From: owner-canslim-digest@lists.xmission.com (canslim-digest) To: canslim-digest@lists.xmission.com Subject: canslim-digest V2 #2304 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 2304 In this issue: Re: [CANSLIM] Bear Rally? Re: [CANSLIM] Bear Rally? Re: [CANSLIM] Bear Rally? ---------------------------------------------------------------------- Date: Sun, 14 Apr 2002 12:42:34 -0400 From: "Ira Post" Subject: Re: [CANSLIM] Bear Rally? This is a multi-part message in MIME format. - ------=_NextPart_000_0019_01C1E3B1.D9FDF3E0 Content-Type: text/plain; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable Mona and Katherine, Very good points on market direction. We'd all love to have another = bull market, but we haven't sufficiently absorbed the last one. P/E's = are still very high. I think a sideways move for a number of years is a = very likely transition to whatever comes next. I also agree that tech = stocks will recover somewhat, but not lead the market like they did in = the nineties. Tech stocks are often like Hostess Twinkies. They're so attractive, but = usually lack substance. One has to be very careful to use good due = diligence on the financials on tech stocks like on every other stock. Ira ----- Original Message -----=20 From: Katherine Malm=20 To: canslim@lists.xmission.com=20 Sent: Sunday, April 14, 2002 12:10 PM Subject: Re: [CANSLIM] Bear Rally? Hi Mona, Some comments on your points-- 1. I've always believed that the same steps in due diligence have to = be taken on all stocks, regardless of the business, and I do this = without exception. I look at it as the difference between reading an = instruction manual and a good book. Both have value, one I plod through, = the other I fly through. 2. Agreed that little economic progress can be made without = technological innovation, and this will continue to drive economic = growth. However, the era of "all tech all the time" is over. Tech will = continue to innovate, but the market will not necessarily be dominated = by tech names in the same way it was in the last Bull. It's innovation = in general that garners market winners. That innovation can take many = forms from tech, to business market redefinition, new applications for = existing technologies, etc. 3. Pull out a chart of the market from the mid 1960's to about 1982. = *That's* a sideways market. (You can see the same thing in the market = after the crash of 1929. That sideways market went on until about 1949) = Within a sideways market there are winners and losers, up and down = waves, but the market as a whole from the beginning of the cycle to the = end is for the most part flat. Exploiting sector rotation with the = strongest stocks is key to successfully investing in such a market. Katherine ----- Original Message -----=20 From: Mona Guarino=20 To: canslim@lists.xmission.com=20 Sent: Sunday, April 14, 2002 1:52 PM Subject: RE: [CANSLIM] Bear Rally? Katherine --=20 1. on the one hand, due diligence on non-tech stocks may not be as = exciting for the tech-minded among us, but as a newbie to the CANSLIM = principles, I am finding that it forces me to stay focused on the = investing process and I don't get as distracted by excitement of the the = technology itself. For me, not a bad thing at the moment to have my = focus enforced. 2. I agree that tech is very unlikely to lead as it did before. But, = I don't see intuitively how any overall improvement in the market can = occur without at least improving tech's current position. How does = anyone to it cheaper / better / faster without an effect on tech? 3. In various messages, you seem to indicate that you believe the = current directionlessness of the market will continue for years. = Definietly think that that's where we are now and that it's not going to = change in the next quarter or two, but wonder what suggests it will be = many more years of this. -- Mona - ------=_NextPart_000_0019_01C1E3B1.D9FDF3E0 Content-Type: text/html; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable
Mona and Katherine,
 
Very good points on market = direction.  We'd=20 all love to have another bull market, but we haven't sufficiently = absorbed the=20 last one.  P/E's are still very high.  I think a sideways move = for a=20 number of years is a very likely transition to whatever comes = next.  I also=20 agree that tech stocks will recover somewhat, but not lead the market = like they=20 did in the nineties.
 
Tech stocks are often like Hostess = Twinkies. =20 They're so attractive, but usually lack substance.  One has to be = very=20 careful to use good due diligence on the financials on tech stocks like = on every=20 other stock.
 
Ira
----- Original Message -----
From:=20 Katherine=20 Malm
To: canslim@lists.xmission.com=
Sent: Sunday, April 14, 2002 = 12:10=20 PM
Subject: Re: [CANSLIM] Bear = Rally?

Hi Mona,
 
Some comments on your points--
 
1. I've always believed that the same steps in due diligence have = to be=20 taken on all stocks, regardless of the business, and I do this without = exception. I look at it as the difference between reading an = instruction=20 manual and a good book. Both have value, one I plod through, the other = I fly=20 through.
 
2. Agreed that little economic progress can be made without = technological=20 innovation, and this will continue to drive economic growth. However, = the era=20 of "all tech all the time" is over. Tech will continue to innovate, = but the=20 market will not necessarily be dominated by tech names in the same way = it was=20 in the last Bull. It's innovation in general that garners market = winners. That=20 innovation can take many forms from tech, to business market = redefinition, new=20 applications for existing technologies, etc.
 
3. Pull out a chart of the market from the mid 1960's to about = 1982.=20 *That's* a sideways market. (You can see the same thing in the market = after=20 the crash of 1929. That sideways market went on until about 1949) = Within a=20 sideways market there are winners and losers, up and down waves, but = the=20 market as a whole from the beginning of the cycle to the end is for = the most=20 part flat. Exploiting sector rotation with the strongest = stocks is key to=20 successfully investing in such a market.
 
Katherine
----- Original Message -----
From:=20 Mona=20 Guarino
Sent: Sunday, April 14, 2002 = 1:52=20 PM
Subject: RE: [CANSLIM] Bear=20 Rally?

Katherine --
 
1.=20 on the one hand, due diligence on non-tech stocks may not be as = exciting for=20 the tech-minded among us, but as a newbie to the CANSLIM principles, = I am=20 finding that it forces me to stay focused on the investing process = and I=20 don't get as distracted by excitement of the the technology itself. = For me,=20 not a bad thing at the moment to have my focus = enforced.
 
2.=20 I agree that tech is very unlikely to lead as it did before. But, I = don't=20 see intuitively how any overall improvement in the market can occur = without=20 at least improving tech's current position. How does anyone to it = cheaper /=20 better / faster without an effect on tech?
 
3. In various messages, you seem to = indicate=20 that you believe the current directionlessness of the market will = continue=20 for years. Definietly think that that's where we are now and that = it's not=20 going to change in the next quarter or two, but wonder what suggests = it will=20 be many more years of this.
 
--=20 Mona
- ------=_NextPart_000_0019_01C1E3B1.D9FDF3E0-- - - - -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 12:40:55 -0400 From: "Robert McGill" Subject: Re: [CANSLIM] Bear Rally? This is a multi-part message in MIME format. - ------=_NextPart_000_001E_01C1E3B1.9EDE2640 Content-Type: text/plain; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable You are certainly entitled to your opinion. -- Original Message -----=20 From: Katherine Malm=20 To: canslim@lists.xmission.com=20 Sent: Sunday, April 14, 2002 12:35 PM Subject: Re: [CANSLIM] Bear Rally? Robert, That was not the point of the discussion. While I am not going to = dispute the returns on precious metals, it is not the charter of this = group to discuss commodities. Your insistence on turning every = discussion into a reference to gold stocks is bordering on touting and I = believe inappropriate for list discussion. Katherine ----- Original Message -----=20 From: Robert McGill=20 To: canslim@lists.xmission.com=20 Sent: Sunday, April 14, 2002 11:30 AM Subject: Re: [CANSLIM] Bear Rally? Those are certainly incredible returns with etf's. How do they = stack up against precious metals? ----- Original Message -----=20 From: Katherine Malm=20 To: canslim@lists.xmission.com=20 Sent: Sunday, April 14, 2002 11:25 AM Subject: Re: [CANSLIM] Bear Rally? Robert, While Small Cap Value is leading, the small cap growth, mid cap = growth, mid cap value are also very strong and posting similar results. = All of them are dwarfing large cap value and growth. Since the most recent market bottom 9/21, here are the returns = using the ETF's as proxy: Small Cap Growth: +34.78% Mid Cap Growth: + 33.5% Small Cap Value: + 45.35% Mid Cap Value: + 34.8% Certainly nothing to sneeze at. See a chart at: = http://stockcharts.com/webcgi/wb.exe?Perf.web+ijt,ijk,iwf,ijs,ijj,ive Katherine ----- Original Message -----=20 From: Robert McGill=20 To: canslim@lists.xmission.com=20 Sent: Sunday, April 14, 2002 10:07 AM Subject: Re: [CANSLIM] Bear Rally? I think that when discussing small cap it is impt to make a = distinction between growth and value. Value is currently leading. ----- Original Message -----=20 From: Katherine Malm=20 To: canslim@lists.xmission.com=20 Sent: Sunday, April 14, 2002 10:44 AM Subject: Re: [CANSLIM] Bear Rally? 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_001E_01C1E3B1.9EDE2640 Content-Type: text/html; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable
You are certainly entitled to your=20 opinion.  -- Original Message -----
From:=20 Katherine=20 Malm
Sent: Sunday, April 14, 2002 = 12:35=20 PM
Subject: Re: [CANSLIM] Bear = Rally?

Robert,
 
That was not the point of the discussion.  While I am = not going=20 to dispute the returns on precious metals, it is not the charter of = this group=20 to discuss commodities. Your insistence on turning every discussion = into a=20 reference to gold stocks is bordering on touting and I believe = inappropriate=20 for list discussion.
 
Katherine
----- Original Message -----
From:=20 Robert=20 McGill
Sent: Sunday, April 14, 2002 = 11:30=20 AM
Subject: Re: [CANSLIM] Bear=20 Rally?

Those are certainly incredible = returns with=20 etf's.  How do they stack up against precious = metals?
----- Original Message ----- =
From:=20 Katherine=20 Malm
To: canslim@lists.xmission.com= =20
Sent: Sunday, April 14, = 2002 11:25=20 AM
Subject: Re: [CANSLIM] Bear = Rally?

Robert,
 
While Small Cap Value is leading, the small cap growth, mid = cap=20 growth, mid cap value are also very strong and posting similar = results.=20 All of them are dwarfing large cap value and growth.
 
Since the most recent market bottom 9/21, here are the = returns using=20 the ETF's as proxy:
Small Cap Growth: +34.78%
Mid Cap Growth: + 33.5%
Small Cap Value: + 45.35%
Mid Cap Value: + 34.8%
 
Certainly nothing to sneeze at.
 
See a chart at:
http://stockcharts.com/webcgi/wb.exe?Perf.web+ijt,ijk,iwf,ijs,ijj,i= ve
 
Katherine
----- Original Message ----- =
From:=20 Robert McGill
To: canslim@lists.xmission.com= =20
Sent: Sunday, April 14, = 2002 10:07=20 AM
Subject: Re: [CANSLIM] = Bear=20 Rally?

I think that when discussing = small cap it=20 is impt to make a distinction between growth and value.  = Value is=20 currently leading.
----- Original Message ----- =
From:=20 Katherine Malm
To: canslim@lists.xmission.com= =20
Sent: Sunday, April 14, = 2002=20 10:44 AM
Subject: Re: [CANSLIM] = Bear=20 Rally?

Duke, Tom, jans,
 
I'll bet the small to large cap migration has more to do = with the=20 length of the Secular Bull than anything else. In the early = stages of=20 a new Bull market, small caps (especially those with high = growth=20 characteristics) lead the market. It makes intuitive sense. As = the=20 bull wears on, those "small caps"  become "big caps" as = more and=20 more money is drawn to the stock. It's the very thing that = CANSLIM is=20 looking for in the "I"...that is, you watch for evidence of=20 institutional monies moving into the stock and then just = follow their=20 lead. Once the stocks put in their 3rd and 4th stage bases, = everybody=20 knows about them and their market caps are quite large in = comparison=20 to where they were when they blew out of their first stage = bases.=20 Nearly every high flier late in '98 and '99 was a late stage = base.=20 Only those companies that have the wherewithal  to = survive as a=20 business and expand their markets will set up new first = stage=20 bases.  Non-CANSLIMers are still chasing AOL, DELL, = CSCO,=20 etc., all former winners and all large caps due to their huge = runs in=20 the 90's. CANSLIMers know better....go to strength, regardless = of=20 market cap. It just so happens small and mid-cap are leading = right now=20 and that is one more piece of evidence for the "emerging = new=20 bull" point of view.
 
Katherine
----- Original Message ----- =
From:=20 Tom Worley
To: canslim@lists.xmission.com= =20
Sent: Sunday, April = 14, 2002=20 9:20 AM
Subject: Re: = [CANSLIM] Bear=20 Rally?

Duke,

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

Of course, a lot has changed since my = copy was=20 published in 1991, and I
doubt either WON or IBD today = would=20 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=20 little evidence of him adhering to the "S" since = then.

Tom=20 Worley
stkguru@bellsouth.net
AIM:=20 TexWorley
----- Original Message -----
From: "Duke = Miller"=20 <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=20 neighborhood. Can you say "CANSLICM?"

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

Duke

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

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

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

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

jans



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

<< MessageHi Duke,

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

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

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

 Katherine

 PS.... The term = "rally" is=20 used in many contexts, even within the = IBD
and
Investors.com.=20 Is it an upswing? Is it action after a followthru day? = Is
it=20 a
Bull? How persistent does an upswing need to be before = it's no=20 longer
considered "a rally"? Rally relative to what? = relative to=20 when?
Geez....very
confusing terminology.=20 = >>
= - ------=_NextPart_000_001E_01C1E3B1.9EDE2640-- - - - -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 12:43:35 -0400 From: "Tom Worley" Subject: Re: [CANSLIM] Bear Rally? This is a multi-part message in MIME format. - ------=_NextPart_000_038D_01C1E3B1.FE6987D0 Content-Type: text/plain; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable well said, Katherine.=20 Tom Worley stkguru@bellsouth.net AIM: TexWorley - ----- Original Message -----=20 From: Katherine Malm=20 To: canslim@lists.xmission.com=20 Sent: Sunday, April 14, 2002 12:35 PM Subject: Re: [CANSLIM] Bear Rally? Robert, That was not the point of the discussion. While I am not going to = dispute the returns on precious metals, it is not the charter of this = group to discuss commodities. Your insistence on turning every = discussion into a reference to gold stocks is bordering on touting and I = believe inappropriate for list discussion. Katherine ----- Original Message -----=20 From: Robert McGill=20 To: canslim@lists.xmission.com=20 Sent: Sunday, April 14, 2002 11:30 AM Subject: Re: [CANSLIM] Bear Rally? Those are certainly incredible returns with etf's. How do they stack = up against precious metals? ----- Original Message -----=20 From: Katherine Malm=20 To: canslim@lists.xmission.com=20 Sent: Sunday, April 14, 2002 11:25 AM Subject: Re: [CANSLIM] Bear Rally? Robert, While Small Cap Value is leading, the small cap growth, mid cap = growth, mid cap value are also very strong and posting similar results. = All of them are dwarfing large cap value and growth. Since the most recent market bottom 9/21, here are the returns using = the ETF's as proxy: Small Cap Growth: +34.78% Mid Cap Growth: + 33.5% Small Cap Value: + 45.35% Mid Cap Value: + 34.8% Certainly nothing to sneeze at. See a chart at: = http://stockcharts.com/webcgi/wb.exe?Perf.web+ijt,ijk,iwf,ijs,ijj,ive Katherine ----- Original Message -----=20 From: Robert McGill=20 To: canslim@lists.xmission.com=20 Sent: Sunday, April 14, 2002 10:07 AM Subject: Re: [CANSLIM] Bear Rally? I think that when discussing small cap it is impt to make a = distinction between growth and value. Value is currently leading. ----- Original Message -----=20 From: Katherine Malm=20 To: canslim@lists.xmission.com=20 Sent: Sunday, April 14, 2002 10:44 AM Subject: Re: [CANSLIM] Bear Rally? 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_038D_01C1E3B1.FE6987D0 Content-Type: text/html; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable
well said, Katherine.
 
Tom Worley
stkguru@bellsouth.net
AIM:=20 TexWorley
----- Original Message -----=20
From: Katherine Malm=20
Sent: Sunday, April 14, 2002 12:35 PM
Subject: Re: [CANSLIM] Bear Rally?

Robert,
 
That was not the point of the discussion.  While I am not = going=20 to dispute the returns on precious metals, it is not the charter of this = group=20 to discuss commodities. Your insistence on turning every discussion into = a=20 reference to gold stocks is bordering on touting and I believe = inappropriate for=20 list discussion.
 
Katherine
----- Original Message -----
From:=20 Robert=20 McGill
Sent: Sunday, April 14, 2002 = 11:30=20 AM
Subject: Re: [CANSLIM] Bear = Rally?

Those are certainly incredible = returns with=20 etf's.  How do they stack up against precious = metals?
----- Original Message -----
From:=20 Katherine=20 Malm
Sent: Sunday, April 14, 2002 = 11:25=20 AM
Subject: Re: [CANSLIM] Bear=20 Rally?

Robert,
 
While Small Cap Value is leading, the small cap growth, mid cap = growth,=20 mid cap value are also very strong and posting similar results. All = of them=20 are dwarfing large cap value and growth.
 
Since the most recent market bottom 9/21, here are the returns = using=20 the ETF's as proxy:
Small Cap Growth: +34.78%
Mid Cap Growth: + 33.5%
Small Cap Value: + 45.35%
Mid Cap Value: + 34.8%
 
Certainly nothing to sneeze at.
 
See a chart at:
http://stockcharts.com/webcgi/wb.exe?Perf.web+ijt,ijk,iwf,ijs,ijj,i= ve
 
Katherine
----- Original Message ----- =
From:=20 Robert=20 McGill
To: canslim@lists.xmission.com= =20
Sent: Sunday, April 14, = 2002 10:07=20 AM
Subject: Re: [CANSLIM] Bear = Rally?

I think that when discussing = small cap it is=20 impt to make a distinction between growth and value.  Value = is=20 currently leading.
----- Original Message ----- =
From:=20 Katherine=20 Malm
To: canslim@lists.xmission.com= =20
Sent: Sunday, April 14, = 2002 10:44=20 AM
Subject: Re: [CANSLIM] = Bear=20 Rally?

Duke, Tom, jans,
 
I'll bet the small to large cap migration has more to do = with the=20 length of the Secular Bull than anything else. In the early = stages of a=20 new Bull market, small caps (especially those with high growth=20 characteristics) lead the market. It makes intuitive sense. As = the bull=20 wears on, those "small caps"  become "big caps" as more and = more=20 money is drawn to the stock. It's the very thing that CANSLIM is = looking=20 for in the "I"...that is, you watch for evidence of = institutional monies=20 moving into the stock and then just follow their lead. Once the = stocks=20 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=20 they blew out of their first stage bases. Nearly every high = flier late=20 in '98 and '99 was a late stage base. Only those companies that = have the=20 wherewithal  to survive as a business and expand their=20 markets will set up new first stage bases.  = Non-CANSLIMers are=20 still chasing AOL, DELL, CSCO, etc., all former winners and = all=20 large caps due to their huge runs in the 90's. CANSLIMers know=20 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=20 evidence for the "emerging new bull" point of view.
 
Katherine
----- Original Message ----- =
From:=20 Tom=20 Worley
To: canslim@lists.xmission.com= =20
Sent: Sunday, April 14, = 2002 9:20=20 AM
Subject: Re: [CANSLIM] = Bear=20 Rally?

Duke,

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

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

Tom Worley
stkguru@bellsouth.net
AIM:=20 TexWorley
----- Original Message -----
From: "Duke = Miller"=20 <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. Can you say "CANSLICM?"

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

Duke

-----Original=20 Message-----
From: owner-canslim@lists.xmis= sion.com
[mailto:owner-canslim@lists.xmission.com]=20 On Behalf Of Spencer48@aol.com
Sent: 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=20 (4/15) the column focuses on the fact
that
small caps = are doing=20 well while the big caps are lagging.  This=20 approach
is
interesting.  Apparently one should = look=20 at:  The Mkts ->The Industry = - ->
The
Capitalization=20 (whether the stock is a big cap or a small cap makes = a
difference,=20 according to the article, regarding the probability that=20 the

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

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

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

jans



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

<< MessageHi Duke,

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

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

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

 Katherine

 PS.... The term = "rally" is=20 used in many contexts, even within the = IBD
and
Investors.com. Is=20 it an upswing? Is it action after a followthru day? Is
it=20 a
Bull? How persistent does an upswing need to be before = it's no=20 longer
considered "a rally"? Rally relative to what? = relative to=20 when?
Geez....very
confusing terminology.=20 = >>
= - ------=_NextPart_000_038D_01C1E3B1.FE6987D0-- - - - -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 #2304 ****************************** 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.