Go to Jeff Salisbury LWGate Home Page.From: "Gene Ricci" <genr@swbell.net>
Subject: Re: [CANSLIM] many newbie questions about Industry Groups
Date: Wed, 19 Mar 2003 10:24:47 -0600
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This is a multi-part message in MIME format. - ------=_NextPart_000_034E_01C2EE01.C4040150 Content-Type: text/plain; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable Duane, I have always preferred the 'tops-down' approach because it = reduces the size of my watchlist to a manageable size. Here are some = recent findings: 1. Attended a 2-day VectorVest investment seminar (3/8-3/9) and watched = while they did a scan of the entire VectorVest data base using one of = the 'canned' strategies... they performed a short backtest to see = appreciation of the top 10 (returned from the scan) and got XX% return. = They then added a criteria to only scan stocks that were only in the top = XX industries and then performed the same backtest and in all cases = (about 5 demos) the results were significantly higher (I'm still = deciphering my notes so don't have the exact numbers at my finger tips). 2. Have several friends that purchased the CNBC investment course = ($3500) where they tout 'tops-down'. I've watched the tapes and can't = help but smile when the instructor shows them how to use the process to = find stocks to trade. The process being: market direction; industry = Groups: stock selection. He CAUTIONS against a 'bottoms-up' approach = because he doesn't want them to find good stocks with bad industry = ratings. He said "avoid temptation". CNBC teaches them how to find = industries just coming into favor (red to yellow to green) for longs = and/or for the bearish outlook (green to yellow to red). 3. As you can see by the following, HGSI has some recent data supporting = selecting stocks from strong industry groups: ****************************************************** Market Report - 03/15/03 Brought to you by Industry Monitors, Inc. Hi Gene, Ron Brown is chuckling this week. Find out why. This week Ron uses the Weekend Review filter to find promising stocks. Here is a brief review of his findings and analysis: Of the 41 stocks, 19 have a green group rank, 11 have a yellow group rank, 10 have a red group rank. The green group index gained 5.8 percent for the week, the yellow group index gained 4.1 percent for the week, and the red group index gained only 2 percent for the week. This indicates that when the market turns up on volume, money flows into the strongest stocks in the strongest groups before it flows into the strongest stocks in the weakest groups. The lesson is to buy good quality stocks in strong groups during a market rally. Read more of Ron Brown's FREE weekly market report with charts: http://www.highgrowthstock.com/WeeklyReports/rpt/20030315.pdf Hope that this was of some value, Gene =20 ----- Original Message -----=20 From: Duane Runnels=20 To: canslim@lists.xmission.com=20 Sent: Wednesday, March 19, 2003 9:41 AM Subject: [CANSLIM] many newbie questions about Industry Groups I'm trying to figure out the importance of Industry Groups. WON says = pick a leader in a top 20% group and that half of a stock's performance = is related to its group. WON also says pick from the top 6 groups = making new highs. (IBD Rule #11). =20 Is it a valid screen then to start by looking only at the top 40 = groups, find the leaders, and then check for RS and EPS, etc? There doesn't seem to be a lot of discussion here about industry = groups, although there have been several posts recently. Do you = consider group strength then as a secondary factor? It is not part of = CANSLIM is it? Some of you even invest only in certain sectors. =20 I particularly liked Katherine's posts regarding researching groups = showing new rising strength. I watch the Industry Groups table and the = list changes dramatically from one month to the next. Is this a bear = aberation or normal? =20 =20 How much of a group's strength is dependent on one stock's = performance? If this is the case, isn't group performance a misnomer? = Also I see that certain groups have a lot of new highs, but also a lot = of new lows. Is this just a reflection of today's market conditions? In short, how much attention do you pay to the industry group and = why?THANKS. - ------=_NextPart_000_034E_01C2EE01.C4040150 Content-Type: text/html; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable <!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN"> <HTML xmlns:o =3D "urn:schemas-microsoft-com:office:office"><HEAD> <META http-equiv=3DContent-Type content=3D"text/html; = charset=3Diso-8859-1"> <META content=3D"MSHTML 5.50.4916.2300" name=3DGENERATOR> <STYLE></STYLE> </HEAD> <BODY bgColor=3D#fffcf0> <DIV><FONT face=3D"Comic Sans MS">Duane, I have always preferred the = 'tops-down'=20 approach because it reduces the size of my watchlist to a manageable = size.=20 </FONT><FONT face=3D"Comic Sans MS">Here are some recent = findings:</FONT></DIV> <DIV><FONT face=3D"Comic Sans MS"></FONT> </DIV> <DIV><FONT face=3D"Comic Sans MS">1. Attended a 2-day VectorVest = investment=20 seminar (3/8-3/9) and watched while they did a scan of the entire = VectorVest=20 data base using one of the 'canned' strategies... they performed a short = backtest to see appreciation of the top 10 (returned from the scan) and = got XX%=20 return. They then added a criteria to only scan stocks that were only in = the top=20 XX industries and then performed the same backtest and in all = cases=20 (about 5 demos) the results were significantly higher (I'm still = deciphering my=20 notes so don't have the exact numbers at my finger = tips).</FONT></DIV> <DIV><FONT face=3D"Comic Sans MS">2. Have several friends that purchased = the CNBC=20 investment course ($3500) where they tout 'tops-down'. I've watched the = tapes=20 and can't help but smile when the instructor shows them how to use = the=20 process to find stocks to trade. The process being: market = direction;=20 industry Groups: stock selection. He CAUTIONS against a 'bottoms-up' = approach=20 because he doesn't want them to find good stocks with bad industry = ratings. He=20 said "avoid temptation". CNBC teaches them how to find industries = just=20 coming into favor (red to yellow to green) for longs and/or for the = bearish=20 outlook (green to yellow to red).</FONT></DIV> <DIV><FONT face=3D"Comic Sans MS">3. As you can see by the following, = HGSI has=20 some recent data supporting selecting stocks from strong = industry=20 groups:</FONT></DIV> <DIV><FONT face=3D"Comic Sans MS"></FONT> </DIV> <DIV><FONT face=3D"Comic Sans MS"></FONT> </DIV> <DIV><FONT face=3D"Comic Sans MS"><FONT=20 face=3D"Times New = Roman">******************************************************<BR><BR>Mark= et=20 Report - 03/15/03<BR>Brought to you by Industry Monitors, = Inc.<BR><BR><BR>Hi=20 Gene,<BR><BR>Ron Brown is chuckling this week. Find out = why.<BR><BR>This=20 week Ron uses the Weekend Review filter to find promising = stocks.<BR>Here is a=20 brief review of his findings and analysis:<BR><BR>Of the 41 stocks, 19 = have a=20 green group rank, 11 have a yellow group<BR>rank, 10 have a red group=20 rank.<BR><BR>The green group index gained 5.8 percent for the week, the = yellow=20 group<BR>index gained 4.1 percent for the week, and the red group index=20 gained<BR>only 2 percent for the week. This indicates that when = the market=20 turns<BR>up on volume, money flows into the strongest stocks in the=20 strongest<BR>groups before it flows into the strongest stocks in the = weakest=20 groups.<BR>The lesson is to buy good quality stocks in strong groups = during=20 a<BR>market rally.<BR><BR><BR>Read more of Ron Brown's FREE weekly = market report=20 with charts:<BR></FONT><A=20 href=3D"http://www.highgrowthstock.com/WeeklyReports/rpt/20030315.pdf"><F= ONT=20 face=3D"Times New = Roman">http://www.highgrowthstock.com/WeeklyReports/rpt/20030315.pdf</FON= T></A></FONT></DIV> <DIV><FONT face=3D"Comic Sans MS"></FONT> </DIV> <DIV><FONT face=3D"Comic Sans MS">Hope that this was of some = value,</FONT></DIV> <DIV><FONT face=3D"Comic Sans MS">Gene<BR></DIV></FONT> <DIV> </DIV> <BLOCKQUOTE dir=3Dltr=20 style=3D"PADDING-RIGHT: 0px; PADDING-LEFT: 5px; MARGIN-LEFT: 5px; = BORDER-LEFT: #000000 2px solid; MARGIN-RIGHT: 0px"> <DIV style=3D"FONT: 10pt arial">----- Original Message ----- </DIV> <DIV=20 style=3D"BACKGROUND: #e4e4e4; FONT: 10pt arial; font-color: = black"><B>From:</B>=20 <A title=3Ddrunnels@kiva.net href=3D"mailto:drunnels@kiva.net">Duane = Runnels</A>=20 </DIV> <DIV style=3D"FONT: 10pt arial"><B>To:</B> <A = title=3Dcanslim@lists.xmission.com=20 = href=3D"mailto:canslim@lists.xmission.com">canslim@lists.xmission.com</A>= </DIV> <DIV style=3D"FONT: 10pt arial"><B>Sent:</B> Wednesday, March 19, 2003 = 9:41=20 AM</DIV> <DIV style=3D"FONT: 10pt arial"><B>Subject:</B> [CANSLIM] many newbie = questions=20 about Industry Groups</DIV> <DIV><BR></DIV> <DIV><FONT face=3DArial size=3D2> <P class=3DMsoNormal style=3D"MARGIN: 0in 0in 0pt"><SPAN=20 style=3D"FONT-FAMILY: Tahoma"><FONT size=3D3>I=92m trying to figure = out the=20 importance of Industry Groups.<SPAN=20 style=3D"mso-spacerun: yes"> </SPAN>WON says pick a leader = in a top=20 20% group and that half of a stock=92s performance is related to its = group.<SPAN=20 style=3D"mso-spacerun: yes"> </SPAN>WON also says pick from the = top 6=20 groups making new highs. (IBD Rule #11).<o:p></o:p></FONT></SPAN></P> <P class=3DMsoNormal style=3D"MARGIN: 0in 0in 0pt"><SPAN=20 style=3D"FONT-FAMILY: Tahoma"><FONT = size=3D3> <o:p></o:p></FONT></SPAN></P> <P class=3DMsoNormal style=3D"MARGIN: 0in 0in 0pt"><SPAN=20 style=3D"FONT-FAMILY: Tahoma"><FONT size=3D3>Is it a valid screen then = to start by=20 looking only at the top 40 groups, find the leaders, and then check = for RS and=20 EPS, etc?<o:p></o:p></FONT></SPAN></P> <P class=3DMsoNormal style=3D"MARGIN: 0in 0in 0pt"><SPAN=20 style=3D"FONT-FAMILY: Tahoma"><FONT size=3D3>There doesn't seem to be = a lot of=20 discussion here about industry groups, although there have been = several posts=20 recently.<SPAN style=3D"mso-spacerun: yes"> </SPAN>Do you = consider group=20 strength then as a secondary factor? It is not part of CANSLIM = is=20 it? Some of you even invest only in certain = sectors.</FONT></SPAN></P> <P class=3DMsoNormal style=3D"MARGIN: 0in 0in 0pt"><SPAN=20 style=3D"FONT-FAMILY: Tahoma"><FONT = size=3D3> <o:p></o:p></FONT></SPAN></P> <P class=3DMsoNormal style=3D"MARGIN: 0in 0in 0pt"><SPAN=20 style=3D"FONT-FAMILY: Tahoma"><FONT size=3D3>I particularly liked = Katherine=92s=20 posts regarding researching groups showing new rising strength. I = watch the=20 Industry Groups table and the list changes dramatically from one month = to the=20 next.<SPAN style=3D"mso-spacerun: yes"> </SPAN>Is this a bear = aberation or=20 normal?<SPAN style=3D"mso-spacerun: yes"> =20 </SPAN><o:p></o:p></FONT></SPAN></P> <P class=3DMsoNormal style=3D"MARGIN: 0in 0in 0pt"><SPAN=20 style=3D"FONT-FAMILY: Tahoma"><FONT = size=3D3> <o:p></o:p></FONT></SPAN></P> <P class=3DMsoNormal style=3D"MARGIN: 0in 0in 0pt"><SPAN=20 style=3D"FONT-FAMILY: Tahoma"><FONT size=3D3>How much of a group=92s = strength is=20 dependent on one stock=92s performance?<SPAN style=3D"mso-spacerun: = yes"> =20 </SPAN>If this is the case, isn=92t group performance a misnomer?<SPAN = style=3D"mso-spacerun: yes"> </SPAN>Also I see that certain = groups have a=20 lot of new highs, but also a lot of new lows.<SPAN=20 style=3D"mso-spacerun: yes"> </SPAN>Is this just a reflection of = today=92s=20 market conditions?</FONT></SPAN></P> <P class=3DMsoNormal style=3D"MARGIN: 0in 0in 0pt"><SPAN=20 style=3D"FONT-FAMILY: Tahoma"><FONT size=3D3></FONT></SPAN> </P> <P class=3DMsoNormal style=3D"MARGIN: 0in 0in 0pt"><SPAN=20 style=3D"FONT-FAMILY: Tahoma"><FONT size=3D3>In short, how much = attention do you=20 pay to the industry group and why?</FONT></SPAN><SPAN=20 style=3D"FONT-FAMILY: Tahoma"><FONT=20 size=3D3>THANKS.</FONT></SPAN></FONT></P></DIV></BLOCKQUOTE></BODY></HTML= > - ------=_NextPart_000_034E_01C2EE01.C4040150-- - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". 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