Re: [CANSLIM] Investor's Corner Puzzlement

From: "Bill Triffet" <btriffet@earthlink.net>
Subject: Re: [CANSLIM] Investor's Corner Puzzlement
Date: Wed, 24 Apr 2002 08:34:27 -0700

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Tom,

I think part of the confusion here for some of us is the added rule of,
"Don't let a profit turn into a loss".

If one had a few failed b/o's and then finally hits one that gets to 15%
quickly, it would stand to reason that they'd like to preserve that gain -
hence the self imposed tight stops. I also found out first hand that on a
fast downwards drop, your 15% trailing stop (hard) can quickly become
17%-18% for us little retail investors.

Still, for me I'm willing to let a stock fall back just to it's breakout
from 15%. I don't like to see it, but hopefully it will give the stock
enough "wiggle room".

- -Bill






- ----- Original Message -----
From: "Tom Worley" <stkguru@bellsouth.net>
To: <canslim@lists.xmission.com>
Sent: Tuesday, April 23, 2002 7:12 PM
Subject: Re: [CANSLIM] Investor's Corner Puzzlement


I have mentioned this before, but will do so again. The methodology taught
to me years ago by WON staffers was that you used an 8% max sell stop at the
time, and from the price, of entry. If / once you were up 15% from your
entry, then you moved your sell stop to a trailing 15% stop from the then
current price. If it continued to perform, you continued, on a daily basis,
to move your sell trailing sell stop up, so that you were always 15% below
the then current price. It was never clarified whether you used intraday, or
closing, price for this.

The idea is simple, the first stage is to preserve capital (8% sell stop).
The next stage is to protect against any actual loss (now up 15%, and
beginning the use of a trailing stop). And the third stage is to permit your
strongest performers to continue higher without shaking you out as they
briefly correct (hence giving them a continuing trailing 15% range).

Tom Worley
stkguru@bellsouth.net
AIM: TexWorley
- ----- Original Message -----
From: Katherine Malm
To: canslim@lists.xmission.com
Sent: Tuesday, April 23, 2002 9:58 PM
Subject: Re: [CANSLIM] Investor's Corner Puzzlement


Hi Harold,

WON only uses the 8% rule at the time of a valid breakout. The pullbacks
referred to in the article are pullbacks within the uptrend...not at the
time of breakout. For example, WON says that stocks that rise 20% or more
within 8 weeks of the breakout are typically very strong and suggests
holding on during the first consolidation. The article today is simply
saying that  if you set hard stops too tightly during the uptrend, you will
likely be shaken out of an otherwise healthy stock that is simply acting
"normally" in its uptrend or will get shaken out on intraday action where
the close is otherwise healthy.

Katherine
  ----- Original Message -----
  From: Harold Josephson
  To: CANSLIM DISCUSSION GROUP (E-mail)
  Sent: Tuesday, April 23, 2002 8:35 PM
  Subject: [CANSLIM] Investor's Corner Puzzlement



  Tuesday's Investor's Corner seemed to illustrate that following the WON
rule of selling when a stock has dropped 8% would have shaken you out of all
of the top 12 winners of the 1997-2000 period.  I am puzzled by the message
here.  Don't follow the WON rule?



  Thanks



  Harold Josephson

  Tel:   323.850.1333

  Fax:  323.512.8968

  hj@hjosephson.com






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