RE: offlist--Re: [CANSLIM] Q: Accelerating growth

From: Fanus <fanus13@yahoo.com>
Subject: RE: offlist--Re: [CANSLIM] Q: Accelerating growth
Date: Thu, 2 May 2002 14:04:13 -0700 (PDT)
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Why do you need the second derivative of growth to be
positive? This isn't what the definition for
acceleration say. The definition just say you need to
have change of velocity. With a 27 change one time and
22 the next, you do have change of velocity and thus
by definition, acceleration.

Since this is way off topic, I am not going to argue
about this any further. Read the explanation on the
site below and hopefully the light will go on for you
also. Pay especially attention to the sentence
stating:
"Whenever an object's velocity is changing, that
object is said to be accelerating; that object has an
acceleration." Object in this case is growth. Note it
doesn't say velocity should be a bigger number
everytime. Just that it need to change.

http://www.physicsclassroom.com/Class/1DKin/U1L1e.html






- --- Mike Gibbons <mikegibbons@proactech.com> wrote:
> Hi Fanus,
> 
> We agree on your vehicle analogy: velocity is rate
> of change of distance and
> acceleration is rate of change of rate of change of
> distance. The underlying
> quantity being measured is distance.
> 
> However if growth is the underlying quantity to be
> measured, then we have
> velocity is rate of change of growth and
> acceleration is rate of change of
> rate of change of growth.
> 
> For (positively) accelerating growth we need the
> second derivative of growth
> to be positive.
> 
> Aloha,
> 
> Mike Gibbons
> Proactive Technologies, LLC
> http://www.proactech.com
> 
> 
> -----Original Message-----
> From: owner-canslim@lists.xmission.com
> [mailto:owner-canslim@lists.xmission.com]On Behalf
> Of Fanus
> Sent: Thursday, May 02, 2002 10:20 AM
> To: canslim@lists.xmission.com
> Subject: RE: offlist--Re: [CANSLIM] Q: Accelerating
> growth
> 
> 
> Mike
> 
> Here is my take on it.
> 
> Acceleration = rate of change of velocity.
> In other words, something accelerates if it is
> changing its velocity. (notice the definition
> doesn't
> say velocity should be higher each time. It just say
> there should be a change in velocity)
> 
> To use your example below. 8% to 35% to 57%.  From
> 8%
> to 35% the velocity change was  27% upwards. It
> accellerating from 8% to 35% because it changed the
> velocity.  Next quarter the velocity changed again
> with 22% upwards. So, by definition since the
> velocity
> changed, it accelerated once again.
> 
> Was the velocity less the 2nd quarter than the
> first?
> Yes.  But by definition that doesn't matter, since
> velocity changed and this is what aceleration is:
> Change in velocity in the same direction.  So there
> was acceleration even though velocity was less.  As
> long as velocity change you have acceleration.
> 
> Another example.  Driving a car at 10mph. 
> Accellerate
> to 20mph. Change of velocity was 10. If you increase
> your speed now to 25mph, you still accelerated even
> though velocity change was only 5 this time. If you
> didn't accelerate to get to 25mph, how did you get
> there then?
> 
> - Fanus
> 
> --- Mike Gibbons <mikegibbons@proactech.com> wrote:
> > I think you meant
> >
> > velocity = rate of change of distance + direction
> > acceleration = rate of change of velocity
> >
> > So, the underlying quantity being measured is
> sales
> > (equivalent to distance)
> > growth in sales per quarter is equivalent to
> > velocity
> > rate of change of growth per quarter is
> acceleration
> > of growth.
> >
> > Aloha,
> >
> > Mike Gibbons
> > Proactive Technologies, LLC
> > http://www.proactech.com
> >   -----Original Message-----
> >   From: owner-canslim@lists.xmission.com
> > [mailto:owner-canslim@lists.xmission.com]On Behalf
> > Of Katherine Malm
> >   Sent: Thursday, May 02, 2002 9:34 AM
> >   To: canslim@lists.xmission.com
> >   Subject: offlist--Re: [CANSLIM] Q: Accelerating
> > growth
> >
> >
> >   I might be all wrong here, but I think what
> you've
> > calculated is velocity
> > rather than acceleration.
> >
> >   Acceleration = rate of change
> >   Velocity = rate of change of the rate of change
> +
> > direction
> >
> >   Katherine
> >     ----- Original Message -----
> >     From: Mike Gibbons
> >     To: canslim@lists.xmission.com
> >     Sent: Thursday, May 02, 2002 2:24 PM
> >     Subject: [CANSLIM] Q: Accelerating growth
> >
> >
> >     I've often seen WON and IBD refer to the need
> > for "accelerating growth".
> >     Strictly speaking, that means that the *rate
> of
> > change* of growth should
> > be
> >     positive.
> >
> >     In yesterday's Investor's Corner they said of
> > PHA, "At the time,
> > earnings
> >     growth was accelerating (8% to 35% to 57%)".
> So
> > the change in growth was
> >     from 8% to 35% (27%) to 35% to 57% (22%). So
> the
> > *rate of change* of
> > growth
> >     was 22 - 27 -> -5. That is, growth was
> > decelerating not accelerating
> >
> >     Now as a physics major, I may be too picky,
> but
> > I believe that language
> >     should be used correctly or it loses its
> value.
> > It seems to me that what
> >     they mean is "earnings growth was increasing".
> >
> >     In that case the WON rule that says that
> "sales
> > growth should be
> >     accelerating" needs to be restated to "sales
> > growth should be
> > increasing".
> >
> >     Aloha,
> >
> >     Mike Gibbons
> >     Proactive Technologies, LLC
> >     http://www.proactech.com
> >
> >
> >     -----Original Message-----
> >     From: owner-canslim@lists.xmission.com
> >     [mailto:owner-canslim@lists.xmission.com]On
> > Behalf Of Warren Keuffel
> >     Sent: Thursday, May 02, 2002 7:55 AM
> >     To: canslim@lists.xmission.com
> >     Subject: Re: [CANSLIM] IBD's Industry Group
> and
> > Ticker Symbol Index
> >
> >
> >     If you intend to pursue a group-oriented
> > strategy, and you intend to use
> >     IBD's 197 industry group tables, the book is
> > indispensible because it's
> >     not always obvious which companies are
> assigned
> > to which industry
> >     groups. I'm using Vector Vest now, which has
> its
> > own industry groupings,
> >     so I no longer buy the IBD books.
> >
> >     HTH.
> >     Warren
> >
> >     rolf hertenstein wrote:
> >
> >     >Hello all -
> >     >
> >     >Could anyone who has used this guide in the
> > past
> >     >tell me if they
> >     >indeed found it useful?  I'll likely wait for
> > the
> >     >next issue due in June
> >     >in any case.
> 
=== message truncated ===


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