Neglect is a good strategy
Expanding from the theme of 'Virgin' , I have over the years experimented with various ways of finding neglected stocks. The entire area of neglect is conceptually based on contrary thinking or long term mean reversion or value focus.
While the 'Virgin' strategy is focused on stocks which have not rallied in their entire lifespan, the focus behind my 'Neglect' strategy is on stocks which might have rallied previously some years ago and now are out of favor. In 'Neglect' I am primarily looking for seller washout.
Now the simplest way to find these kind of neglected stocks is to find the number of negative days to positive days ratio over a long period of time. After experimenting with various time frames, I look at 4 years negative to positive days ratio.
So the software basically finds out for all stocks number of positive days to negative days ratio for 4 years and ranks the stock. I look at the ratio of less than 25% positive days as the ideal 'Neglect' candidates. Some of these stocks just get delisted, but some survive, turn around and start rallying.
To time entries again I look for combination of factors like :
1 They should make 30% plus move from 260 days low (100 * ((C + .01) - ( MINC260 + .01)) / (MINC260 + .01))>=30
2 Should meet liquidity condition ( AVGC20 * AVGV20 >= 2500)
3 One day 4% plus breakout. ( 100 * (C - C1) / C1) >= 4 AND V >= 1000 AND V > V1
Such stocks also have high success rate in their rallies as the sellers in them are washed out and the reason they start rallying in most cases is because of some improvement or turnaround in their business.
This strategy is again a variation of 'Virgins'. One of the things I have found after studying stocks which make 100% plus move in a year over years is that prior to their move they are essentially neglected. As I have said many times before previous neglect is very good for future returns. I have experimented with many other ways to quantify and find neglect and use 2-3 other ways to define neglect. All these strategies I club under Virgin/ Neglect label.
So if you want to find and trade stocks likely to make significant moves early in their price appreciation cycle you must find various ways of quantifying neglect.
Note: All such strategies require building your own databases or software or your trading software should have the capability to do such scans. I have got so many emails me asking how to do 'Virgin' scan in TC2000 or most commercially available software. Most of them are built for simple and popular things. You may not be able to do these things in them.
If you are convinced of the logic behind a idea, you can always build or find a software to do it. I first built my software using Excel.Where there is a will, there is a way.
While the 'Virgin' strategy is focused on stocks which have not rallied in their entire lifespan, the focus behind my 'Neglect' strategy is on stocks which might have rallied previously some years ago and now are out of favor. In 'Neglect' I am primarily looking for seller washout.
Now the simplest way to find these kind of neglected stocks is to find the number of negative days to positive days ratio over a long period of time. After experimenting with various time frames, I look at 4 years negative to positive days ratio.
So the software basically finds out for all stocks number of positive days to negative days ratio for 4 years and ranks the stock. I look at the ratio of less than 25% positive days as the ideal 'Neglect' candidates. Some of these stocks just get delisted, but some survive, turn around and start rallying.
To time entries again I look for combination of factors like :
1 They should make 30% plus move from 260 days low (100 * ((C + .01) - ( MINC260 + .01)) / (MINC260 + .01))>=30
2 Should meet liquidity condition ( AVGC20 * AVGV20 >= 2500)
3 One day 4% plus breakout. ( 100 * (C - C1) / C1) >= 4 AND V >= 1000 AND V > V1
Such stocks also have high success rate in their rallies as the sellers in them are washed out and the reason they start rallying in most cases is because of some improvement or turnaround in their business.
This strategy is again a variation of 'Virgins'. One of the things I have found after studying stocks which make 100% plus move in a year over years is that prior to their move they are essentially neglected. As I have said many times before previous neglect is very good for future returns. I have experimented with many other ways to quantify and find neglect and use 2-3 other ways to define neglect. All these strategies I club under Virgin/ Neglect label.
So if you want to find and trade stocks likely to make significant moves early in their price appreciation cycle you must find various ways of quantifying neglect.
Note: All such strategies require building your own databases or software or your trading software should have the capability to do such scans. I have got so many emails me asking how to do 'Virgin' scan in TC2000 or most commercially available software. Most of them are built for simple and popular things. You may not be able to do these things in them.
If you are convinced of the logic behind a idea, you can always build or find a software to do it. I first built my software using Excel.Where there is a will, there is a way.
Are you serious about your trading?
If you are serious about your trading and want to build an enduring edge the Stockbee Member site might help you. Members tell me they have tried lot of things before coming to my site and it has offered them the most extensive and detailed methods to swing and position trade.
It is only for those who want to develop their own self sufficient trading method. It is not a stock picking service. It is service for you to build your own scans and trading method to have your own daily pick based on your method.
Be warned it will take you time to learn to trade. Learning to trade is difficult art and unless you are willing to spend months or years to perfect your strategy and also develop your mental edge you are unlikely to succeed in this game. Unless you understand that no site, no service, and no mentoring is going to work.
Why traders come to stockbee?
The member site is one of the most recommended site for learning to trade by other traders and bloggers. You will see no advertising, no hard marketing, no promotions, no free offers, no affiliate marketing, no incentive to other bloggers to promote the site, no constant twits self promoting the site, no free trial and no tall claims of making you instantly wealthy, and yet the site attracts new members everyday. Members come from all walks of life and all kinds of trading size and trading styles.
You will see that many trading bloggers have been using my market timing methods, scans , stock ranking lists and chart templates. They have developed their own methods based on my methods. Many paid newsletter site recommend my site to their subscriber for learning about trading and market.
Over the years thousands of traders have been members and those who benefited from the learning talk about the site to others or talk about the methods used and that is how new members learn about the site.
What will I learn in the members site?
The members site will give you in depth understanding to develop your own trading method. The emphasis is on making you self sufficient and confident of your own trading method and style.
As a member you will learn the basics of swing trading, momentum investing, growth investing and risk management.
You will learn about Stockbee Trend Intensity Breakouts method that uses momentum based swing trading to find 3 to 5 day swing trades for 8 to 40% profit.
You will learn about Stockbee Episodic Pivots Breakout method which uses Post Earnings Announcement Drift (PEAD) to find stocks that had a game changing earnings and that are likely to rally for 3 months to 12 months.
You will learn about Stockbee Dollar Breakout method that uses momentum, range expansion and swing trading approach to find 5 to 40 dollar moves in high priced stocks.
You will learn about Stockbee Lemonade Strategy for 401k which uses market timing and momentum to invest in 401k. You will get weekly update on how I am using the strategy on our 401k to do allocation decision.
You will learn about Stockbee Market Monitor method for market timing using breadth. It allows you to avoid risky periods in market and allows you to identify market turns. It is used for 401k allocation decisions.
You will learn about Stockbee Double Trouble method to find stock with confirmed upside momentum using anchored momentum and that are likely to continue their up move.
You will learn about Stockbee Night Time is Right Time method to find news catalyst based trade ideas for short term day trade and swing trade.
You will learn about Investor's Business Daily’s IBD 200 list and how it can be used to find swing trading candidates for explosive moves.
You will learn about Telechart 2000 and how to use it effectively to scan for swing and position trade ideas and to set up your 401k strategy.
You will learn about Jesse Livermore Range Breakout, Darvas Box setup, and many other member shared methods.
You will learn how to set up your own scans, select right kind of stocks, how to set up stops, when to enter , when to exit, how much to risk, how to track your trades and all other details about trading. You will learn about developing your own methods and not relying on others for trade ideas.
The site has hundreds of videos and trading methods and variation of methods. Members help each other in developing the methods and share actively their research and finding. A collaborative spirit allows you to get input from others on your trading ideas or problems.
The site gives you opportunity to interact with some of the most successful traders and learn from them about their trading methods. It is a vibrant community with members from different background and experience willing to help each other. The emphasis is on continuous learning and up gradation of market knowledge and setup knowledge. The members range from hedge fund employees, financial advisers, active swing traders, investors and new traders.
If you are looking to develop your own trading strategy the membership site might be for you. You have to be willing to put in the effort to build your own method. There are no silver bullets offered on members site. Every method, every scan, every nuance is detailed and all possible help is offered to design your own method.
Do you have a trial?
If you are just looking for trial you are better off trying thousands of other trading site that offer free trail or one month trial and offer you promise of riches.
It is for those who are ready beyond the trial phase and ready to put serious months or years of efforts to learn to trade on their own. It is for those who want to learn to find their own fish.
The free blog has all the details about the methods I trade and if you go through the posts highlighted in the sidebar you will learn about them.
How can I become a member?
To sign up go to www.stockbee.biz and follow the sign up process. The site uses Paypal for payment processing.
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Are you serious about your trading?
If you are serious about your trading and want to build an enduring edge the Stockbee Member site might help you. Members tell me they have tried lot of things before coming to my site and it has offered them the most extensive and detailed methods to swing and position trade.
It is only for those who want to develop their own self sufficient trading method. It is not a stock picking service. It is service for you to build your own scans and trading method to have your own daily pick based on your method.
Be warned it will take you time to learn to trade. Learning to trade is difficult art and unless you are willing to spend months or years to perfect your strategy and also develop your mental edge you are unlikely to succeed in this game. Unless you understand that no site, no service, and no mentoring is going to work.
Why traders come to stockbee?
The member site is one of the most recommended site for learning to trade by other traders and bloggers. You will see no advertising, no hard marketing, no promotions, no free offers, no affiliate marketing, no incentive to other bloggers to promote the site, no constant twits self promoting the site, no free trial and no tall claims of making you instantly wealthy, and yet the site attracts new members everyday. Members come from all walks of life and all kinds of trading size and trading styles.
You will see that many trading bloggers have been using my market timing methods, scans , stock ranking lists and chart templates. They have developed their own methods based on my methods. Many paid newsletter site recommend my site to their subscriber for learning about trading and market.
Over the years thousands of traders have been members and those who benefited from the learning talk about the site to others or talk about the methods used and that is how new members learn about the site.
What will I learn in the members site?
The members site will give you in depth understanding to develop your own trading method. The emphasis is on making you self sufficient and confident of your own trading method and style.
As a member you will learn the basics of swing trading, momentum investing, growth investing and risk management.
You will learn about Stockbee Trend Intensity Breakouts method that uses momentum based swing trading to find 3 to 5 day swing trades for 8 to 40% profit.
You will learn about Stockbee Episodic Pivots Breakout method which uses Post Earnings Announcement Drift (PEAD) to find stocks that had a game changing earnings and that are likely to rally for 3 months to 12 months.
You will learn about Stockbee Dollar Breakout method that uses momentum, range expansion and swing trading approach to find 5 to 40 dollar moves in high priced stocks.
You will learn about Stockbee Lemonade Strategy for 401k which uses market timing and momentum to invest in 401k. You will get weekly update on how I am using the strategy on our 401k to do allocation decision.
You will learn about Stockbee Market Monitor method for market timing using breadth. It allows you to avoid risky periods in market and allows you to identify market turns. It is used for 401k allocation decisions.
You will learn about Stockbee Double Trouble method to find stock with confirmed upside momentum using anchored momentum and that are likely to continue their up move.
You will learn about Stockbee Night Time is Right Time method to find news catalyst based trade ideas for short term day trade and swing trade.
You will learn about Investor's Business Daily’s IBD 200 list and how it can be used to find swing trading candidates for explosive moves.
You will learn about Telechart 2000 and how to use it effectively to scan for swing and position trade ideas and to set up your 401k strategy.
You will learn about Jesse Livermore Range Breakout, Darvas Box setup, and many other member shared methods.
You will learn how to set up your own scans, select right kind of stocks, how to set up stops, when to enter , when to exit, how much to risk, how to track your trades and all other details about trading. You will learn about developing your own methods and not relying on others for trade ideas.
The site has hundreds of videos and trading methods and variation of methods. Members help each other in developing the methods and share actively their research and finding. A collaborative spirit allows you to get input from others on your trading ideas or problems.
The site gives you opportunity to interact with some of the most successful traders and learn from them about their trading methods. It is a vibrant community with members from different background and experience willing to help each other. The emphasis is on continuous learning and up gradation of market knowledge and setup knowledge. The members range from hedge fund employees, financial advisers, active swing traders, investors and new traders.
If you are looking to develop your own trading strategy the membership site might be for you. You have to be willing to put in the effort to build your own method. There are no silver bullets offered on members site. Every method, every scan, every nuance is detailed and all possible help is offered to design your own method.
Do you have a trial?
If you are just looking for trial you are better off trying thousands of other trading site that offer free trail or one month trial and offer you promise of riches.
It is for those who are ready beyond the trial phase and ready to put serious months or years of efforts to learn to trade on their own. It is for those who want to learn to find their own fish.
The free blog has all the details about the methods I trade and if you go through the posts highlighted in the sidebar you will learn about them.
How can I become a member?
To sign up go to www.stockbee.biz and follow the sign up process. The site uses Paypal for payment processing.
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4 comments:
FFHL for earnings breakout?
Today... Chinese film company
Have not seen the earnings figure yet. I have it on my Episodic Pivot list since pre market.
Hello Mr. Pradeep Bonde,
I am in India and just recently discovered this fabulous blog of yours, which is just superb. I have read your previous postings in this blog also.
On the subject of Neglected Stocks, in 2007 you wrote that "I have experimented with many other ways to quantify and find neglect and use 2-3 other ways to define neglect."
I searched and could not find the other methods to define neglect. Could you please guide me or point to me the right way of mining the data etc.?
Thanks and once again congrats on your good work!
Regds,
Hemanth Kumar, Bangalore
Low float
No rally for 3 years
Low funds holding with less than 30 funds holdings
Low average liquidity for extended period of year or more
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