June 2, Reducing the IBD 200 list to few opportunities

Lets look at this weeks To identify the best and handful of opportunities with best potential, here is what I do.
  • The total list has 200 stocks.
  • Sorted it by 65 days growth with one day offset using Telechart scan : 100 * (C1 - C66) / C66
  • Selected the stock which had less than 10 % growth in 65 days.
  • That gives 8 stocks.

ACL,Alcon Inc (Google  Yahoo  Earnings  Chart
AOB,American Oriental Bioengineering Inc (Google  Yahoo  Earnings  Chart
BLUD,Immucor Inc (Google  Yahoo  Earnings  Chart
COL,Rockwell Collins Inc (Google  Yahoo  Earnings  Chart
GES,Guess? Incorporated (Google  Yahoo  Earnings  Chart
HURN,Huron Consulting Group Inc (Google  Yahoo  Earnings  Chart
ICE,Intercontinental Exchange Inc (Google  Yahoo  Earnings  Chart
MBT,Mobile Telesys Ojsc Ads (Google  Yahoo  Earnings  Chart

Now this list can further be reduced based on sector action or whether the stock is in early breakout phase or late breakout phase.

I do not see any opportunity in the list for this week. At best GES looks interesting, but it is moving up without breakout. GES has had many quarters of good earnings and number of stocks in the sector are breaking out.So I will still be watching last weeks SSW. SSW is a shipping container chartering service. Shipping sector is currently in favor. MICC from last week had a nice breakout.

As market rally moves further, you get less and less number of stocks meeting all your criteria. In early stages of overall market rally, you get more stocks meeting your criteria. If there is few days or weeks correction, again you find more candidates. That is the way you want it anyway, more opportunities at start of rally and diminished opportunities as market moves higher. So those starting to trade IBD 200 will find waiting till market correction is your best bet.


chan said...

Hi Pradeep,

You have nice blog going on here.
Thanks for sharing your wisdom.

Why would you exclude MBT and ICE from this IBD200 shortlist? Telecom sector is on fire with almost everything breaking out including MBT last week. And ICE is also in hot exchange sector with BOT and ISE takeovers. It also is indirect play for energy and commodities.

Pradeep Bonde said...

MBT had 4% plus breakout last week, but no follow through, it was followed by selling.
ICE, too much event risk.It is volatile based on news flow. Plus acquisitions are mostly bearish.

Art said...

When I create an EasyScan with your 65d growth scan, where would I set the Condition Type-List Rank- to arrive at those 8 stocks please?


Art said...

I got it. Your scan wants List Rank 4-1. My apologizes for cluttering the list.


Pradeep Bonde said...

My scan wants value of less than 10% not ranks.

Siya said...

How do I filter stocks based on sector action?
I guess the followings:
- rank sectors for 65 day performance see where this sector is positioned.
- See if this sector is moving up compared to last week ranking.
- See stocks in this sector if they've 4% breakouts.

Do you look at Industry or Sub-Industry in TC2007 for this purpose?

Can you please provide your guidance.


Pradeep Bonde said...

Remember the Composite rating in IBD 200, gives larger weight to Sector relative strength, so the sector strength is baked in. The issue becomes at top when higher relative strength sector reverse, they still have higher ratings.
In TC2007 if you want to replicate the IBD sector ratings, you have to modify the Relative strength formula and use only half year instead of one year to rank sector. Plus when taking sector taking top 30 to 40 sector is better .
Easiest way to do sectors is to look at IBD Stock Checkup and take B plus rating on group.

But overall individual stock action is best indicator. Look at AAPL, every single stock in that sector is on deathbed or in trouble for last so many years while AAPL has gone up 10 times or more.

bowler2005 said...

Hi Pradeep,
Nice Blog. Learned a lot.
Could you please let me know how you imported IBD200 into TC2007. I could not find a excel sheet for IBD200 at investors.com

Siya said...

To replicate IBD sector rating in TC2007, is the following pcf appropriate?
2 * (C * 100 / C65) + (C * 100 / C130)

Further, am I right that I need to select Hemscott Industry Groups (having 239 entries) and sort by above pcf to get top 30-40 groups?


Pradeep Bonde said...

In IBD forum a excel spreadsheet is posted by someone under Indutsry Groups on Saturday.
If you want it on Thursday, you have to data enter it.


Yes and yes. The groups will not match IBD group in some cases.
You can also try an alternative Rel Strength scan .

( (2 * C * 100 / C5) + (2 * C * 100 / C25) + (2 * C * 100 / C40) + ( C
* 100 / C65) + ( C * 100 / C130) ) / 8

You will get better results on sector. Because on sector you need faster signal to show trend change.

bowler2005 said...

Thanks Pradeep.

Mike said...


Thank you again for all of the information. I have a question concerning 65 day growth filter. Is it measured by 65 trading days or 65 calendar days. Thanks again.


Susan said...

Mike, it's 65 trading days.