From: owner-canslim-digest@lists.xmission.com (canslim-digest) To: canslim-digest@lists.xmission.com Subject: canslim-digest V2 #3079 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 Friday, December 6 2002 Volume 02 : Number 3079 In this issue: RE: [CANSLIM] Fundamental Philosophies Re: [CANSLIM] NXTL, SXT Re: [CANSLIM] Fundamental Philosophies ---------------------------------------------------------------------- Date: Fri, 6 Dec 2002 02:12:40 -0600 From: "Fred Richards" Subject: RE: [CANSLIM] Fundamental Philosophies This is a multi-part message in MIME format. - ------=_NextPart_000_001B_01C29CCC.F47EB040 Content-Type: text/plain; charset="utf-8" Content-Transfer-Encoding: quoted-printable Any worthwhile profession and/or endeavor requires patience, time and = money to try to learn. Even then, not all who start stay the course. I think one of the best things you did was to stay out of the market = since you were unwilling to trade on the short side. . . something that = is extremely risky for most people. I know many investors who lost = their shirts trying to buck the market and thinking it would come back. = The CANSLIM system prevents you from losing much money if done = correctly. But in any bear market, there will always be a number of = stocks that do well. TSCO being one of those the past year. It was = identified through CANSLIM filters. -----Original Message----- From: owner-canslim@lists.xmission.com = [mailto:owner-canslim@lists.xmission.com]On Behalf Of NANCY POLCARO Sent: Friday, December 06, 2002 12:04 AM To: canslim Subject: Re: [CANSLIM] Fundamental Philosophies I would just like to put in my opinion if possible. For people who are = just learning the IBD system and doing all the wrong things and not = making money(especially in this market) it is a big expense-on top of no = profits and maybe losing money. For people who have traded for 40 years = and have their own web site and know Bill O'neil personally, I'm sure it = is well worth the money. I think the problem is -how do you learn the = system when you have no stock market background unless you pay that = much money just to try to learn. I had the paper for two years. I = thought I was learning it but in fact I was just doing well because I = was caught up in the last two years of a raging bull market. I let the = paper go when stocks were going no where but down. When the market = turns I will probably try it again but in the mean time it is to big of = an expense to pay for training. Especially if we have a 10 year bear. = Sorry if I ask simple questions right now, but the books and this web = site are where I'm being taught right now. I want to thank everyone on = this site for all the help and training you offer the rest of us. nancy ----- Original Message ----- From: Fred Richards Sent: Thursday, December 05, 2002 9:35 PM To: canslim@lists.xmission.com Subject: RE: [CANSLIM] Fundamental Philosophies Curt, After some 40 years in this business, I believe that one of the = guidelines my mentor pounded into my head is still applicable. "You get what you pay for in this business." Fred -----Original Message----- From: owner-canslim@lists.xmission.com = [mailto:owner-canslim@lists.xmission.com]On Behalf Of Curt Corley Sent: Thursday, December 05, 2002 9:22 PM To: canslim@lists.xmission.com Subject: RE: [CANSLIM] Fundamental Philosophies Fred, =20 I was just joking about the online service. Maybe I should have = put a =E2=80=9C;)=E2=80=9D after that statement, instead of a = =E2=80=9C:).=E2=80=9D =20 =20 I agree with the idea that the cost is not very significant if you = are able to make significantly more than $500 using DGO and IBD = =E2=80=93 especially if you are unable to make that amount without DGO. = However, that could very well strengthen the argument in favor of lower = cost, because (1) there are quite a few people out there who are not in = your position and who don=E2=80=99t have the starting capital and/or = skills to make a significant amount over $500, and (2) there are quite a = few people out there who can make significant money without the service. = ;) =20 Curt =20 -----Original Message----- From: owner-canslim@lists.xmission.com = [mailto:owner-canslim@lists.xmission.com] On Behalf Of Fred Richards Sent: Thursday, December 05, 2002 8:36 PM To: canslim@lists.xmission.com Subject: RE: [CANSLIM] Fundamental Philosophies =20 And just how much will you charge? Have you given any = consideration to the costs involved? Or how many people might sign up = for another stock rating service? =20 It is always great to leverage off other people's work but unless = you can make a profit after all the costs both known and unknown are = caculated, don't make the number 1 mistake of most entrepreneurs . . . = failing to consider the cost of one's time. =20 Since I make a few more dollars than $500 using the DGO and IBD, = the cost is only material to those who don't. -----Original Message----- From: owner-canslim@lists.xmission.com = [mailto:owner-canslim@lists.xmission.com]On Behalf Of Curt Corley Sent: Thursday, December 05, 2002 8:15 PM To: canslim@lists.xmission.com Subject: [CANSLIM] Fundamental Philosophies Hi, =20 I hope you don=E2=80=99t mind me changing the subject name of = this thread to something a little more appropriate than NXTL and SXT.=20 =20 To answer your question: Yes, I would certainly consider = purchasing a stock if the ROE was less than 16.5% with all other factors = looking good. As you know, I=E2=80=99ve purchased PECS and MNTR = recently -- two stocks that were a lot less perfect than the theoretical = stock you mentioned. I get your point, and you are right: an ROE below = 17% certainly does not mean the company or the stock is bad. But = here=E2=80=99s a situation to consider. Let=E2=80=99s say you have = screened 9,100+ stocks, and came up with a dozen or so stocks that have = what you consider to be near-perfect fundamentals. And let=E2=80=99s = say a few of those look like they might break out of a base formation = within the next couple of weeks. Would you rather wait around for the = possibility that those stocks with the best fundamentals will break out? = Or would rather purchase stocks that have already broken out but which = have less stellar fundamentals? Within a very short time after = purchasing PECS and MNTR, I saw other stocks with better fundamentals = that looked like they were ready to make a move. Of course, = that=E2=80=99s a tough thing to watch, and that=E2=80=99s why I put some = thought into this question. Given my situation and my personality, I = decided I would rather keep my eye on only the very best ones. = That=E2=80=99s why I decided last weekend to screen only the = near-perfect ones and keep an eye on those. And now you, Andy, and Tom = are starting to make me doubt that decision. Thanks a lot! :) =20 Seriously now: this has been a very educational and interesting = thread. Hopefully, by the time we are through with this, we will have = figured out the best overall stock-picking system; then we can start an = on-line rating system and screening service that doesn=E2=80=99t cost = $500 a year. :) =20 Curt =20 P.S. =E2=80=93 I would like to open a topic up some time in the = future about the use of earnings estimates. But this topic is enough = for now. My laptop is over-heating. I=E2=80=99m coming into work = tired. And my wife is starting to forget my middle name. =20 -----Original Message----- From: owner-canslim@lists.xmission.com = [mailto:owner-canslim@lists.xmission.com] On Behalf Of kmalm Sent: Thursday, December 05, 2002 11:44 AM To: canslim@lists.xmission.com Subject: RE: [CANSLIM] NXTL, SXT =20 Hi Curt, =20 I think you've identified the stickier issues in CANSLIM and = interpreting WON's work. As both Tom and Andy have pointed out in their = posts, while WON may *seem* to be stating that ROE>=3D17 is a "minimum = requirement' it turns out it is a guidepost to lead you to better = quality stocks. As with other indicators, this is based on his = historical view of winning stocks, meaning that "on average" winning = stocks had an ROE>=3D17. As with D/E, ROE can be misleading. For = example, if a company rejiggers their capital structure and increases = their outstanding shares, this will have an immediate impact on the ROE = measure. Another way of viewing it would simply be by asking a question. = That is, if you were looking at a stock and it had a "perfect" cup with = handle (ok, it's theoretical!); high RS Rank; an RS line making new = highs; met all other earnings, sales and profit margin guidelines, and = broke out on 150% of ADV, would you pass it up because it had an ROE of = 16.5%? If so, why? Does the "low" ROE mean that it is not a good company = or a good stock? =20 Katherine =20 - ------=_NextPart_000_001B_01C29CCC.F47EB040 Content-Type: text/html; charset="utf-8" Content-Transfer-Encoding: quoted-printable =EF=BB=BF
Any = worthwhile profession=20 and/or endeavor requires patience, time and money to try to learn. Even = then,=20 not all who start stay the course.
 
I think one = of the best=20 things you did was to stay out of the market since you were unwilling to = trade=20 on the short side. . . something that is extremely risky for most = people. =20 I know many investors who lost their shirts trying to buck the market = and=20 thinking it would come back. 
 
The CANSLIM = system=20 prevents you from losing much money if done correctly.  But in any = bear=20 market, there will always be a number of stocks that do well.  TSCO = being=20 one of those the past year.  It was identified through CANSLIM=20 filters.
-----Original Message-----
From:=20 owner-canslim@lists.xmission.com=20 [mailto:owner-canslim@lists.xmission.com]On Behalf Of NANCY=20 POLCARO
Sent: Friday, December 06, 2002 12:04 = AM
To:=20 canslim
Subject: Re: [CANSLIM] Fundamental=20 Philosophies

I would just like to put in my opinion if possible. For people = who are=20 just learning the IBD system and doing all the wrong things and not = making=20 money(especially in this market) it is a big expense-on top of no = profits and=20 maybe losing money. For people who have traded for 40 years and have = their own=20 web site and know Bill O'neil personally, I'm sure it is well worth = the=20 money.  I think the problem is -how do you learn the = system  =20 when you have no stock market background unless you pay that = much =20 money just to try to learn. I had the paper for two years.  I = thought I=20 was learning it but in fact I was just doing well because I was caught = up in=20 the last two years of a raging bull market.  I let the paper = go =20 when stocks were going no where but down.  When the market turns = I will=20 probably try it again but in the mean time it is to big of an expense = to pay=20 for training.  Especially if we have a 10 year bear.  Sorry = if I ask=20 simple questions right now, but the books and this web site are where = I'm=20 being taught right now. I want to thank everyone on this site for all = the help=20 and training you offer the rest of us.  nancy
 
----- Original Message -----
From:=20 Fred Richards
Sent: Thursday, December 05, = 2002 9:35=20 PM
To: = canslim@lists.xmission.com
Subject: RE: [CANSLIM] = Fundamental=20 Philosophies
 
Curt,
 
After=20 some 40 years in this business, I believe that one of the guidelines = my=20 mentor pounded into my head is still applicable.
 
"You get=20 what you pay for in this business."
 
Fred
-----Original Message-----
From:=20 owner-canslim@lists.xmission.com=20 [mailto:owner-canslim@lists.xmission.com]On Behalf Of Curt=20 Corley
Sent: Thursday, December 05, 2002 9:22 = PM
To:=20 canslim@lists.xmission.com
Subject: RE: [CANSLIM] = Fundamental=20 Philosophies

Fred,

 

I was = just joking=20 about the online service. =20 Maybe I should have put a =E2=80=9C;)=E2=80=9D after that = statement, instead of a=20 =E2=80=9C:).=E2=80=9D =20

 

I agree = with the=20 idea that the cost is not very significant if you are able to make = significantly more than $500 using DGO and IBD =E2=80=93 = especially if you are=20 unable to make that amount without DGO.  However, that could very = well=20 strengthen the argument in favor of lower cost, because (1) there = are=20 quite a few people out there who are not in your position and who = don=E2=80=99t=20 have the starting capital and/or skills to make a significant = amount over=20 $500, and (2) there are quite a few people out there who can make=20 significant money without the service.  = ;)

 

Curt

 

-----Original=20 Message-----
From:=20 owner-canslim@lists.xmission.com = [mailto:owner-canslim@lists.xmission.com]=20 On Behalf Of Fred=20 Richards
Sent:=20 Thursday,=20 December 05, 2002 = 8:36=20 PM
To:=20 canslim@lists.xmission.com
Subject: RE: [CANSLIM] = Fundamental=20 Philosophies

 

And=20 just how much will you charge?  Have you given any = consideration to=20 the costs involved?  Or how many people might sign up for = another=20 stock rating service?

 

It=20 is always great to leverage off other people's work but unless you = can=20 make a profit after all the costs both known and unknown are = caculated,=20 don't  make the number 1 mistake of most entrepreneurs . . . = failing=20 to consider the cost of one's = time.

 

Since I = make a=20 few more dollars than $500 using the DGO and IBD, the cost is only = material to those who don't.

-----Original=20 Message-----
From:=20 owner-canslim@lists.xmission.com=20 [mailto:owner-canslim@lists.xmission.com]On Behalf Of Curt=20 Corley
Sent: = Thursday,=20 December 05, 2002 8:15 PM
To:=20 canslim@lists.xmission.com
Subject: [CANSLIM] = Fundamental=20 Philosophies

Hi,

 

I = hope you=20 don=E2=80=99t mind me changing the subject name of this thread = to something a=20 little more appropriate than NXTL and SXT. =

 

To = answer your=20 question:  Yes, I = would=20 certainly consider purchasing a stock if the ROE was less than = 16.5%=20 with all other factors looking good.  As you know, = I=E2=80=99ve purchased=20 PECS and = MNTR=20 recently -- two stocks that were a lot less perfect than the = theoretical=20 stock you mentioned.  = I get=20 your point, and you are right: =20 an ROE below 17% certainly does not mean the company or = the stock=20 is bad.  But = here=E2=80=99s a=20 situation to consider. =20 Let=E2=80=99s say you have screened 9,100+ stocks, and = came up with a=20 dozen or so stocks that have what you consider to be = near-perfect=20 fundamentals.  And = let=E2=80=99s say=20 a few of those look like they might break out of a base = formation within=20 the next couple of weeks. =20 Would you rather wait around for the possibility that = those=20 stocks with the best fundamentals will break out?  Or would rather = purchase stocks=20 that have already broken out but which have less stellar=20 fundamentals?  = Within a very=20 short time after purchasing = PECS and = MNTR, I=20 saw other stocks with better fundamentals that looked like they = were=20 ready to make a move.  = Of=20 course, that=E2=80=99s a tough thing to watch, and = that=E2=80=99s why I put some thought=20 into this question.  = Given=20 my situation and my personality, I decided I would rather keep = my eye on=20 only the very best ones.  = That=E2=80=99s why I decided last weekend to screen only = the near-perfect=20 ones and keep an eye on those. =20 And now you, Andy, and Tom are starting to make me doubt = that=20 decision.  Thanks = a=20 lot! =20 :)

 

Seriously=20 now:  this has = been a very=20 educational and interesting thread.  Hopefully, by the time = we are=20 through with this, we will have figured out the best overall=20 stock-picking system; then we can start an on-line rating system = and=20 screening service that doesn=E2=80=99t cost $500 a year.  = :)

 

Curt

 

P.S. = =E2=80=93 I would=20 like to open a topic up some time in the future about the use of = earnings estimates.  = But=20 this topic is enough for now. =20 My laptop is over-heating. =20 I=E2=80=99m coming into work tired. =20 And my wife is starting to forget my middle=20 name.

 

-----Original=20 Message-----
From:=20 owner-canslim@lists.xmission.com=20 [mailto:owner-canslim@lists.xmission.com] On Behalf Of = kmalm
Sent: = Thursday, = December 05,=20 2002 = 11:44=20 AM
To:=20 canslim@lists.xmission.com
Subject: RE: [CANSLIM] = NXTL,=20 SXT

 

Hi=20 Curt,

 

I think you've = identified the=20 stickier issues in CANSLIM and interpreting WON's work. As both = Tom and=20 Andy have pointed out in their posts, while WON may *seem* to be = stating=20 that ROE>=3D17 is a "minimum requirement' it turns out it is = a=20 guidepost to lead you to better quality stocks. As with other=20 indicators, this is based on his historical view of winning = stocks,=20 meaning that "on average" winning stocks had an ROE>=3D17. As = with D/E,=20 ROE can be misleading. For example, if a company rejiggers their = capital=20 structure and increases their outstanding shares, this will have = an=20 immediate impact on the ROE measure. Another way of viewing it = would=20 simply be by asking a question. That is, if you were looking at = a stock=20 and it had a "perfect" cup with handle (ok, it's theoretical!); = high RS=20 Rank; an RS line making new highs; met all other earnings, sales = and=20 profit margin guidelines, and broke out on 150% of ADV, would = you pass=20 it up because it had an ROE of 16.5%? If so, why? Does the "low" = ROE=20 mean that it is not a good company or a good=20 stock?

 

Katherine

 

= - ------=_NextPart_000_001B_01C29CCC.F47EB040-- - - - -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: Fri, 6 Dec 2002 08:21:44 EST From: AJAskey@aol.com Subject: Re: [CANSLIM] NXTL, SXT - --part1_142.459e0b2.2b21fe68_boundary Content-Type: text/plain; charset="US-ASCII" Content-Transfer-Encoding: 7bit Katherine, My thought is the fundies don't make a bit of difference of the first 10-20% of the move. When "M" is bad very little works no matter what the fundies are. When "M" is cooking everything works no matter what the fundies are. CANSLIM attempts to separate those stocks capable of making the 20-1500% move from those that can't. Many appear to get sucked in during a good "M" to buying only from a good base. This works fine but it is tougher to make a reasonable long term return making only 20% on each positive buy while losing 8% on each negative buy and then staying in cash during the bad "M". If I were to make 500% during a good bull run I would have less temptation to try to make up for missing the big moves in a bad "M" when I only turned several 20% gainers into 100% return during the bull. Andy In a message dated 12/5/2002 11:27:03 PM Central Standard Time, kmalm@earthlink.net writes: > To Curt's original point, each investor has to find a meaningful set of > rules to follow within a set of style guidelines (in this case, CANSLIM), > trade by them, and then adjust as necessary as they learn from their post > analysis. > - --part1_142.459e0b2.2b21fe68_boundary Content-Type: text/html; charset="US-ASCII" Content-Transfer-Encoding: 7bit Katherine,

My thought is the fundies don't make a bit of difference of the first 10-20% of the move.  When "M" is bad very little works no matter what the fundies are.  When "M" is cooking everything works no matter what the fundies are.  CANSLIM attempts to separate those stocks capable of making the 20-1500% move from those that can't.

Many appear to get sucked in during a good "M" to buying only from a good base.  This works fine but it is tougher to make a reasonable long term return making only 20% on each positive buy while losing 8% on each negative buy and then staying in cash during the bad "M".   If I were to make 500% during a good bull run I would have less temptation to try to make up for missing the big moves in a bad "M" when I only turned several 20% gainers into 100% return during the bull.

Andy

In a message dated 12/5/2002 11:27:03 PM Central Standard Time, kmalm@earthlink.net writes:


To Curt's original point, each investor has to find a meaningful set of rules to follow within a set of style guidelines (in this case, CANSLIM), trade by them, and then adjust as necessary as they learn from their post analysis.


 - --part1_142.459e0b2.2b21fe68_boundary-- - - - -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: Fri, 6 Dec 2002 08:23:43 EST From: AJAskey@aol.com Subject: Re: [CANSLIM] Fundamental Philosophies - --part1_181.13107aea.2b21fedf_boundary Content-Type: text/plain; charset="US-ASCII" Content-Transfer-Encoding: 7bit So you are now saying you don't always get what you pay for....? Sorry, just had to as the setup was perfect... LOL Andy In a message dated 12/6/2002 1:59:31 AM Central Standard Time, ffradrich@attbi.com writes: > Actually, Curt, we used Value Line for many years but dropped it over a > decade ago. It just was not a good source for us. > - --part1_181.13107aea.2b21fedf_boundary Content-Type: text/html; charset="US-ASCII" Content-Transfer-Encoding: 7bit So you are now saying you don't always get what you pay for....?  Sorry, just had to as the setup was perfect... LOL

Andy

In a message dated 12/6/2002 1:59:31 AM Central Standard Time, ffradrich@attbi.com writes:


Actually, Curt, we used Value Line for many years but dropped it over a decade ago.  It just was not a good source for us. 


- --part1_181.13107aea.2b21fedf_boundary-- - - - -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 #3079 ****************************** 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.