Re: [CANSLIM] Reasonable Goal?

From: "Rolf Hertenstein" <rolfh@mindspring.com>
Subject: Re: [CANSLIM] Reasonable Goal?
Date: Sat, 24 May 2003 16:11:30 -0600
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Hi Ian - I like your response better than mine - much more optimistic.

Following up on Gene's question, approximately how much time do you spend
(daily, weekly, ??) to achieve those gains?  If this is too personal a
question, please say so.

For me, discipline seems to be a function of time.  That is, the more time I
have available, the more disciplined my trading becomes.  When other demands
on my time make me less focused, I tend to make stupid mistakes.

 Rolf

- ----- Original Message -----
From: "Ian" <ianstm@shaw.ca>

> Hi Tomas:
>
> I'll be the exception here and say that I believe that 40% a year is a
> reasonable goal (particularly up until you have about $600,000 - IMHO,
> outsized returns are a lot easier with smaller amounts of money) if you
are
> extremely disciplined about:
> * cutting losses very early
> * REALLY letting your winners run
> * committed to buying strong breakouts during confirmed rallies (You don't
> have to believe in a 'secular bull' to do this - but you do need to
> understand that most of these rallies are good for about 2 months and 30%
> runs in the indices).
>
> NONE of these 3 things are remotely easy. They all seem to fly in the face
> of basic human nature. But they are all absolutely essential to achieve
> outsized gains.
>
>
> My personal goals are to double every two years (about 42% per year), and
I
> have been achieving it. As an example, my virtual fund was started 2 years
> ago this weekend, and is up about 118% to date:
>
http://www.marketocracy.com/cgi-bin/WebObjects/Portfolio.woa/wa/FundPublicPa
> ge?source=DoPiAlBbDlAmIgAmMaKiAbBi (and this was during an ugly market,
and
> with an average of 30% cash, and no shorting allowed, and using strict SEC
> mutual fund asset allocation rules)
>
> As a Canadian, the hardest part about trying to compound the gains is
> taxes - I'm not sure how difficult that is in the US.
>
> Consider all the strong post-March 12 breakouts that are up 80-200%. If
you
> slowly went to fully invested as these breakouts happened, you would
easily
> be up 40% in the last 2 1/2 months.
>
> IMHO, with an unintentional focus on microcaps and nanocaps, I think that
> somewhere in the neighbourhood of $2,000,000 - $4,000,000 is where these
> kind of gains become more difficult. Therefore, for the professional money
> manager, who must look after 10's of millions just to earn a living from
> fees, it really is unreasonable to expect 40%+ annual gains. But for the
> individual investor with a much smaller amount of $$$, I believe their
> 'money making universe' is an order of magnitude larger in terms of
> available equities, so they have a reasonable chance at these kind of
gains.
>
> Consider SSYS and HITK, which have been 2 of the best stocks during the
last
> 2 months. Both of them were trading under 100,000 shares a day when the
> rally started (SSYS had a 13,000 share day in early march, with the
average
> probably under 50,000). As a professional manager with $100,000,000, you
> probably couldn't or wouldn't buy enough of either of these to make a huge
> impact on you fund. But as an individual, if you buy 6-10 positions for
> yourself, these two stocks alone could have netted you 20-30%.
>
>
> Cheers,
>
> Ian
>
>
> Marketocracy has 100+ funds that were up 30% in the last 30 days alone:
>
http://www.marketocracy.com/cgi-bin/WebObjects/Portfolio.woa/wa/RankingViewP
> age?date=20030516&subject=30Days%20Rankings%2081%20%2D%20100
> IMHO, that is only possible because of the small position sizes.
>
>
>
>
>
>
>
>
> ----- Original Message -----
> From: Tomas <tomas986@yahoo.com>
> To: canslim canslim <canslim@lists.xmission.com>
> Sent: Friday, May 23, 2003 12:57 PM
> Subject: [CANSLIM] Reasonable Goal?
>
>
> > This question is for the senior CS'ers.  If an
> > investor is 29 years old right now, and his goal is to
> > make $2M by 40 to retire, is this a reasonable goal?
> > The assumption is that he will start with $10K and add
> > between $5-$10K capital every year.
> >
> > I understand that there are many factors like
> > - how discipline you are
> > - how diligence you are
> > - how persistent you are
> > - how you learn from your mistake and
> >   do post analysis of your trades
> > - and even how lucky you are.
> >
> > But assumption that the investor is decently good on
> > those factors.  What is your opinion?
> >
> > Thanks,
> > tomas
> >
> >
> > __________________________________
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> >
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