Tools From The Patient Fisherman
The core skill in trading or the edge is in both selecting stocks and timing them. There are two basic ways to gain edge. One is stock or vehicle selection and the other is timing entry or exit on those vehicles.
The Patient Fisherman lists are primarily vehicle selection list. They rank stocks as attractive for trading. Unlike scanners which use fix cut offs, ranking method that we use has more information. What ranking does is it gives you relative importance of the stock. For example if you look at the Top Stock Ranked by Momentum and Value then the number one ranked stock is better than number two and number two is better than number three and so on. The ranking prioritizes the ideas. So if you have a choice you would select higher ranked opportunity first.
What these lists do is reduce the 7000 stock universe to 50 opportunities ranked in terms of attractiveness. At some stage we will further refine the lists to give you only 25 or less than 25 opportunities in terms of priority.
These lists do not offer you timing advise. A best of the stock if you enter or exit at wrong time is not going to make you money. For that timing becomes critical. Every stock has up trends and down trends. Timing techniques allows you to identify such periods and determine when to enter or exit. Your timing skills and strategies will determine the amount of returns which you can get from these 50 stock list.
When it comes to timing strategies the 4% breakout along with associated conditions are timing signal for these stocks that can be used currently. We are working on the timing part of these lists. The timing part for this will be based on Stockbee buy and sell zone ratings. The buy and sell rating zones will tell you when it is time to enter and exit on these stocks. The work on that is going on currently and at some stage those rating will be introduced.
Some of you have asked how are these lists derived and can they be replicated in Telechart or Stockfinder. The answer is no. These lists are derived using a composite factors for which all information may not be available in Telechart. If you want to do something like this for yourself you need to develop it yourself.
These lists and method is being developed by dcummiskey for his own personal trading because he has busy life and career and wants to have a way to trade in his 401k and other accounts along with his ongoing job and career. I just offered him hints and pointers, he developed it on his own.
If you are serious about your own trading and want to develop your own method either for 401k or for stock trading then you have to work out your own method. That is when you will have significant confidence in your methods and in trading. That will also improve your self efficacy beliefs.
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