RE: [CANSLIM] Fundamental Philosophies

From: "Fred Richards" <ffradrich@attbi.com>
Subject: RE: [CANSLIM] Fundamental Philosophies
Date: Fri, 6 Dec 2002 08:41:47 -0600

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The key is to balance risk with reward.  In the case of PECS, it has made
money for some investors on several occasions. But it did require one to use
either a good alert system or hard trailing stops to protect those gains.

The question is simply this:  Did you set your stop-loss or Action Point to
keep those losses as minimal as possible.  O'Neil suggests 6% below cost in
most cases as the initial Action Point.

- -----Original Message-----
From: owner-canslim@lists.xmission.com
[mailto:owner-canslim@lists.xmission.com]On Behalf Of Davellil5@aol.com
Sent: Friday, December 06, 2002 8:09 AM
To: cjcorley@hiwaay.net; canslim@lists.xmission.com
Subject: Re: [CANSLIM] Fundamental Philosophies


One of our members has said that a stock may be selected for purchase when
there is a preponderance of evidence showing conformance with CANSLIM
criteria.  This makes sense because it is very rare for a stock to conform
100%.

Nevertheless, there are  some go-nogo conditions.  PECS provides us with a
good example of one of those conditions.  PECS has displayed great growth.
EPS growth this year is expected to be 51%.  However, EPS growth for next
year is projected to be only 22%, less than half as much.  There's nothing
shabby about 22% growth, but coming after 51%, it forces us to wonder
whether
the price of the stock already reflects all the prospects for the Company.
Maybe that's why PECS broke out on high volume November 25th, only to
collapse on high volume December 2nd, and is now flirting with its 50DMA.

I've been burned by stocks that I bought because of great growth records in
spite of much slower future growth projections.  So, now, that is a go-nogo
condition for me.   Maybe I'll miss a few "comers", but I just don't want to
take that risk again.

It would be useful for us CANSLIM-ers to discuss  strict go-nogo conditions
in these e- mails.  Does anyone else have them?

Regards to all, Dave









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