How to beat the market for $1.25 per week revisited- Part1
The idea behind the post is to again get back to the theme of how methods are important and if you apply methodical thinking you can take a core idea and improve on it. Plus to show simple things work, if you put efforts to make them work, rather than flirting from one idea to another.
To start with lets look at IBD 200 from a period of 120 to 90 days ago when the original post was made.
Here are the top 20 by % change.
Here are the bottom 20 by % change.
And here are the top 3 performers with 4% breakout marked in yellow. Red pentagon marker indicates date of entry in IBD 200.
And the bottom 2. (The GEF-B is not really indicative of drop as it has to do with dividends.)
Remember the IBD list in above is only sample for around a 4 weeks. In the meanwhile there have been many more lists and many stocks out of them have gone on to make 50% plus moves after entering the list.
12 comments:
Hi, Pradeep,
I guess you see a possibility of playing IDB200 candidates also for down market. Could you please comment on this?
Thanks,
Siya
Are you talking about shorting. I still remain of the opinion, it is much easier to make money on long side than on short side. Not worth spending time and energy on it.
Pradeep,
Have you backtested this strategy in bull and bear markets ?
Amit
this portfolio based in IBD200 is not doing very well so far. Maybe the stop-loss woould have improved the overall performance, but not sure
http://stockpickr.com/port/Potential-IBD-200-Breakouts/
Amit
I started trading it in bear market. The most severe one.
Semson
I don't think that portfolio follows any rules I mentioned.
Pradeep,
What kind of returns did you average on this portfolio if one may ask ?
Did you get stopped out frequently ? How tight stops did you have during bear markets?
Did you experience significantly better results in a bull run with this strategy ?
I do not disclose returns.
My stops have been same for many years (2 days low before entry day, initial time stop of 5 days after 20% trail).No change in stops during bear markets.
Obviously.
ok,
How often did you get stopped ? Say 1 in 4 times/more/less ? any numbers ?
Approximately 30% of the time. But because of time stop my loss on most stopped out cases is much lower than if stop was taken out at 2 days low.
For those who compare the lists to look for new addtions, checkout conditional formatting in excel:
http://j-walk.com/ss/excel/usertips/tip073.htm
For clarification:
1. Sort by Float first.
2. Then sort that list by 65 day growth lowest to highest?
or is it the other way around?
thanks,
Dan
After sorting by 65 days take those with less than 10% growth.
On that to further reduce the choice sort by float.
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