From: owner-canslim-digest@lists.xmission.com (canslim-digest) To: canslim-digest@lists.xmission.com Subject: canslim-digest V2 #2301 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 Sunday, April 14 2002 Volume 02 : Number 2301 In this issue: Re: [CANSLIM] Was that really a recession? Re: [CANSLIM] Bear Rally? [CANSLIM] Fed unsure of recovery strength Re: [CANSLIM] Bear Rally? Re: Screen Capture (was: [CANSLIM] DFXI) RE: [CANSLIM] Bear Rally? Re: [CANSLIM] Bear Rally? Re: [CANSLIM] Bear Rally? ---------------------------------------------------------------------- Date: Sat, 13 Apr 2002 23:09:59 -0400 From: "Tom Worley" Subject: Re: [CANSLIM] Was that really a recession? This is a multi-part message in MIME format. - ------=_NextPart_000_00F3_01C1E340.55C10610 Content-Type: text/plain; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable Robert, I don't take such a pessimistic view, but I do have confidence that my = investments in EPIQ will be reflected in continued growth in bankruptcy = filings. Simply put, consumers have not shown discipline when it comes = to spending, and their use of credit continues to outstrip their growth = in income. Tom Worley stkguru@bellsouth.net AIM: TexWorley - ----- Original Message -----=20 From: Robert McGill=20 To: canslim@lists.xmission.com=20 Sent: Saturday, April 13, 2002 10:45 PM Subject: [CANSLIM] Was that really a recession? http://www.financialsense.com/stormwatch/oldupdates/2002/0412.htm - ------=_NextPart_000_00F3_01C1E340.55C10610 Content-Type: text/html; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable
Robert,
 
I don't take such a pessimistic view, but I do = have=20 confidence that my investments in EPIQ will be reflected in continued = growth in=20 bankruptcy filings. Simply put, consumers have not shown discipline when = it=20 comes to spending, and their use of credit continues to outstrip their = growth in=20 income.
 
Tom Worley
stkguru@bellsouth.net
AIM:=20 TexWorley
----- Original Message -----=20
From: Robert=20 McGill
To: canslim@lists.xmission.com=
Sent: Saturday, April 13, 2002 10:45 PM
Subject: [CANSLIM] Was that really a recession?

http://www.financialsense.com/stormwatch/oldupdates/2002/0412.htm
- ------=_NextPart_000_00F3_01C1E340.55C10610-- - - - -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: Sat, 13 Apr 2002 22:16:14 -0500 From: "Katherine Malm" Subject: Re: [CANSLIM] Bear Rally? This is a multi-part message in MIME format. - ------=_NextPart_000_014E_01C1E338.D354AC60 Content-Type: text/plain; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable Couldn't agree with you more, Ian. Great point. Katherine ----- Original Message -----=20 From: Ian=20 To: canslim@lists.xmission.com=20 Sent: Saturday, April 13, 2002 10:28 PM Subject: Re: [CANSLIM] Bear Rally? "I'll bet the more "mundane" businesses will be the winning stocks for = quite a while." Katherine - I couldn't agree more. However, I think the 'reason' IS = quite exciting: The spread of global democracy and capitalism. The = boring industries that haven't seen growth stocks in the Western world = for quite some time, are going to show robust growth in the developing = world as they build up their core infrastructure while raising their = standard of living. JMHO. We'll see. Ian ----- Original Message -----=20 From: Katherine Malm=20 To: canslim@lists.xmission.com=20 Sent: Saturday, April 13, 2002 12:17 PM Subject: Re: [CANSLIM] Bear Rally? Thanks for the analysis, Patrick. Here's a link to a chart that = shows Sector Rotation during economic cycles. Look toward the bottom of = the page for the current location in the cycle: http://stockcharts.com/charts/performance/SPSectors.html I'm not so sure that technology itself is going to lead for a very = long time. I'll bet the more "mundane" businesses will be the winning = stocks for quite a while. Some of that may be because of the excessive = valuations you mentioned, some of it may be related to taking out excess = capacity through much of the tech sectors. It's hard for me personally, = because I don't get all that excited performing due diligence on = non-tech stocks..... ah well, what doesn't kill us makes us stronger. Katherine ----- Original Message -----=20 From: Patrick Wahl=20 To: canslim@lists.xmission.com=20 Sent: Saturday, April 13, 2002 1:44 PM Subject: Re: [CANSLIM] Bear Rally? On 13 Apr 2002 at 12:35, Duke Miller wrote: > I don't want to start anything, but....since it's the weekend. oh sure.... > So what kind of market are we in, anyway? > =20 I was trying to answer this question the other night, all I could = figure out is that the=20 market is mixed up. Here are some observations, maybe someone can = put things=20 together. Nasdaq selling off after rally to a lower high than the high set = in January. Right now=20 sitting near support set about 2/22, below 50 day MA, which is = sloping down. S&P a little stronger, recent rally carried it just about back to = old highs, it is=20 somewhat above those Feb. lows, support around 1075, also below 50 = day. Dow quite a bit stronger, the recent high surpassed the Jan. = highs, recent selloff not=20 as severe, it's sitting on 50 day MA. Russell 2000 at its highest level since July, made new high on = Friday relative to last=20 8 or 9 months. Vix is up a little bit, off the very low levels it was at, but = still towards the low end of=20 its range (lower means too much optimism, a contrary indicator). = I also notice that=20 the cummulative A/D line for the NYSE has been in a steady uptrend = since Sept.=20 lows, the Nasdaq A/D line has rallied a bit, but for the last 2 = months has gone=20 sideways to lower. Lets see - large caps doing ok in the form of the Dow, small caps = are the strongest=20 group as represented byt the Russell 2000 (that would be our = little universe of=20 canslim stocks), the S&P and Nasdaq, I think you could say the = real guts of the=20 market in terms of broad representation of industries and a large = chunk of the total=20 market cap, are looking flat to weak. Maybe someone can say something about which stocks should be = leading if we are=20 at the beginning of an economic recovery, I'm not sure how to = interepret this stuff,=20 like I said. I think valuations may still be weighing on the = nasdaq, and what I am=20 reading says this will be a weak to moderate recovery, so earnings = may not be=20 storng enough to allow the nasdaq to really get rolling this = year. - -To subscribe/unsubscribe, email "majordomo@xmission.com" -In the email body, write "subscribe canslim" or -"unsubscribe canslim". Do not use quotes in your email. - ------=_NextPart_000_014E_01C1E338.D354AC60 Content-Type: text/html; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable
Couldn't agree with you more, Ian. Great point.
 
 
Katherine
----- Original Message -----
From:=20 Ian =
Sent: Saturday, April 13, 2002 = 10:28=20 PM
Subject: Re: [CANSLIM] Bear = Rally?

"I'll bet the more "mundane" businesses will be = the winning=20 stocks for quite a while."
 
Katherine - I couldn't agree more. However, I = think the=20 'reason' IS quite exciting: The spread of global democracy and = capitalism. The=20 boring industries that haven't seen growth stocks in the Western world = for=20 quite some time, are going to show robust growth in the developing = world as=20 they build up their core infrastructure while raising their standard = of=20 living.
 
JMHO. We'll see.
 
Ian
----- Original Message -----
From:=20 Katherine=20 Malm
Sent: Saturday, April 13, = 2002 12:17=20 PM
Subject: Re: [CANSLIM] Bear=20 Rally?

Thanks for the analysis, Patrick. Here's a link to a chart that = shows=20 Sector Rotation during economic cycles. Look toward the bottom of = the page=20 for the current location in the cycle:
 
http://= stockcharts.com/charts/performance/SPSectors.html
 
I'm not so sure that technology itself is going to lead for a = very long=20 time. I'll bet the more "mundane" businesses will be the winning = stocks for=20 quite a while. Some of that may be because of the excessive = valuations you=20 mentioned, some of it may be related to taking out = excess capacity=20 through much of the tech sectors. It's hard for me personally, = because I=20 don't get all that excited performing due diligence on non-tech = stocks.....=20 ah well, what doesn't kill us makes us stronger.
 
Katherine
----- Original Message ----- =
From:=20 Patrick Wahl=20
To: canslim@lists.xmission.com= =20
Sent: Saturday, April 13, = 2002 1:44=20 PM
Subject: Re: [CANSLIM] Bear = Rally?



On 13 Apr 2002 at 12:35, Duke Miller=20 wrote:

> I don't want to start anything, but....since = it's the=20 weekend.

oh sure....

> So what kind of market are = we in,=20 anyway?
> 

I was trying to answer this question = the=20 other night, all I could figure out is that the
market is = mixed=20 up.  Here are some observations, maybe someone can put things =
together.

Nasdaq selling off after rally to a lower = high than=20 the high set in January.  Right now
sitting near support = set=20 about 2/22, below 50 day MA, which is sloping down.

S&P = a=20 little stronger, recent rally carried it just about back to old = highs, it=20 is
somewhat above those Feb. lows, support around 1075, also = below 50=20 day.

Dow quite a bit stronger, the recent high surpassed = the Jan.=20 highs, recent selloff not
as severe, it's sitting on 50 day=20 MA.

Russell 2000 at its highest level since July, made new = high on=20 Friday relative to last
8 or 9 months.

Vix is up a = little bit,=20 off  the very low levels it was at, but still towards the low = end of=20
its range  (lower means too much optimism, a contrary=20 indicator).  I also notice that
the cummulative A/D line = for the=20 NYSE has been in a steady uptrend since Sept.
lows, the Nasdaq = A/D=20 line has rallied a bit, but for the last 2 months has gone =
sideways to=20 lower.

Lets see - large caps doing ok in the form of the = Dow, small=20 caps are the strongest
group as represented byt the Russell = 2000 (that=20 would be our little universe of
canslim stocks), the S&P = and=20 Nasdaq, I think you could say the real guts of the
market in = terms of=20 broad representation of industries and a large chunk of the total=20
market cap, are looking flat to weak.

Maybe someone can = say=20 something about which stocks should be leading if we are
at = the=20 beginning of an economic recovery, I'm not sure how to interepret = this=20 stuff,
like I said.   I think valuations may still = be=20 weighing on the nasdaq, and what I am
reading says this will = be a weak=20 to moderate recovery, so earnings may not be
storng enough to = allow=20 the nasdaq  to really get rolling this=20 year.





-
-To subscribe/unsubscribe, email = "majordomo@xmission.com"
-In= =20 the email body, write "subscribe canslim" or
-"unsubscribe=20 canslim".  Do not use quotes in your=20 email.
- ------=_NextPart_000_014E_01C1E338.D354AC60-- - - - -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: Sat, 13 Apr 2002 23:35:05 -0400 From: "Robert McGill" Subject: [CANSLIM] Fed unsure of recovery strength This is a multi-part message in MIME format. - ------=_NextPart_000_001A_01C1E343.D773D090 Content-Type: text/plain; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable http://story.news.yahoo.com/news?tmpl=3Dstory&cid=3D580&ncid=3D749&e=3D4&= u=3D/nm/20020411/bs_nm/economy_fed_dc_25 - ------=_NextPart_000_001A_01C1E343.D773D090 Content-Type: text/html; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable
http://= story.news.yahoo.com/news?tmpl=3Dstory&cid=3D580&ncid=3D749&e= =3D4&u=3D/nm/20020411/bs_nm/economy_fed_dc_25
= - ------=_NextPart_000_001A_01C1E343.D773D090-- - - - -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: Sun, 14 Apr 2002 01:15:17 EDT From: Spencer48@aol.com Subject: Re: [CANSLIM] Bear Rally? Katherine and Duke: In today's Investor's Corner (4/15) the column focuses on the fact that small caps are doing well while the big caps are lagging. This approach is interesting. Apparently one should look at: The Mkts ->The Industry -> The Capitalization (whether the stock is a big cap or a small cap makes a difference, according to the article, regarding the probability that the stock will take off. If small caps are currently being favored than investing in big caps is less likely to garner a winner.) - -> (and finally) The Stock. So it looks as if one should go through the above checklist to find a stock that will be a winner. (Apropos, I wonder if anyone has compared the industry [I know CANSLIM uses a Strong Industry as a necessary forerunner of a strong stock] with the favored capitalization at the time. For instance, if XYZ industry is the industry that CANSLIM/WON favors at the present, would the capitalization of the stock that is in that industry make a significant difference as to its return, ie. do the statistics confirm that not only the industry, but also the capitalization of the stock in that industry, is a big factor in the movement up of that stock? ) jans In a message dated 4/13/2002 12:50:16 PM Eastern Daylight Time, kmalm@earthlink.net writes: << MessageHi Duke, I read the article and thought the same thing. I think the real issue is that when all stocks are not in a Bull Market, you can't talk meaningfully about "THE Market" any longer. For example, the last couple of years of "the great Bull", the Dow ran sideways while the NASDAQ screamed. The article today only reinforces that notion. That is, some stocks are going up, others are going down, others are moving sideways. That's always the case, but when equities aren't the absolute best place to put your money for "sure" gains, the marginal dollars will flow to other investment classes and the rest of the market will ebb and flow. If nothing else, it just reminds us as CANSLIM investors that we have to pick only the best candidates and follow sound buy/sell rules. I don't think there's going to be a clear direction for "the Market" as a whole for many years. We're going to have to read the health of the CANSLIM market (i.e. CANSLIM-quality stocks) and then go for strength within that. Katherine PS.... The term "rally" is used in many contexts, even within the IBD and Investors.com. Is it an upswing? Is it action after a followthru day? Is it a Bull? How persistent does an upswing need to be before it's no longer considered "a rally"? Rally relative to what? relative to when? Geez....very confusing terminology. >> - - - -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: Sun, 14 Apr 2002 05:33:32 -0700 (PDT) From: Dimitri Katsaros Subject: Re: Screen Capture (was: [CANSLIM] DFXI) Katherine, My apologies. Dimitri - --- Katherine Malm wrote: > Hi Dimitri, > > I was referring graphic after it had been annotated > in Word. > > Katherine ===== Quiquid latine dictum sit altum viditur __________________________________________________ Do You Yahoo!? Yahoo! Tax Center - online filing with TurboTax http://taxes.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. ------------------------------ Date: Sun, 14 Apr 2002 09:55:15 -0400 From: "Duke Miller" Subject: RE: [CANSLIM] Bear Rally? Jans: Good thinking and input for the neighborhood. Can you say "CANSLICM?" Not long ago we debated herein the capitalization definitions. Do you suppose their (IBD's) definitions in the IC (<=1bb is small; >=5bb is large; mid in between) conform to the S&P 600 (Small), 400 (mid), and 500 (big)? Duke - -----Original Message----- From: owner-canslim@lists.xmission.com [mailto:owner-canslim@lists.xmission.com] On Behalf Of Spencer48@aol.com Sent: Sunday, April 14, 2002 1:15 AM To: canslim@lists.xmission.com Subject: Re: [CANSLIM] Bear Rally? Katherine and Duke: In today's Investor's Corner (4/15) the column focuses on the fact that small caps are doing well while the big caps are lagging. This approach is interesting. Apparently one should look at: The Mkts ->The Industry -> The Capitalization (whether the stock is a big cap or a small cap makes a difference, according to the article, regarding the probability that the stock will take off. If small caps are currently being favored than investing in big caps is less likely to garner a winner.) - -> (and finally) The Stock. So it looks as if one should go through the above checklist to find a stock that will be a winner. (Apropos, I wonder if anyone has compared the industry [I know CANSLIM uses a Strong Industry as a necessary forerunner of a strong stock] with the favored capitalization at the time. For instance, if XYZ industry is the industry that CANSLIM/WON favors at the present, would the capitalization of the stock that is in that industry make a significant difference as to its return, ie. do the statistics confirm that not only the industry, but also the capitalization of the stock in that industry, is a big factor in the movement up of that stock? ) jans In a message dated 4/13/2002 12:50:16 PM Eastern Daylight Time, kmalm@earthlink.net writes: << MessageHi Duke, I read the article and thought the same thing. I think the real issue is that when all stocks are not in a Bull Market, you can't talk meaningfully about "THE Market" any longer. For example, the last couple of years of "the great Bull", the Dow ran sideways while the NASDAQ screamed. The article today only reinforces that notion. That is, some stocks are going up, others are going down, others are moving sideways. That's always the case, but when equities aren't the absolute best place to put your money for "sure" gains, the marginal dollars will flow to other investment classes and the rest of the market will ebb and flow. If nothing else, it just reminds us as CANSLIM investors that we have to pick only the best candidates and follow sound buy/sell rules. I don't think there's going to be a clear direction for "the Market" as a whole for many years. We're going to have to read the health of the CANSLIM market (i.e. CANSLIM-quality stocks) and then go for strength within that. Katherine PS.... The term "rally" is used in many contexts, even within the IBD and Investors.com. Is it an upswing? Is it action after a followthru day? Is it a Bull? How persistent does an upswing need to be before it's no longer considered "a rally"? Rally relative to what? relative to when? Geez....very confusing terminology. >> - - - -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: Sun, 14 Apr 2002 10:20:10 -0400 From: "Tom Worley" Subject: Re: [CANSLIM] Bear Rally? Duke, We don't need a new letter, we already have "S". Of course, over the years WON has redefined this letter. In my first edition of HTMMIS, this letter was defined as "S=Supply and Demand: Small Capitalization Plus Volume Demand" and WON indicated that you should look for a company with only a few million shares outstanding. He also favored "Stocks that have a large percentage of ownership by top management are generally your better prospects". He also noted that the "average capitalization of top performing listed stocks from 1970 through 1982 was 11.8 million shares. The median stock exhibited 4.6 million shares outstanding before advancing rapidly in price." Of course, a lot has changed since my copy was published in 1991, and I doubt either WON or IBD today would champion small cap stocks, much less ones this small. WON went over to the big cap camp over five years ago, and I have seen little evidence of him adhering to the "S" since then. Tom Worley stkguru@bellsouth.net AIM: TexWorley - ----- Original Message ----- From: "Duke Miller" To: Sent: Sunday, April 14, 2002 9:55 AM Subject: RE: [CANSLIM] Bear Rally? Jans: Good thinking and input for the neighborhood. Can you say "CANSLICM?" Not long ago we debated herein the capitalization definitions. Do you suppose their (IBD's) definitions in the IC (<=1bb is small; >=5bb is large; mid in between) conform to the S&P 600 (Small), 400 (mid), and 500 (big)? Duke - -----Original Message----- From: owner-canslim@lists.xmission.com [mailto:owner-canslim@lists.xmission.com] On Behalf Of Spencer48@aol.com Sent: Sunday, April 14, 2002 1:15 AM To: canslim@lists.xmission.com Subject: Re: [CANSLIM] Bear Rally? Katherine and Duke: In today's Investor's Corner (4/15) the column focuses on the fact that small caps are doing well while the big caps are lagging. This approach is interesting. Apparently one should look at: The Mkts ->The Industry -> The Capitalization (whether the stock is a big cap or a small cap makes a difference, according to the article, regarding the probability that the stock will take off. If small caps are currently being favored than investing in big caps is less likely to garner a winner.) - -> (and finally) The Stock. So it looks as if one should go through the above checklist to find a stock that will be a winner. (Apropos, I wonder if anyone has compared the industry [I know CANSLIM uses a Strong Industry as a necessary forerunner of a strong stock] with the favored capitalization at the time. For instance, if XYZ industry is the industry that CANSLIM/WON favors at the present, would the capitalization of the stock that is in that industry make a significant difference as to its return, ie. do the statistics confirm that not only the industry, but also the capitalization of the stock in that industry, is a big factor in the movement up of that stock? ) jans In a message dated 4/13/2002 12:50:16 PM Eastern Daylight Time, kmalm@earthlink.net writes: << MessageHi Duke, I read the article and thought the same thing. I think the real issue is that when all stocks are not in a Bull Market, you can't talk meaningfully about "THE Market" any longer. For example, the last couple of years of "the great Bull", the Dow ran sideways while the NASDAQ screamed. The article today only reinforces that notion. That is, some stocks are going up, others are going down, others are moving sideways. That's always the case, but when equities aren't the absolute best place to put your money for "sure" gains, the marginal dollars will flow to other investment classes and the rest of the market will ebb and flow. If nothing else, it just reminds us as CANSLIM investors that we have to pick only the best candidates and follow sound buy/sell rules. I don't think there's going to be a clear direction for "the Market" as a whole for many years. We're going to have to read the health of the CANSLIM market (i.e. CANSLIM-quality stocks) and then go for strength within that. Katherine PS.... The term "rally" is used in many contexts, even within the IBD and Investors.com. Is it an upswing? Is it action after a followthru day? Is it a Bull? How persistent does an upswing need to be before it's no longer considered "a rally"? Rally relative to what? relative to when? Geez....very confusing terminology. >> - - - -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: Sun, 14 Apr 2002 09:44:11 -0500 From: "Katherine Malm" Subject: Re: [CANSLIM] Bear Rally? This is a multi-part message in MIME format. - ------=_NextPart_000_018F_01C1E398.EDFB7B60 Content-Type: text/plain; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable Duke, Tom, jans, I'll bet the small to large cap migration has more to do with the length = of the Secular Bull than anything else. In the early stages of a new = Bull market, small caps (especially those with high growth = characteristics) lead the market. It makes intuitive sense. As the bull = wears on, those "small caps" become "big caps" as more and more money = is drawn to the stock. It's the very thing that CANSLIM is looking for = in the "I"...that is, you watch for evidence of institutional monies = moving into the stock and then just follow their lead. Once the stocks = put in their 3rd and 4th stage bases, everybody knows about them and = their market caps are quite large in comparison to where they were when = they blew out of their first stage bases. Nearly every high flier late = in '98 and '99 was a late stage base. Only those companies that have the = wherewithal to survive as a business and expand their markets will set = up new first stage bases. Non-CANSLIMers are still chasing AOL, DELL, = CSCO, etc., all former winners and all large caps due to their huge runs = in the 90's. CANSLIMers know better....go to strength, regardless of = market cap. It just so happens small and mid-cap are leading right now = and that is one more piece of evidence for the "emerging new bull" point = of view. Katherine ----- Original Message -----=20 From: Tom Worley=20 To: canslim@lists.xmission.com=20 Sent: Sunday, April 14, 2002 9:20 AM Subject: Re: [CANSLIM] Bear Rally? Duke, We don't need a new letter, we already have "S". Of course, over the = years WON has redefined this letter. In my first edition of HTMMIS, this = letter was defined as "S=3DSupply and Demand: Small Capitalization Plus = Volume Demand" and WON indicated that you should look for a company with only = a few million shares outstanding. He also favored "Stocks that have a large percentage of ownership by top management are generally your better prospects". He also noted that the "average capitalization of top = performing listed stocks from 1970 through 1982 was 11.8 million shares. The = median stock exhibited 4.6 million shares outstanding before advancing = rapidly in price." Of course, a lot has changed since my copy was published in 1991, and = I doubt either WON or IBD today would champion small cap stocks, much = less ones this small. WON went over to the big cap camp over five years = ago, and I have seen little evidence of him adhering to the "S" since then. Tom Worley stkguru@bellsouth.net AIM: TexWorley ----- Original Message ----- From: "Duke Miller" To: Sent: Sunday, April 14, 2002 9:55 AM Subject: RE: [CANSLIM] Bear Rally? Jans: Good thinking and input for the neighborhood. Can you say "CANSLICM?" Not long ago we debated herein the capitalization definitions. Do you suppose their (IBD's) definitions in the IC (<=3D1bb is small; >=3D5bb = is large; mid in between) conform to the S&P 600 (Small), 400 (mid), and 500 (big)? Duke -----Original Message----- From: owner-canslim@lists.xmission.com [mailto:owner-canslim@lists.xmission.com] On Behalf Of = Spencer48@aol.com Sent: Sunday, April 14, 2002 1:15 AM To: canslim@lists.xmission.com Subject: Re: [CANSLIM] Bear Rally? Katherine and Duke: In today's Investor's Corner (4/15) the column focuses on the = fact that small caps are doing well while the big caps are lagging. This = approach is interesting. Apparently one should look at: The Mkts ->The Industry = - -> The Capitalization (whether the stock is a big cap or a small cap makes a difference, according to the article, regarding the probability that = the stock will take off. If small caps are currently being favored than investing in big caps is less likely to garner a winner.) -> (and finally) The Stock. So it looks as if one should go through the above checklist to = find a stock that will be a winner. (Apropos, I wonder if anyone has = compared the industry [I know CANSLIM uses a Strong Industry as a necessary forerunner of a strong stock] with the favored capitalization at the time. For instance, if XYZ industry is the industry that CANSLIM/WON favors at the present, would the capitalization of the stock that is in that industry make a significant difference as to its return, ie. do the statistics confirm that not only the industry, but also the capitalization of the stock = in that industry, is a big factor in the movement up of that stock? ) jans In a message dated 4/13/2002 12:50:16 PM Eastern Daylight Time, kmalm@earthlink.net writes: << MessageHi Duke, I read the article and thought the same thing. I think the real issue is that when all stocks are not in a Bull Market, you can't talk meaningfully about "THE Market" any longer. For example, the last couple of years = of "the great Bull", the Dow ran sideways while the NASDAQ screamed. The = article today only reinforces that notion. That is, some stocks are going up, others are going down, others are moving sideways. That's always the case, = but when equities aren't the absolute best place to put your money for "sure" gains, the marginal dollars will flow to other investment classes and the = rest of the market will ebb and flow. If nothing else, it just reminds us as CANSLIM investors that we have to pick only the best candidates and follow = sound buy/sell rules. I don't think there's going to be a clear direction = for "the Market" as a whole for many years. We're going to have to read the health of the CANSLIM market (i.e. CANSLIM-quality stocks) and then go for strength within that. Katherine PS.... The term "rally" is used in many contexts, even within the IBD and Investors.com. Is it an upswing? Is it action after a followthru day? = Is it a Bull? How persistent does an upswing need to be before it's no longer considered "a rally"? Rally relative to what? relative to when? Geez....very confusing terminology. >> - ------=_NextPart_000_018F_01C1E398.EDFB7B60 Content-Type: text/html; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable
Duke, Tom, jans,
 
I'll bet the small to large cap migration has more to do with the = length of=20 the Secular Bull than anything else. In the early stages of a new Bull = market,=20 small caps (especially those with high growth characteristics) lead the = market.=20 It makes intuitive sense. As the bull wears on, those "small caps"  = become=20 "big caps" as more and more money is drawn to the stock. It's the very = thing=20 that CANSLIM is looking for in the "I"...that is, you watch for evidence = of=20 institutional monies moving into the stock and then just follow their = lead. Once=20 the stocks put in their 3rd and 4th stage bases, everybody knows about = them and=20 their market caps are quite large in comparison to where they were when = they=20 blew out of their first stage bases. Nearly every high flier late in '98 = and '99=20 was a late stage base. Only those companies that have the = wherewithal  to=20 survive as a business and expand their markets will set up new = first stage=20 bases.  Non-CANSLIMers are still chasing AOL, DELL, CSCO, = etc., all=20 former winners and all large caps due to their huge runs in the 90's. = CANSLIMers=20 know better....go to strength, regardless of market cap. It just so = happens=20 small and mid-cap are leading right now and that is one more piece of = evidence=20 for the "emerging new bull" point of view.
 
Katherine
----- Original Message -----
From:=20 Tom=20 Worley
Sent: Sunday, April 14, 2002 = 9:20=20 AM
Subject: Re: [CANSLIM] Bear = Rally?

Duke,

We don't need a new letter, we already = have "S".=20 Of course, over the years
WON has redefined this letter. In my = first=20 edition of HTMMIS, this letter
was defined as "S=3DSupply and = Demand: Small=20 Capitalization Plus Volume
Demand" and WON indicated that you = should look=20 for a company with only a few
million shares outstanding. He also = favored=20 "Stocks that have a large
percentage of ownership by top management = are=20 generally your better
prospects". He also noted that the "average=20 capitalization of top performing
listed stocks from 1970 through = 1982 was=20 11.8 million shares. The median
stock exhibited 4.6 million shares=20 outstanding before advancing rapidly in
price."

Of course, a = lot has=20 changed since my copy was published in 1991, and I
doubt either WON = or IBD=20 today would champion small cap stocks, much less
ones this small. = WON went=20 over to the big cap camp over five years ago, and
I have seen = little=20 evidence of him adhering to the "S" since then.

Tom = Worley
stkguru@bellsouth.net
AIM:=20 TexWorley
----- Original Message -----
From: "Duke Miller" = <dukemill@tampabay.rr.com>=
To:=20 <canslim@lists.xmission.com= >
Sent:=20 Sunday, April 14, 2002 9:55 AM
Subject: RE: [CANSLIM] Bear=20 Rally?


Jans:

Good thinking and input for the = neighborhood.=20 Can you say "CANSLICM?"

Not long ago we debated herein the=20 capitalization definitions.  Do you
suppose their (IBD's) = definitions=20 in the IC (<=3D1bb is small; >=3D5bb is
large; mid in = between) conform to=20 the S&P 600 (Small), 400 (mid), and
500=20 (big)?

Duke

-----Original Message-----
From: owner-canslim@lists.xmis= sion.com
[mailto:owner-canslim@lists.xmission.com]=20 On Behalf Of Spencer48@aol.com
Sent:=20 Sunday, April 14, 2002 1:15 AM
To: canslim@lists.xmission.com=
Subject:=20 Re: [CANSLIM] Bear Rally?


Katherine and=20 Duke:

     In today's Investor's Corner = (4/15) the=20 column focuses on the fact
that
small caps are doing well while = the big=20 caps are lagging.  This approach
is
interesting.  = Apparently=20 one should look at:  The Mkts ->The Industry=20 ->
The
Capitalization (whether the stock is a big cap or a = small cap=20 makes a
difference, according to the article, regarding the = probability=20 that the

stock will take off.  If small caps are = currently =20 being favored than
investing in big caps is less likely to garner a = winner.)
-> (and finally) The = Stock.

     So=20 it looks as if one should go through the above checklist to = find
a
stock=20 that will be a winner.  (Apropos, I wonder if anyone has=20 compared
the
industry [I know CANSLIM uses a Strong Industry as = a=20 necessary
forerunner of
a strong stock] with the favored = capitalization=20 at the time.

     For instance, if XYZ = industry is=20 the industry that CANSLIM/WON
favors at
the present, would the=20 capitalization  of the stock that is in that
industry
make = a=20 significant difference as to its return, ie. do the=20 statistics
confirm
that not only the industry, but also the=20 capitalization of the stock in
that
industry, is a big factor in = the=20 movement up of that stock? )

jans



In a message = dated=20 4/13/2002 12:50:16 PM Eastern Daylight Time,
kmalm@earthlink.net=20 writes:

<< MessageHi Duke,

 I read the = article and=20 thought the same thing. I think the real issue
is
that when all = stocks=20 are not in a Bull Market, you can't talk
meaningfully
about "THE = Market"=20 any longer. For example, the last couple of years of
"the
great = Bull",=20 the Dow ran sideways while the NASDAQ screamed. The = article

today only=20 reinforces that notion. That is, some stocks are going = up,
others
are=20 going down, others are moving sideways. That's always the case,=20 but
when
equities aren't the absolute best place to put your = money for=20 "sure"
gains,
the marginal dollars will flow to other investment = classes=20 and the rest
of
the market will ebb and flow. If nothing else, = it just=20 reminds us as
CANSLIM
investors that we have to pick only the = best=20 candidates and follow sound

buy/sell rules. I don't think = there's going=20 to be a clear direction for
"the
Market" as a whole for many = years.=20 We're going to have to read the
health of
the CANSLIM market = (i.e.=20 CANSLIM-quality stocks) and then go for
strength
within=20 that.

 Katherine

 PS.... The term "rally" is = used in=20 many contexts, even within the IBD
and
Investors.com. Is it an = upswing?=20 Is it action after a followthru day? Is
it a
Bull? How = persistent does=20 an upswing need to be before it's no longer
considered "a rally"? = Rally=20 relative to what? relative to when?
Geez....very
confusing = terminology.=20 >> - ------=_NextPart_000_018F_01C1E398.EDFB7B60-- - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email. ------------------------------ End of canslim-digest V2 #2301 ****************************** To unsubscribe to canslim-digest, send an email to "majordomo@xmission.com" with "unsubscribe canslim-digest" in the body of the message. For information on digests or retrieving files and old messages send "help" to the same address. Do not use quotes in your message.