% number is an amalgam of a number of anecdotes from a few different > sources. Its all word of mouth. No names to given protect the guilty. > > You can almost infer such a number from WON himself...I'd bet if you asked > the big-O-man in a seminar he'd deflect the question to point out how much > you are ahead having 1 big gain out of 2-5 trades. > > > ERIC TANGEN > > -----Original Message----- > From: camelot.homes@charter.net [mailto:camelot.homes@charter.net] > Sent: Wednesday, December 12, 2001 9:16 PM > To: canslim@lists.xmission.com > Subject: Re: [CANSLIM] clarification > > > eric, how do you get the 40% reliability of the WON breakout? david frank > ----- Original Message ----- > From: "Tangen, Eric" > To: > Sent: Wednesday, December 12, 2001 8:57 PM > Subject: RE: [CANSLIM] clarification > > > > Of course you are right...risk is the stop value itself...it is what you > > loose when your stop is triggered. It is what I mean but didn't say > > correctly. > > > > This is what happens when I try to communicate math verbally...the two > don't > > mix. :) > > > > ERIC TANGEN > > > > > > > > -----Original Message----- > > From: John Adair [mailto:xjadair@brightok.net] > > Sent: Wednesday, December 12, 2001 8:48 PM > > To: canslim@lists.xmission.com > > Subject: RE: [CANSLIM] clarification > > > > > > Hi Erick > > If I am reading your post right correctly you would say your risk > > on a $50 > > stock with a $5.00 stop would be $50.00 -$5.00 or $45.00. If that is what > > you are saying I would not agree I would say your risk is $5.00 if I > > understand what Tharp suggests. Tharp then limits your risk to the 1% is > > based on that figure 1% ( 3% for the gunslinger) of your total capitol. > > John Adair > > > > -----Original Message----- > > From: owner-canslim@lists.xmission.com > > [mailto:owner-canslim@lists.xmission.com]On Behalf Of Tangen, Eric > > Sent: Wednesday, December 12, 2001 7:19 PM > > To: 'canslim@lists.xmission.com' > > Subject: RE: [CANSLIM] clarification > > > > The latter....your risk is your buy price less the stop. Rule of thumb: > that > > number should be 1% or less of your total trading capital. So if you want > in > > on a more volatile stock, just buy less of it...but don't set the stop at > > 7-8% if the stock has a 10% daily trading range - another point HTMMIS > > doesn't address. > > > > Trading any system with a 7-8% risk for each trade is a receipe for > > disaster. The pros use a 1% limit. If (as in HTMMIS suggest) you split up > > your capital evenly amoung 5-6 stocks and used an arbitrary 7-8% stop > loss, > > statistically, it would be very easy to get enough losing trades to loose > > all your money. The unspoken 40% reliability of the WON breakouts only > makes > > this bad situation worse. > > > > I'm afraid that a quick reading of HTMMIS gives the impression that if you > > can identify the perfect C+H setup and all the other CANSLIM criteria are > in > > place, you can get darn near 100% reliability of a breakout. I have a big > > problem with that. > > > > I'm not down on CANSLIM...just like people to know the reality of the > > situation. Your going for home runs here and home run hitters have a lot > of > > strikeouts. > > > > > > ERIC TANGEN > > > > -----Original Message----- > > From: Katherine Malm [mailto:kmalm@earthlink.net] > > Sent: Wednesday, December 12, 2001 2:02 PM > > To: canslim@lists.xmission.com > > Subject: Re: [CANSLIM] clarification > > > > > > >>If you put 7-8% of your trading capital > > > at risk on any one trade > > > > Now that I've been mulling over your comment, it begs another question. > Are > > you suggesting the *total* monies invested in a trade are "at risk"? Or > the > > amount which you've specified in downside stop-loss protection as "at > > risk."? > > > > Katherine > > > > > > ----- Original Message ----- > > From: "Tangen, Eric" > > To: > > Sent: Wednesday, December 12, 2001 1:46 PM > > Subject: RE: [CANSLIM] clarification > > > > > > > Welcome to the club! Breakouts are a high risk and high reward > strategy - > > if > > > you're batting .500, that's pretty darn good. You should expect 40% > > success > > > at finding successful breakouts long-term. > > > > > > I just have to get this off my chest for the new subscribers...WON's > 7-8% > > > stop below the pivot is a technical stop. It is a rule of thumb based on > > > volatility in the handle region before a stock takes off. > > > > > > It is NOT A MONEY MANAGEMENT STOP!. If you put 7-8% of your trading > > capital > > > at risk on any one trade, you will eventually pay some really serious > Wall > > > Street tuition on the path to becoming successful trader. > > > > > > WON's work has virtually nothing in the area of money management (what > he > > > does say is just plain outdated...by 5 stocks with 100k...more > appropriate > > > to an era of high commissions and lower volatility). > > > > > > Tharp's books are the best (only?) work in this area and should be > > required > > > reading before you head out to the great casino that is Wall Street. > > > > > > ERIC TANGEN > > > > > > > > - > > -To subscribe/unsubscribe, email "majordomo@xmission.com" > > -In the email body, write "subscribe canslim" or > > -"unsubscribe canslim". Do not use quotes in your email. > > > > - > > -To subscribe/unsubscribe, email "majordomo@xmission.com" > > -In the email body, write "subscribe canslim" or > > -"unsubscribe canslim". Do not use quotes in your email. > > > > > > - > > -To subscribe/unsubscribe, email "majordomo@xmission.com" > > -In the email body, write "subscribe canslim" or > > -"unsubscribe canslim". Do not use quotes in your email. > > > > - > > -To subscribe/unsubscribe, email "majordomo@xmission.com" > > -In the email body, write "subscribe canslim" or > > -"unsubscribe canslim". Do not use quotes in your email. > > > - > -To subscribe/unsubscribe, email "majordomo@xmission.com" > -In the email body, write "subscribe canslim" or > -"unsubscribe canslim". Do not use quotes in your email. > > - > -To subscribe/unsubscribe, email "majordomo@xmission.com" > -In the email body, write "subscribe canslim" or > -"unsubscribe canslim". Do not use quotes in your email. - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. ------------------------------ Date: Thu, 13 Dec 2001 20:59:46 EST From: Spencer48@aol.com Subject: Re: [CANSLIM] low volume breakouts Katherine: What does the 12 days refer to. I know that you distinguished-in your answer-between throwback and retracement, but I'm not certain if you mean that a throwback could occur, according to Bulkowsi, 12 days AFTER the BO. Or, perhaps, he means that once the throwback occurs it can LAST12 days before the stock Breaks Out again, ie. when the stock does retrace to the BO point, it remains below that point for on average 12 days. jans In a message dated 12/10/2001 7:16:48 AM Eastern Standard Time, kmalm@earthlink.net writes: << ...Stocks retrace back to the B/O point 75% of the time (average time 12 days). >> - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. ------------------------------ Date: Thu, 13 Dec 2001 21:01:11 -0500 From: "Ann" Subject: [CANSLIM] spam from cwhCharts.com Did anyone else receive this spam? Does anyone know anything about the site? Ann - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. ------------------------------ Date: Thu, 13 Dec 2001 19:54:15 -0600 From: "Katherine Malm" Subject: Re: [CANSLIM] low volume breakouts Sorry about the confusion, jans. Probably unclear in my haste to write up the summary. Once the stock breaks out above the pivot, 74% of the time the price will retrace/throwback/pullback to the pivot. On average, this pullback takes 12 days. As long as it holds above the pivot and then moves up, it is considered a successful B/O. If it falls below the pivot, it is considered a failure. The notes I wrote last night showed the failure rates, but I can't remember them off the top of my head. Katherine - ----- Original Message ----- From: To: Sent: Thursday, December 13, 2001 7:59 PM Subject: Re: [CANSLIM] low volume breakouts > Katherine: > > What does the 12 days refer to. > > I know that you distinguished-in your answer-between throwback and > retracement, but I'm not certain if you mean that a throwback could occur, > according to Bulkowsi, 12 days AFTER the BO. Or, > perhaps, he means that once the throwback occurs it can LAST12 days before > the stock Breaks Out again, ie. when the stock does retrace to the BO point, > it remains below that point for on average 12 days. > > jans > > > In a message dated 12/10/2001 7:16:48 AM Eastern Standard Time, > kmalm@earthlink.net writes: > > << ...Stocks retrace back to the B/O point 75% of the time (average time 12 > days). >> > > - > -To subscribe/unsubscribe, email "majordomo@xmission.com" > -In the email body, write "subscribe canslim" or > -"unsubscribe canslim". Do not use quotes in your email. - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. ------------------------------ Date: Thu, 13 Dec 2001 20:22:31 -0600 From: "Norman" Subject: Re: [CANSLIM] clarification This is a multi-part message in MIME format. - ------=_NextPart_000_0076_01C18413.E4BBC300 Content-Type: text/plain; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable follow up in blue after your comments. Thx Norm ----- Original Message -----=20 From: Katherine Malm=20 To: canslim@lists.xmission.com=20 Sent: Thursday, December 13, 2001 7:10 AM Subject: Re: [CANSLIM] clarification Norm, See my notes in bold. In general, he is trying to match the formation to WON's criteria. = When looking for the C&H pattern, cups had to have handles of at least = one week to qualify. Handles had to be in upper half, but there were = some in the study that were marginally in the upper half and included = anyway. Cups had to be U shaped. No V shapes were included. (Guess he = doesn't like drinking his coffee from a funnel.) Price has to have risen = 30% before the cup was formed. Cup has to take 7 to 65 weeks to form.=20 Thanks for relaying the interesting Bulkowski info. Mr. B = definitely is on my coffee table list. I have a 'couple' of questions. 1) "Cups with higher right lips tend to outperform those with a = higher left lip." Why would this be? Who knows? It's a mystery. But the = differences were statistically significant. 2) "Failure rate if waited for upside B/O 5%." Is 'upside B/O' when = it goes above the left side? B/O occurs when it breaks above the high of = the handle. Actually the 5% failure was in reference to the C w/o H = breakouts. Does vol play a roll here? I was interested if hi vol was = studied for a BO above the LS of a cup. He did not include volume as = criteria for B/O because removing the criteria hurt performance, but = only slightly. He does give statistics on volume at breakout and after, = and the volume tends to be very high. Only 5% failure with these C w/o H = is surprising. And failure is when the price falls back to the pivot? = No, failure is when the price falls below the pivot and heads down. A = pullback to the pivot that subsequently moves on is considered a = "throwback" or pullback, and is not considered a failure. This chapter alone is worth the price of the book. The ROI makes = this investment a big winner. Katherine Norm ----- Original Message -----=20 From: "Katherine Malm" To: Sent: Wednesday, December 12, 2001 10:18 PM Subject: Re: [CANSLIM] clarification > Bulkowski (Encyclopedia of Chart Patterns) gives statistics on C&H = and cups > w/o handles: >=20 > C&H: > Failure rate 26% > Failure rate if waited for B/O 10% <<<<--------------<<<<<<<<< > Average rise 38%, most likely 10-20% > Cups with higher right lips tend to outperform those with a higher = left lip. > Avg gain 40% vs 35%. >=20 > C w/o H (Rounding Bottoms): > Failure rate 38% > Failure rate if waited for upside B/O 5% = <<<<---------------<<<<<<<<< > Average rise 54%, most likely 20% >=20 > Nothing on flat bases. >=20 > Katherine > ----- Original Message ----- > From: "Tangen, Eric" > To: > Sent: Wednesday, December 12, 2001 9:41 PM > Subject: RE: [CANSLIM] clarification >=20 >=20 > > The 40% number is an amalgam of a number of anecdotes from a few = different > > sources. Its all word of mouth. No names to given protect the = guilty. > > > > You can almost infer such a number from WON himself...I'd bet if = you asked > > the big-O-man in a seminar he'd deflect the question to point = out how much > > you are ahead having 1 big gain out of 2-5 trades. > > > > > > ERIC TANGEN > > > > -----Original Message----- > > From: camelot.homes@charter.net = [mailto:camelot.homes@charter.net] > > Sent: Wednesday, December 12, 2001 9:16 PM > > To: canslim@lists.xmission.com > > Subject: Re: [CANSLIM] clarification > > > > > > eric, how do you get the 40% reliability of the WON breakout? = david frank > > ----- Original Message ----- > > From: "Tangen, Eric" > > To: > > Sent: Wednesday, December 12, 2001 8:57 PM > > Subject: RE: [CANSLIM] clarification > > > > > > > Of course you are right...risk is the stop value itself...it = is what you > > > loose when your stop is triggered. It is what I mean but = didn't say > > > correctly. > > > > > > This is what happens when I try to communicate math = verbally...the two > > don't > > > mix. :) > > > > > > ERIC TANGEN > > > > > > > > > > > > -----Original Message----- > > > From: John Adair [mailto:xjadair@brightok.net] > > > Sent: Wednesday, December 12, 2001 8:48 PM > > > To: canslim@lists.xmission.com > > > Subject: RE: [CANSLIM] clarification > > > > > > > > > Hi Erick > > > If I am reading your post right correctly you would say your = risk > > > on a $50 > > > stock with a $5.00 stop would be $50.00 -$5.00 or $45.00. If = that is > what > > > you are saying I would not agree I would say your risk is = $5.00 if I > > > understand what Tharp suggests. Tharp then limits your risk to = the 1% > is > > > based on that figure 1% ( 3% for the gunslinger) of your total = capitol. > > > John Adair > > > > > > -----Original Message----- > > > From: owner-canslim@lists.xmission.com > > > [mailto:owner-canslim@lists.xmission.com]On Behalf Of Tangen, = Eric > > > Sent: Wednesday, December 12, 2001 7:19 PM > > > To: 'canslim@lists.xmission.com' > > > Subject: RE: [CANSLIM] clarification > > > > > > The latter....your risk is your buy price less the stop. Rule = of thumb: > > that > > > number should be 1% or less of your total trading capital. So = if you > want > > in > > > on a more volatile stock, just buy less of it...but don't set = the stop > at > > > 7-8% if the stock has a 10% daily trading range - another = point HTMMIS > > > doesn't address. > > > > > > Trading any system with a 7-8% risk for each trade is a = receipe for > > > disaster. The pros use a 1% limit. If (as in HTMMIS suggest) = you split > up > > > your capital evenly amoung 5-6 stocks and used an arbitrary = 7-8% stop > > loss, > > > statistically, it would be very easy to get enough losing = trades to > loose > > > all your money. The unspoken 40% reliability of the WON = breakouts only > > makes > > > this bad situation worse. > > > > > > I'm afraid that a quick reading of HTMMIS gives the impression = that if > you > > > can identify the perfect C+H setup and all the other CANSLIM = criteria > are > > in > > > place, you can get darn near 100% reliability of a breakout. I = have a > big > > > problem with that. > > > > > > I'm not down on CANSLIM...just like people to know the reality = of the > > > situation. Your going for home runs here and home run hitters = have a lot > > of > > > strikeouts. > > > > > > > > > ERIC TANGEN > > > > > > -----Original Message----- > > > From: Katherine Malm [mailto:kmalm@earthlink.net] > > > Sent: Wednesday, December 12, 2001 2:02 PM > > > To: canslim@lists.xmission.com > > > Subject: Re: [CANSLIM] clarification > > > > > > > > > >>If you put 7-8% of your trading capital > > > > at risk on any one trade > > > > > > Now that I've been mulling over your comment, it begs another = question. > > Are > > > you suggesting the *total* monies invested in a trade are "at = risk"? Or > > the > > > amount which you've specified in downside stop-loss protection = as "at > > > risk."? > > > > > > Katherine > > > > > > > > > ----- Original Message ----- > > > From: "Tangen, Eric" > > > To: > > > Sent: Wednesday, December 12, 2001 1:46 PM > > > Subject: RE: [CANSLIM] clarification > > > > > > > > > > Welcome to the club! Breakouts are a high risk and high = reward > > strategy - > > > if > > > > you're batting .500, that's pretty darn good. You should = expect 40% > > > success > > > > at finding successful breakouts long-term. > > > > > > > > I just have to get this off my chest for the new = subscribers...WON's > > 7-8% > > > > stop below the pivot is a technical stop. It is a rule of = thumb based > on > > > > volatility in the handle region before a stock takes off. > > > > > > > > It is NOT A MONEY MANAGEMENT STOP!. If you put 7-8% of your = trading > > > capital > > > > at risk on any one trade, you will eventually pay some = really serious > > Wall > > > > Street tuition on the path to becoming successful trader. > > > > > > > > WON's work has virtually nothing in the area of money = management (what > > he > > > > does say is just plain outdated...by 5 stocks with = 100k...more > > appropriate > > > > to an era of high commissions and lower volatility). > > > > > > > > Tharp's books are the best (only?) work in this area and = should be > > > required > > > > reading before you head out to the great casino that is Wall = Street. > > > > > > > > ERIC TANGEN > > > > > > > > > > > > - > > > -To subscribe/unsubscribe, email "majordomo@xmission.com" > > > -In the email body, write "subscribe canslim" or > > > -"unsubscribe canslim". Do not use quotes in your email. > > > > > > - > > > -To subscribe/unsubscribe, email "majordomo@xmission.com" > > > -In the email body, write "subscribe canslim" or > > > -"unsubscribe canslim". Do not use quotes in your email. > > > > > > > > > - > > > -To subscribe/unsubscribe, email "majordomo@xmission.com" > > > -In the email body, write "subscribe canslim" or > > > -"unsubscribe canslim". Do not use quotes in your email. > > > > > > - > > > -To subscribe/unsubscribe, email "majordomo@xmission.com" > > > -In the email body, write "subscribe canslim" or > > > -"unsubscribe canslim". Do not use quotes in your email. > > > > > > - > > -To subscribe/unsubscribe, email "majordomo@xmission.com" > > -In the email body, write "subscribe canslim" or > > -"unsubscribe canslim". Do not use quotes in your email. > > > > - > > -To subscribe/unsubscribe, email "majordomo@xmission.com" > > -In the email body, write "subscribe canslim" or > > -"unsubscribe canslim". Do not use quotes in your email. >=20 >=20 > - > -To subscribe/unsubscribe, email "majordomo@xmission.com" > -In the email body, write "subscribe canslim" or > -"unsubscribe canslim". Do not use quotes in your email. >=20 >=20 >=20 - ------=_NextPart_000_0076_01C18413.E4BBC300 Content-Type: text/html; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable
follow up in blue after your=20 comments.
 
Thx
 
Norm
----- Original Message -----
From:=20 Katherine=20 Malm
Sent: Thursday, December 13, = 2001 7:10=20 AM
Subject: Re: [CANSLIM]=20 clarification

 
Norm,
 
See my notes in = bold.
 
In general, he is trying to = match the=20 formation to WON's criteria. When looking for the C&H pattern, = cups had=20 to have handles of at least one week to qualify. Handles had to be = in upper=20 half, but there were some in the study that were marginally in the = upper=20 half and included anyway. Cups had to be U shaped. No V shapes = were=20 included. (Guess he doesn't like drinking his coffee from a funnel.) = Price=20 has to have risen 30% before the cup was formed. Cup has to = take 7 to=20 65 weeks to form.
 
Thanks for relaying the interesting Bulkowski info.  Mr. B = definitely is on my coffee table list.  I have a = 'couple' of=20 questions.
 
1) "Cups with higher right lips tend to = outperform=20 those with a higher left lip."  Why would this be? = Who=20 knows? It's a mystery. But the differences were statistically=20 significant.
 
2) "Failure rate if waited for upside B/O = 5%."  Is 'upside B/O' when it goes above the left side?=20 B/O occurs when it breaks above the high of the=20 handle. Actually the 5% failure = was in=20 reference to the C w/o H breakouts.  Does vol play a = roll=20 here?  I was interested if hi vol=20 was studied for a BO above the LS of a cup. =20  He did not include volume as = criteria for B/O=20 because removing the criteria hurt = performance, but only=20 slightly. He does give statistics on volume at = breakout and after, and the volume tends to be very high. = Only 5%=20 failure with these C w/o H is = surprising. =20 And failure is when the price falls back to the pivot? No, = failure=20 is when the price falls below the pivot and heads down. A pullback = to the=20 pivot that subsequently moves on is considered a "throwback" or = pullback,=20 and is not considered a failure.
 
This chapter alone is worth the price of the book. The = ROI=20 makes this investment a big winner.
 
Katherine
 
Norm
----- Original Message -----=20
From: "Katherine Malm" <kmalm@earthlink.net>
To: <canslim@lists.xmission.com= >
Sent: Wednesday, December 12, 2001 10:18 PM
Subject: Re: [CANSLIM] clarification

> Bulkowski (Encyclopedia of Chart Patterns) gives = statistics on C&H and cups
> w/o handles:
>
> = C&H:
> Failure rate 26%
> Failure rate if waited for = B/O 10%=20 = <<<<--------------<<<<<<<<<
>= ;=20 Average rise 38%, most likely 10-20%
> Cups with higher right = lips=20 tend to outperform those with a higher left lip.
> Avg gain = 40% vs=20 35%.
>
> C w/o H (Rounding Bottoms):
> Failure = rate=20 38%
> Failure rate if waited for upside B/O 5%=20 = <<<<---------------<<<<<<<<<
&g= t;=20 Average rise 54%, most likely 20%
>
> Nothing on flat=20 bases.
>
> Katherine
> ----- Original Message=20 -----
> From: "Tangen, Eric" <tangene@tycoelectronics.com>
>=20 To: <canslim@lists.xmission.com= >
>=20 Sent: Wednesday, December 12, 2001 9:41 PM
> Subject: RE: = [CANSLIM]=20 clarification
>
>
> > The 40% number is an = amalgam of=20 a number of anecdotes from a few different
> > sources. Its = all=20 word of mouth. No names to given protect the guilty.
> = >
>=20 > You can almost infer such a number from WON himself...I'd bet = if you=20 asked
> > the big-O-man in a seminar he'd deflect the = question to=20 point out how much
> > you are ahead having 1 big gain out = of 2-5=20 trades.
> >
> >
> > ERIC TANGEN
>=20 >
> > -----Original Message-----
> > From: camelot.homes@charter.net=20 [mailto:camelot.homes@charter.net]
> > Sent: Wednesday, = December=20 12, 2001 9:16 PM
> > To: canslim@lists.xmission.com=
>=20 > Subject: Re: [CANSLIM] clarification
> >
> = >
>=20 > eric, how do you get the 40% reliability of the WON breakout? = david=20 frank
> > ----- Original Message -----
> > From: = "Tangen,=20 Eric" <tangene@tycoelectronics.com>
>=20 > To: <canslim@lists.xmission.com= >
>=20 > Sent: Wednesday, December 12, 2001 8:57 PM
> > = Subject: RE:=20 [CANSLIM] clarification
> >
> >
> > > = Of=20 course you are right...risk is the stop value itself...it is what=20 you
> > > loose when your stop is triggered. It is what = I mean=20 but didn't say
> > > correctly.
> > = >
> >=20 > This is what happens when I try to communicate math = verbally...the=20 two
> > don't
> > > mix. :)
> > = >
>=20 > > ERIC TANGEN
> > >
> > >
> = >=20 >
> > > -----Original Message-----
> > > = From:=20 John Adair [mailto:xjadair@brightok.net]
> > > Sent: = Wednesday,=20 December 12, 2001 8:48 PM
> > > To: canslim@lists.xmission.com=
>=20 > > Subject: RE: [CANSLIM] clarification
> > = >
>=20 > >
> > > Hi Erick
> > > If I am = reading your=20 post right  correctly you would say your risk
> > > = on a=20 $50
> > > stock with a $5.00 stop would be  $50.00 = - -$5.00=20 or $45.00. If that is
> what
> > > you are = saying  I=20 would not agree I would say your risk is $5.00  if I
> = > >=20 understand what Tharp suggests. Tharp then limits your risk to  = the=20 1%
> is
> > > based on that figure 1% ( 3% for the = gunslinger) of your total  capitol.
> > > John=20 Adair
> > >
> > > -----Original = Message-----
>=20 > > From: owner-canslim@lists.xmis= sion.com
>=20 > > [mailto:owner-canslim@lists.xmission.com]On Behalf Of = Tangen,=20 Eric
> > > Sent: Wednesday, December 12, 2001 7:19 = PM
>=20 > > To: 'canslim@lists.xmission.com'=
>=20 > > Subject: RE: [CANSLIM] clarification
> > = >
>=20 > > The latter....your risk is your buy price less the stop. = Rule of=20 thumb:
> > that
> > > number should be 1% or = less of=20 your total trading capital. So if you
> want
> > = in
>=20 > > on a more volatile stock, just buy less of it...but don't = set the=20 stop
> at
> > > 7-8% if the stock has a 10% daily = trading=20 range - another point HTMMIS
> > > doesn't = address.
> >=20 >
> > > Trading any system with a 7-8% risk for each = trade is=20 a receipe for
> > > disaster. The pros use a 1% limit. = If (as in=20 HTMMIS suggest) you split
> up
> > > your capital = evenly=20 amoung 5-6 stocks and used an arbitrary 7-8% stop
> > = loss,
>=20 > > statistically, it would be very easy to get enough losing = trades=20 to
> loose
> > > all your money. The unspoken 40%=20 reliability of the WON breakouts only
> > makes
> = > >=20 this bad situation worse.
> > >
> > > I'm = afraid=20 that a quick reading of HTMMIS gives the impression that if
>=20 you
> > > can identify the perfect C+H setup and all the = other=20 CANSLIM criteria
> are
> > in
> > > = place, you=20 can get darn near 100% reliability of a breakout. I have a
>=20 big
> > > problem with that.
> > >
> = > >=20 I'm not down on CANSLIM...just like people to know the reality of=20 the
> > > situation. Your going for home runs here and = home run=20 hitters have a lot
> > of
> > > = strikeouts.
>=20 > >
> > >
> > > ERIC TANGEN
> = >=20 >
> > > -----Original Message-----
> > > = From:=20 Katherine Malm [mailto:kmalm@earthlink.net]
> > > Sent:=20 Wednesday, December 12, 2001 2:02 PM
> > > To: canslim@lists.xmission.com=
>=20 > > Subject: Re: [CANSLIM] clarification
> > = >
>=20 > >
> > > >>If you put 7-8% of your trading=20 capital
> > > > at risk on any one trade
> > = >
> > > Now that I've been mulling over your comment, = it begs=20 another question.
> > Are
> > > you suggesting = the=20 *total* monies invested in a trade are "at risk"? Or
> >=20 the
> > > amount which you've specified in downside = stop-loss=20 protection as "at
> > > risk."?
> > = >
> >=20 > Katherine
> > >
> > >
> > > = - -----=20 Original Message -----
> > > From: "Tangen, Eric" <tangene@tycoelectronics.com>
>=20 > > To: <canslim@lists.xmission.com= >
>=20 > > Sent: Wednesday, December 12, 2001 1:46 PM
> > = >=20 Subject: RE: [CANSLIM] clarification
> > >
> >=20 >
> > > > Welcome to the club! Breakouts are a = high risk=20 and high reward
> > strategy -
> > > if
> = >=20 > > you're batting .500, that's pretty darn good. You should = expect=20 40%
> > > success
> > > > at finding = successful=20 breakouts long-term.
> > > >
> > > > I = just=20 have to get this off my chest for the new = subscribers...WON's
> >=20 7-8%
> > > > stop below the pivot is a technical = stop. It is=20 a rule of thumb based
> on
> > > > volatility = in the=20 handle region before a stock takes off.
> > > = >
> >=20 > > It is NOT A MONEY MANAGEMENT STOP!. If you put 7-8% of = your=20 trading
> > > capital
> > > > at risk on = any one=20 trade, you will eventually pay some really serious
> > = Wall
>=20 > > > Street tuition on the path to becoming successful=20 trader.
> > > >
> > > > WON's work has = virtually nothing in the area of money management (what
> > = he
> > > > does say is just plain outdated...by 5 = stocks with=20 100k...more
> > appropriate
> > > > to an = era of=20 high commissions and lower volatility).
> > > = >
> >=20 > > Tharp's books are the best (only?) work in this area and = should=20 be
> > > required
> > > > reading before = you head=20 out to the great casino that is Wall Street.
> > > = >
>=20 > > > ERIC TANGEN
> > >
> > = >
> >=20 >
> > > -
> > > -To = subscribe/unsubscribe, email=20 "majordomo@xmission.com"
>= ;=20 > > -In the email body, write "subscribe canslim" or
> = > >=20 -"unsubscribe canslim".  Do not use quotes in your = email.
> >=20 >
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>= ;=20 > > -In the email body, write "subscribe canslim" or
> = > >=20 -"unsubscribe canslim".  Do not use quotes in your = email.
> >=20 >
> > >
> > > -
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> = > >=20 -"unsubscribe canslim".  Do not use quotes in your = email.
> >=20 >
> > > -
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>=20 >
> >
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