From: owner-canslim-digest@lists.xmission.com (canslim-digest) To: canslim-digest@lists.xmission.com Subject: canslim-digest V2 #368 Reply-To: canslim Sender: owner-canslim-digest@lists.xmission.com Errors-To: owner-canslim-digest@lists.xmission.com Precedence: bulk X-No-Archive: yes canslim-digest Wednesday, August 26 1998 Volume 02 : Number 368 In this issue: [CANSLIM] I'm in Re: [CANSLIM] canslim in a weak market Re: [CANSLIM] canslim in a weak market [CANSLIM] One to Watch Re: [CANSLIM] RUT revisited [CANSLIM] GVA [CANSLIM] RUT Re: [CANSLIM] RUT revisited Re: [CANSLIM] GVA Re: [CANSLIM] Some more random thoughts Re: [CANSLIM] Some more random thoughts [CANSLIM] Re: RUT revisited [CANSLIM]Account peformance Re: [CANSLIM] I'm in Re: [CANSLIM] RUT Re: [CANSLIM] RUT revisited Re: [CANSLIM] RUT revisited Re: [CANSLIM] RUT Re: [CANSLIM] RUT revisited [CANSLIM] Group Strength, FWIW [CANSLIM] Re: RUT revisited Re: [CANSLIM] Re: RUT revisited [CANSLIM] Some random thoughts (noise) on "M" [CANSLIM] Watch list [CANSLIM] Leadership Re: [CANSLIM] Watch list ---------------------------------------------------------------------- Date: Tue, 25 Aug 1998 18:10:27 -0700 From: "Mike Lucero" Subject: [CANSLIM] I'm in I hope I'm not making a big mistake, but I've been getting in. I bought a couple stocks last week and was stopped out on the retest. But most of the stocks on my watchlist look pretty good. Mike - - ------------------------------ Date: Tue, 25 Aug 1998 20:15:43 -0500 From: "John Adair, M.D." Subject: Re: [CANSLIM] canslim in a weak market I find it is difficult to keep focused on canslim stocks when the market is so weak. Stocks are out there but it is a good time to study become more focused on what we actually need. will someone tell me where Ian is hanging our. some one told me once and I lost it. John Adair Tom Worley wrote: > > Frank, > I'm not attacking anyone in particular, but just desirous of getting > this group back to being a CANSLIM site, not a general investment > discussion site, before it's too late and we lose it. There are plenty > of places on the net where general investment stuff can be discussed, > but very few that are established and intended to be pure CANSLIM. > This was once one of them. > > As to shorting being "very much" a part of CANSLIM, if you can point > me to the pages in HTMMIS, I'll go back and reread it. But as my aging > memory serves me, WON does not advocate shorting as a general > practice, nor does he advocate shorting in a bull mkt, and we have yet > to enter into a bear mkt, despite some painful corrections. You can > argue that some sectors have been in a bear mkt, but overall we are > still in a bull mkt. > > Tom W > > -----Original Message----- > From: Frank V. Wolynski > To: canslim@lists.xmission.com > Date: Wednesday, August 19, 1998 7:03 AM > Subject: Re: [CANSLIM] Some picks for bullish CANSLIMers > > >At 00:13 8/19/98 -0400, you wrote: > >>For a variety of reasons (tired of reading about all the shorting > >>opportunities; > >...SNIPED... > >> but rather joined this site to learn and share more about WON's > version of > >>CANSLIM. > >> > >...SNIPED... > >> > >>Hope this sets this group back on a serious CANSLIM style discussion > >>group. > >> > >>Tom W > >> > > > >Not desiring to pick an argument, but shorting is very much a part of > >canslim as I remember reading it in HTMMIS. If I personally have > deviated > >from CANSLIM an intolerable amount, please say so directly and > clearly. If > >not, or my deviations have been tolerable, your silence will also > send the > >appropriate message. > > > >This group gets off the subject on many occassions and I find my > freedom of > >selecting 'next message' quite sufficient to get back to the matter > at hand. > > > >Personally I enjoy the different perspectives, and interpretations of > >market/stock phenomena. I don't enjoy the personal attacks, however, > 'next > >message' isn't quite as effective in getting past those. > > > >Best Regards, > >Frank Wolynski > > > > > >- > > > > - - - ------------------------------ Date: Tue, 25 Aug 1998 21:12:19 -0400 From: Scott Vickery Subject: Re: [CANSLIM] canslim in a weak market From one of the messages that I have saved: http://sosadvisors.com/ianshome.htm Scott At 08:15 PM 8/25/98 -0500, you wrote: >I find it is difficult to keep focused on canslim stocks when the market >is so weak. Stocks are out there but it is a good time to study become >more focused on what we actually need. >will someone tell me where Ian is hanging our. some one told me once and >I lost it. >John Adair > > > > > > > >Tom Worley wrote: >> >> Frank, >> I'm not attacking anyone in particular, but just desirous of getting >> this group back to being a CANSLIM site, not a general investment >> discussion site, before it's too late and we lose it. There are plenty >> of places on the net where general investment stuff can be discussed, >> but very few that are established and intended to be pure CANSLIM. >> This was once one of them. >> >> As to shorting being "very much" a part of CANSLIM, if you can point >> me to the pages in HTMMIS, I'll go back and reread it. But as my aging >> memory serves me, WON does not advocate shorting as a general >> practice, nor does he advocate shorting in a bull mkt, and we have yet >> to enter into a bear mkt, despite some painful corrections. You can >> argue that some sectors have been in a bear mkt, but overall we are >> still in a bull mkt. >> >> Tom W >> >> -----Original Message----- >> From: Frank V. Wolynski >> To: canslim@lists.xmission.com >> Date: Wednesday, August 19, 1998 7:03 AM >> Subject: Re: [CANSLIM] Some picks for bullish CANSLIMers >> >> >At 00:13 8/19/98 -0400, you wrote: >> >>For a variety of reasons (tired of reading about all the shorting >> >>opportunities; >> >...SNIPED... >> >> but rather joined this site to learn and share more about WON's >> version of >> >>CANSLIM. >> >> >> >...SNIPED... >> >> >> >>Hope this sets this group back on a serious CANSLIM style discussion >> >>group. >> >> >> >>Tom W >> >> >> > >> >Not desiring to pick an argument, but shorting is very much a part of >> >canslim as I remember reading it in HTMMIS. If I personally have >> deviated >> >from CANSLIM an intolerable amount, please say so directly and >> clearly. If >> >not, or my deviations have been tolerable, your silence will also >> send the >> >appropriate message. >> > >> >This group gets off the subject on many occassions and I find my >> freedom of >> >selecting 'next message' quite sufficient to get back to the matter >> at hand. >> > >> >Personally I enjoy the different perspectives, and interpretations of >> >market/stock phenomena. I don't enjoy the personal attacks, however, >> 'next >> >message' isn't quite as effective in getting past those. >> > >> >Best Regards, >> >Frank Wolynski >> > >> > >> >- >> > >> >> - > >- > > - - ------------------------------ Date: Tue, 25 Aug 1998 20:44:36 -0700 (PDT) From: dbphoenix Subject: [CANSLIM] One to Watch While working on surrogate groups today, I ran across VRTS again. It's building a very nice base and has loads of support at 50. Definitely one to watch as it'll take a couple of weeks for the 50d to meet up with the price. Maybe by then the Asian crisis will be over and Clinton will be completely exonerated ;) - --Db _________________________________________________________ DO YOU YAHOO!? Get your free @yahoo.com address at http://mail.yahoo.com - - ------------------------------ Date: Tue, 25 Aug 1998 22:50:04 -0800 From: "Patrick Wahl" Subject: Re: [CANSLIM] RUT revisited > As an example, I am doing positively miserably this year. I have seriously > underperformed the S&P and DJIA. However, my returns correlate well with > the Russell 2000. If it makes you feel better, I haven't been able to get anything out of the market either. Looking at the indices tonight, the Russell is at the same level it was at in June of 1997, 390, with a high in between of 490, so it has fallen 20% off its high, and has not made any progress in 14 months. The S&P, on the other hand, is 200 points above where it was in June, 1997, and only about 90 points off its high of 1184 (or so), maybe 8% off its high. Just goes to show how critical the M part of the equation is, just can't buck the overall trend of the market. > > 2. Regarding support for RUT - I don't see any. I'm not really proficient > at technical patterns such as the aforementioned triangle, but I see a > big concave parabola. When RUT dropped below 407 - it took out any > support I was "seeing". If I had ANY sense, I'd be totally out of the > market now - but: I guess you could make a case that the 370 level, where the RUT got to in early 1997 before dropping back to the 340 level for a bit, is the next support. I don't know if that is very firm this far away from it. > 3. Now that I've convinced everyone that I'm a total idiot, I've also > looked at some of the top small cap funds over the last 5 years - > most have tanked over the last month - much more than the DJIA, S&P, > NASDAQ, etc... This is further evidence that one should use the > index which most neatly correlates with one's stock selection > technique. This and my numbers above make me think that on the next leg, the good money to be made should be in the small caps. THey can't underperform for ever. Seems like the huge gains of the S&P have come from a combination of PE expansion and earnings gains. Hard to see that P/E's can expand much more, so gains based on earnings growth will be much more modest. With small caps lagging so badly, they would seem to represent the best value. > > Caveats to this whole thing: I'm not very good at judging "M". I have > not outperformed the big cap indices since '95 - when I trounced it. > I am quite averse to buying big caps - because I'm a bit myopic in > seeing big growth there when many of these companies are so big > already - so I'm biased. After watching the whole setup to this summer's decline, I think looking at numbers that reflect market internals are very important. Look at the A/D numbers - some sort of moving average of the difference as one, and a net of the difference in A/D as another, and maybe new highs and lows. That A/D net line tailed off way before the serious damage was done to the overall market. - - ------------------------------ Date: Wed, 26 Aug 1998 10:00:02 +0300 From: "David S. Pinhasik" Subject: [CANSLIM] GVA I bought 7 weeks ago. It went from 21.2 (adjusted for stock split 3/2) to 32 and is now at 28.2 - I am at +33%. According to HTMMIS, I should wait the full 8 weeks. Why? Also, a few companies (Soloman Smith Barney, Schroedr) have downgraded it. Should this concern me? Ideas appreciated, but in any case thanks to Peter who brought it to our attention. David - - ------------------------------ Date: Wed, 26 Aug 1998 00:14:41 -0400 From: Kom Tukovinit Subject: [CANSLIM] RUT Doesn't the Weekly Russell 2000 look like a head & shoulder formation to anyone? With the left shoulder starting on 7/18/97, the head on 1/30/98, and the right shoulder 6/19/98. The neckline was violated on 7/24/98. kom - - ------------------------------ Date: Wed, 26 Aug 1998 06:36:11 -0400 From: "Tom Worley" Subject: Re: [CANSLIM] RUT revisited Patrick, I do agree with you that the best earnings expansion is to be found among the small caps, that's why I completely concentrated on small caps for the past year. It's been a good learning experience, and profitable as well. However, for the third year in a row (I think it's 3, may even be longer) the small caps collectively (e.g. Russell 2000) have failed to even match, much less beat, the big caps. I used the RUT as a gauge of my success, and have beaten it easily, however that still only kept me in the ballpark with the big cap indexes, sometimes ahead, sometimes behind, but still playing. My most costly mistakes have been from lack of discipline, straying from my rules and "system". Part of that error was in intellectually observing the total lack of breadth in the mkt (both NYSE and Nasdaq) during the last leg, then ignoring what it meant. I knew the PEs, even allowing for strong employment, low inflation, yada yada yada, were still too high against even the most generous models. Something had to give, and thanks to the spreading economic problems worldwide, it was highly unlikely that earnings were going to suddenly improve and lower the PE ratio. Watching the advance/decline line gives a good day to day measure of breadth, thereby health, of a mkt move. Combining this with volume on positive days can also give an indication of the confidence factor. However, with institutionals controlling an ever increasing portion of the mkt, and so long as they choose liquidity over earnings expansion, I am afraid that there just aren't enough small cap funds to make the Russell 2000 a winner. Concentrating on the most liquid of the Russell 2000 might produce "above index" performance, however. Tom W - -----Original Message----- From: Patrick Wahl To: canslim@lists.xmission.com Date: Wednesday, August 26, 1998 12:52 AM Subject: Re: [CANSLIM] RUT revisited > As an example, I am doing positively miserably this year. I have seriously > underperformed the S&P and DJIA. However, my returns correlate well with > the Russell 2000. If it makes you feel better, I haven't been able to get anything out of the market either. Looking at the indices tonight, the Russell is at the same level it was at in June of 1997, 390, with a high in between of 490, so it has fallen 20% off its high, and has not made any progress in 14 months. The S&P, on the other hand, is 200 points above where it was in June, 1997, and only about 90 points off its high of 1184 (or so), maybe 8% off its high. Just goes to show how critical the M part of the equation is, just can't buck the overall trend of the market. This and my numbers above make me think that on the next leg, the good money to be made should be in the small caps. THey can't underperform for ever. Seems like the huge gains of the S&P have come from a combination of PE expansion and earnings gains. Hard to see that P/E's can expand much more, so gains based on earnings growth will be much more modest. With small caps lagging so badly, they would seem to represent the best value. - - ------------------------------ Date: Wed, 26 Aug 1998 06:48:33 -0400 From: "Tom Worley" Subject: Re: [CANSLIM] GVA David, WON's rule on holding a stock for at least 8 weeks if it goes up 20% in less time was based on his experience that these were more often the most powerful of stocks that subsequently went on to far greater performance, with the initial gain being only a small part of the overall increase. Remember also that HTMMIS is essentially over 10 years old, and today's volatility didn't exist then, any more than did the numbers of mutual funds, or the quantity of new money entering the mkt every month, nor the degree of institutional control of the mkt. Relying on this rule depends in part on your investment style. If you're a long term investor, comfortable holding a stock for a year or two, and not bothered by its ups and downs in the interim, then the rule may be useful. On the other hand, if you're more short term, or uncomfortable with current "M", or need to make some profits to offset past losses or to rebuild confidence, then there's nothing wrong in taking profits. As to the wirehouse downgrades, it's important to know WHY they downgraded. Did something fundamental happen, or did the stock price simply meet a forecast made 6 months ago for a 1 year target? Obviously if there is a fundamental problem, you should at least be cautious. Check also if there have been other wirehouses that upgraded, sometimes you can get real contradictory signals from the wirehouses. And then of course there are also the sceptics that believe wirehouses downgrade simply to scare people into selling them stock cheap so they can run it back up again with a cheap and replenished inventory (personally I don't believe this, but many do). Tom W - -----Original Message----- From: David S. Pinhasik To: canslim@lists.xmission.com Date: Wednesday, August 26, 1998 3:03 AM Subject: [CANSLIM] GVA >I bought 7 weeks ago. It went from 21.2 (adjusted for stock split 3/2) to >32 and is now at 28.2 - I am at +33%. >According to HTMMIS, I should wait the full 8 weeks. Why? >Also, a few companies (Soloman Smith Barney, Schroedr) have downgraded it. >Should this concern me? >Ideas appreciated, but in any case thanks to Peter who brought it to our >attention. > >David > > > >- > - - ------------------------------ Date: Wed, 26 Aug 1998 04:44:20 -0700 (PDT) From: TM Subject: Re: [CANSLIM] Some more random thoughts Hi, Tom, "as the selling pressure appears to have substantially dried up" Are you inferring "as the selling pressure appears to have substantially dried up" because the price held on low volume ie. not as many sellers? Thanks, TM - ---Tom Worley wrote: > > Looks now like we have had a third, and successful, retest of the > recent lows, and this third time is more encouraging as the selling > pressure appears to have substantially dried up. > > After the initial wakeup call on Latin American debt, intl mkts appear > to be reacting with more confidence to the Russian economic problems > and the decision to further float the ruble, along with restructuring > their debt, and again changing the govt. > > LATAM problems will continue throughout the region so long as > commodities prices remain depressed. This includes not just oil, but > also gold and other precious metals, copper, and some other less > important commodities. The entire region's economy is commodities > based, and the weaker demand from Asia in particular is devastating > the financial picture. > > Commodities prices have also hurt Canada, where once again, despite > currency intervention, Canada's dollar hit a new all time low against > the US dollar, and at a time when the US dollar was not even at its > peak. > > Japan continues to threaten intervention with words, but the threat is > losing its impact, as the yen weakened overnight against other > currencies. Lately it has been appearing that the Japanese mkt > reflects domestic sentiment, while the yen reflects intl sentiment, > and they have been working at cross purposes. I also noted that while > Japan managed to climb back over 15,000 it still failed to hold onto > most of its overnight gains. Hong Kong is again in the mkt buying its > blue chips with some success. Currencies are also in trouble in S. > Africa and Australia, among others. > > Asia had a decent day, Europe for once is responding in kind (Germany, > Switzerland and France all up over 2% last time I looked). And the > futures, tho off their earlier highs, are indicating a positive > opening. > > Looks to me like some of the froth and chaos in the various mkts is > calming down, however VIX still hovering around 30 so quite volatile. > > To my friends along the Eastern Seaboard, keep an eye on Hurricane > Bonnie, tho I do believe it will do no worse than sideswipe Cape > Hatteras before turning out to sea. With more trouble brewing in the > tropics, my attention is now on Danielle. > > Tom W > > > > - > > _________________________________________________________ DO YOU YAHOO!? Get your free @yahoo.com address at http://mail.yahoo.com - - ------------------------------ Date: Wed, 26 Aug 1998 08:00:23 -0400 From: "Tom Worley" Subject: Re: [CANSLIM] Some more random thoughts No, it's more simple, just looked at the up/down trend lines on DGO along with the volume for the same days. Saw that the up vol had not improved that much, but the down volume dropped along with total volume. Compared this to how it looked two weeks ago, and concluded that selling pressure had dropped substantially. I didn't even consider price trends in this comment. Tom W - -----Original Message----- From: TM To: canslim@lists.xmission.com Date: Wednesday, August 26, 1998 7:46 AM Subject: Re: [CANSLIM] Some more random thoughts >Hi, Tom, > >"as the selling >pressure appears to have substantially dried up" > >Are you inferring "as the selling >pressure appears to have substantially dried up" because the price >held on low volume ie. not as many sellers? > >Thanks, >TM > - - ------------------------------ Date: Wed, 26 Aug 1998 07:16:20 -0500 From: Dave Cameron Subject: [CANSLIM] Re: RUT revisited Thanks to all of you who responded to my post on RUT. It is also heartening to know that I am not the only one who is not doing well this year. The ironic part is that I was doing well when RUT was at 485. Since then, I have been paying too much attention to the S&P - and not enough to the fact that more stocks have been down than up. (and that the RUT has been tanking) I am of the opinion that the S&P is not such a great indicator of the market because it is so skewed by the index funds. It would be VERY tough to beat the S&P of late since it is out-performing nearly everything else. Dave C. - - ------------------------------ Date: Wed, 26 Aug 1998 06:39:03 -0600 From: "Dan Sutton" Subject: [CANSLIM]Account peformance I typically have attempted to maintain a couple of distinctive styles in my account. One has been the CANSLIM/HGS methods, the other has been more of a long term outlook (based on Ian Woodwards ideas on Mattress Stuffers). As I see has happened with many of you, my CS trading results are less than stellar. Looking back at my individual trades and notes I made during those, the largely due to my inability to sell properly. Almost every trade I made at one point was on the plus side, but because it was a slow steady drop in prices I was like Elders example of the frog getting boiled. I didn't think I was in trouble because the heat was only going up (or the prices going down) slowly. Had there been a faster change in temperature, I would have jumped out more quickly. My most recent successes were during June when I took HGS candidates as well as long term successful stocks like Ford, Lucent, Gillette and traded them short term..normally in and out within a week. Certainly not the CANSLIM approach, but the successful trades helped me develop the attitude of "take the money and run". Fortunately for me my two long term holdings have helped me overcome all those trading errors. Hopefully the lessons I learned this summer will help me during the next leg up. - - ------------------------------ Date: Wed, 26 Aug 1998 09:04:20 -0400 From: Tom Moulton Subject: Re: [CANSLIM] I'm in Mike Lucero wrote: > I hope I'm not making a big mistake, but I've been getting in. I bought a > couple stocks last week and was stopped out on the retest. But most of the > stocks on my watchlist look pretty good. > As long as you watch your stocks and stick to your stops you'll do better than the "average joe" Learn and use technical signals, I've been testing on paper and looked back at a number of loosing trades and while the RS, EPS, etc were all good the technical indicators (MACD and trend lines were wrong...) - - ------------------------------ Date: Wed, 26 Aug 1998 07:36:06 -0800 From: "Patrick Wahl" Subject: Re: [CANSLIM] RUT > Doesn't the Weekly Russell 2000 look like a head & shoulder formation to > anyone? With the left shoulder starting on 7/18/97, the head on > 1/30/98, and the right shoulder 6/19/98. The neckline was violated on > 7/24/98. I think you mean to use 10/97 instead of 7/18/97 as the left shoulder. If you look at it on a daily chart, you can see a smaller H&S forming over April and May of 1998, right at the top. - - ------------------------------ Date: Wed, 26 Aug 1998 07:50:49 -0800 From: "Patrick Wahl" Subject: Re: [CANSLIM] RUT revisited > My most costly mistakes have been from lack of discipline, straying > from my rules and "system". Part of that error was in intellectually I broke a rule or two this year on one stock, even after all my years of doing this, and it cost me also. Maybe someday I'll learn. > Watching the advance/decline line gives a good day to day measure of > breadth, thereby health, of a mkt move. Combining this with volume on > positive days can also give an indication of the confidence factor. > However, with institutionals controlling an ever increasing portion of > the mkt, and so long as they choose liquidity over earnings expansion, > I am afraid that there just aren't enough small cap funds to make the > Russell 2000 a winner. Concentrating on the most liquid of the Russell > 2000 might produce "above index" performance, however. On the other hand, what I am hoping anyway, is that it takes so much less money to move the small caps that some funds who are looking for potentially greater returns will move into smaller caps and give them a boost. The Russell tends to have long nearly uninterrupted trends when it does move up, I am hoping I can recognize this and be in the small caps when they move. - - ------------------------------ Date: Wed, 26 Aug 1998 07:57:33 -0800 From: "Patrick Wahl" Subject: Re: [CANSLIM] RUT revisited > As an example, I am doing positively miserably this year. I have seriously > underperformed the S&P and DJIA. However, my returns correlate well with > the Russell 2000. I had one other thought on this, why my performance this year stinks anway - usually I am able to get into one of the hot groups, a few years ago I found a semiconductor stock or two that did well. This year it was internet stocks, and I mostly missed them because I am a bit skittish about buying stocks without the C and A part of canslim. If you miss the group that is the hottest, you are going to have problems. I said this a few months ago regarding the internet stocks, but I'll repeat myself - it shows how important a clearly identifiable N(ew) is in Canslim. By clearly identifiable, I mean, even more than something like a new product or management or high, this is a totally new technology and way of transacting business, so wide open expectations. Probably N is second most important part of Canslim, after M. - - ------------------------------ Date: Wed, 26 Aug 1998 07:01:16 -0700 From: Tim Fisher Subject: Re: [CANSLIM] RUT Noticed that yesterday. Looks like it's headed to <340 by that logic, but it's irrelevant since small caps are so out of favor that even upgrades, split anouncements, and buyback programs can't lift them out of this slump. I have two small caps left that should have been sold 2 months ago, couldn't put hard stops on them and let them slide. IMHO anyone still holding small caps is playing with fire. I've been applying CANLIM to big caps esp. the IandexMS and have already bot a few after the follow through last week. Am waiting a few more out to see if they can form some sort of a base. FWIW my YTD average annual total return is at -4.68%. The way I calculate it, the combined AATR of the DJIA, NDX, SPX, and RUT YTD is +21.88%. The individual returns are: DJIA +12.59% NDX +63.67% RUT -16% SPX +19.21% 3 stocks are responsible for my miserable performance, all couldn't have hard stops, all tanked while I was away from the modem. I have not since nor will I ever buy a stock which I can't put a stop on. Without these 3 I would be at +9.5% - not too hot but not a loss either... P.S. This performance includes about 33% of my accounts which is invested in various mid- to large-cap growth and index tracking funds. They also have not performed as well as the NDX or even the combned indices - not by a long shot. At 12:14 AM 8/26/98 -0400, you wrote: >Doesn't the Weekly Russell 2000 look like a head & shoulder formation to >anyone? With the left shoulder starting on 7/18/97, the head on >1/30/98, and the right shoulder 6/19/98. The neckline was violated on >7/24/98. > >kom > Tim Fisher, 1995 President, Pacific Fishery Biologists Ore-ROCK-On Rockhounding Web Site PFB Information mailto:tim@OreRockOn.com WWW http://OreRockOn.com - - ------------------------------ Date: Wed, 26 Aug 1998 08:02:14 -0700 (PDT) From: dbphoenix Subject: Re: [CANSLIM] RUT revisited <> Keep in mind, though, that small-cap doesn't necessarily mean a limited number of shares. So many oil and semi stocks have been beaten down so far that their current market cap doesn't really reflect the position they should be in, and when they get ready to move, at least some of the funds won't have any trouble finding shares to buy. <> I agreed at the time and still do. Even though "N" is broadly defined in the book, it's generally been very narrowly defined by CS practitioners. This doesn't mean that one should fill one's portfolio with these kinds of stocks, but O'N has recommended similar stocks in the past, so I don't think it's a stretch to have at least one or two in a diversified portfolio, earnings or no earnings. For a number of years now, many if not most stocks have risen on the anticipation of earnings rather than the fact of earnings, one reason why they plummet so badly when the anticipated earnings don't come through and why they often don't respond as expected when the earnings do come through. This is another aspect of CS that I'm going to have to puzzle out in the coming season. Perhaps O'N will provide some answers in his series? - --Db _________________________________________________________ DO YOU YAHOO!? Get your free @yahoo.com address at http://mail.yahoo.com - - ------------------------------ Date: Wed, 26 Aug 1998 08:23:11 -0700 (PDT) From: dbphoenix Subject: [CANSLIM] Group Strength, FWIW Only a handful of the groups I follow remain above their 50 and 200d MAs. Mainframes Mini-Micros Local Networks (sitting right on its 50) Diversified Drugs Cable TV Drug Stores Cellular Note also that several of these groups are very small, so the chart picture can be due to the performance of only one stock. CVC is a possibility in Cable TV if we follow the usual cycle of entertainment/leisure stock outperformance at this stage. The surrogates I've created for the more important groups are better-looking, tracking as they do only the leaders. However, in a market environment such as this, these pictures can be misleading. I'm using them only as an early warning system in the event of breakdown. - --Db _________________________________________________________ DO YOU YAHOO!? Get your free @yahoo.com address at http://mail.yahoo.com - - ------------------------------ Date: Wed, 26 Aug 1998 11:15:19 -0500 (CDT) From: mckeener@ix.netcom.com Subject: [CANSLIM] Re: RUT revisited Brian, You wrote: . What is Spiders? Pardon my ignorance. Regards, Mary Keener - - ------------------------------ Date: Wed, 26 Aug 1998 09:30:35 -0700 (PDT) From: xchen@raptor.mti.sgi.com (Xiang Chen) Subject: Re: [CANSLIM] Re: RUT revisited Mary, SPY is the symbol for S&P500, which can be traded as regular stocks, and one spider means a share of SPY. The following words comes to us from mckeener@ix.netcom.com: > Brian, > > You wrote: . > > What is Spiders? Pardon my ignorance. > > Regards, > Mary Keener > > > > > - > - -Xiang - - ------------------------------ Date: Wed, 26 Aug 1998 11:38:30 -0500 (CDT) From: mckeener@ix.netcom.com Subject: [CANSLIM] Some random thoughts (noise) on "M" Tom, You wrote: Kindly explain "ADRs". Thanks, Mary Keener - - ------------------------------ Date: Wed, 26 Aug 1998 20:04:14 +0200 From: Johan Van Houtven Subject: [CANSLIM] Watch list Someone emailed me and asked if I had something useful to say besides psychological bull. He/she said it would be much more benefical for him/her when I would post my watch list, which I probably did not have he/she continued. Well, how can ignore such a friendly and elegant request? ;^) Watch list per 23/08: Warning: A lot of non-CANSLIM stocks there!! So CANSLIM purists, don't waste your valuable time. Symbol Description EPS RS A/D GRS UTCI UNIROYAL TECH CORP 75 97 A 20 CHEMICALS-PLASTICS UMG MEDIAONE GROUP INC 23 98 A 92 TELECOMMUNICATIONS-SVCS LDMK LANDMARK SYSTEMS CORP 75 94 A 89 COMPUTER SOFTWR-ENTERPSE PRBZ SPLS STAPLES INC 99 97 B 87 RETAIL/WHLSE OFFICE SUPL VRTS VERITAS SOFTWARE CORP 98 98 B 89 COMPUTER SOFTWR-ENTERPSE VTSS VITESSE SEMICONDUCTOR 97 94 B 41 ELEC-SEMICONDUCTOR MFG YHOO YAHOO! CORP 75 99 B 99 COMPUTER SOFTWR-INTERNET AMZN AMAZON.COM INC 1 99 A 99 COMPUTER SOFTWR-INTERNET MSPG MINDSPRING ENTERPRISES 75 99 A 99 COMPUTER SOFTWR-INTERNET ELNK EARTHLINK NETWORK 40 99 B 99 COMPUTER SOFTWR-INTERNET WAG WALGREEN COMPANY 83 95 A 92 RETAIL-DRUG STORES NSPR INSPIRE INSURANCE SOLTNS 69 97 B 96 COMML SERVICES-MISC TSFW T S I INTL SOFTWARE LTD 98 99 B 30.00 89 COMPUTER SOFTWR-ENTERPSE FORSF FORSOFT LTD 75 94 B 89 COMPUTER SOFTWR-ENTERPSE CSCO CISCO SYSTEMS INC 96 97 B 89 COMPUTER-LOCAL NETWORKS EMC E M C CORP MASS 94 98 B 70 COMPUTER-MEMORY DEVICES SEIC S E I INVESTMENTS CO 95 97 A 91 COMPUTER-SERVICES ATI AIRTOUCH COMMUNICATIONS 98 96 C 98 TELECOMMUNCTNS-CELLULR Johan Van Houtven / CLICK! N.V. - - ------------------------------ Date: Wed, 26 Aug 1998 14:22:27 -0400 From: Craig Griffin Subject: [CANSLIM] Leadership It does look like the leaders crack last. This may not be very well worded or very clear - but I have a conceptual view that I want to make a stab at sharing with you ... O'Neil says that at the beginning of a bull market you might start with 4 to 8 stocks. He also implies that you will be selling and buying some as stops get hit and targets get met, keeping 4-8 stocks overall. He says as the bull market gets old, you will find yourself putting your money more and more into 2 or 3 stocks that show themselves to be the true leaders (ie. you will sell the "bottle rockets" and 3rd stage base failures along the way). This means that you will need to be wise enough to hold and add to your positions in such stocks as Dell and Cisco (leaders in this particular cycle). He says that at the end of the bull market you will have all of your money in perhaps only one or two stocks. (Remember also that through each corrective phase you will have sold a stock or two with each sell signal - holding on to the ones that held up best). My premise is that if all of this had worked out for a mythical "Canslim Master", he would probably be in only one or two stocks today - take your pick from DELL, CSCO, AOL, MSFT, and maybe ATI, YHOO, AMZN, CPWR, probably a few others (suggestions welcome). He would then be selling a fourth to a half of his only stock with today's sell signal - assuming a close below 1785 - (or maybe a half to all of one of two stocks - the weakest one). He would be in no particular hurry or panic. And would probably already be in 25% to 75% cash. - ------ Of course now that I have called today a likely "sell signal" the market will reverse today on 750+ million shares and give us a climax bottom :) (we can only hope). Actually, I doubt it, although a flat close would not surprise me and hence there would be no additional sell signal. There seem to be a couple of differences between the current "correction" environment and the last couple (as best I can remember): 1) the market internals seem worse (advance/decline, new highs/new lows, % of stocks below their 50dma, etc.), 2) there does not seem to be any capitulation (yet) - no really serious down volume that shows people are scared. Instead the volume is fairly light, both on up days and down days as we continue to work our way lower (remember that O'Neil says in HTMMIS that bear markets often fool people with low volume selloffs). An aside --- (A thin reed in the wind ... on the misc.invest.stocks newsgroup - there is almost nobody calling for a crash. Normally, when the market pulls back at all, the nuts come out of the woodwork and start their "crash warnings". Not so much this time - why? Maybe they all finally gave up and bought some stock - now they don't want it to crash. The final buyers may have capitulated on the upside in the last little market surge! Sort of off the wall, I know, but I detect a definite reduced posting frequency.) ---- The entire market looks sort of like a double top to me with the first top on 4/22 and the second on 7/21 (in the NASDAQ). The little move up from 6/16 to 7/21 felt less like a "new leg of the bull" and more like a "mini climax run", a final sprint before the tired old beast staggered to a halt. As the mantra goes "one day at a time". And I AM CERTAINLY READY TO REVERSE THAT READING OF THE MARKET as soon as it shows a follow through day on the upside. But I suspect we need a capitulation first (and then some improvement in market internals). Or maybe the order will actually be the reverse of that (improvement in internals, then capitulation). Just a few thoughts. As always, contrary opinions welcome. Best regards to all, Craig PS. There will always be some up stocks in a down market. Good trades. - - ------------------------------ Date: Wed, 26 Aug 1998 11:26:30 -0700 (PDT) From: dbphoenix Subject: Re: [CANSLIM] Watch list <> I assume he/she will be offering his/her watch list as well. If not, perhaps he/she would be interested in sending you a check and subscribing to your newsletter :) - --Db _________________________________________________________ DO YOU YAHOO!? Get your free @yahoo.com address at http://mail.yahoo.com - - ------------------------------ End of canslim-digest V2 #368 ***************************** 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.