Billyjoes Top 10 Cheap Stocks

[billyjoe]

Cheap Stock Port Week 10 Wednesday

Not looking good for the cheap stocks. 5 stopped today :HOM EGY MOSS RWC PRFT leaving us with 2, TLF +4.1% for the week and our super stock SURG, up 28.98% for the week.

We have approximately $770,500 in cash and will wait an hour or so tomorrow to see if SURG or TLF gets any of it.

billyjoe

[billyjoe]

Week 10 Cheap Stock Port Tuesday

Highlights
NUAN stopped $95,949
TSCM stopped--96,000
AOB stopped----95,993

TLF +3.84%
EGY +3.20%
SURG +19.05%

Stops remain at 4% Wednesday

billyjoe

[billyjoe]

Week 10 Cheap Stock Port TUESDAY

Opening Prices Stops 4%

HOM--5.60--5.38
TLF---6.90--6.62
EGY--5.05--4.85
MOSS-6.21-5.96
NUAN-7.90--7.58 stopped
RWC--9.34--8.97
PRFT--9.95-9.55
TSCM-8.50-8.16
SURG--4.21-4.04
AOB---5.49-5.27 stopped

billyjoe

[billyjoe]

Cheap Stock Port Tally of Companies Appearing

36 companies have appeared in the cheap stock port over the last 10 weeks.
This is the company list and number of appearances. After market close next Friday we will list each company and it's performance since first appearance.

Weeks---- Stock

10--HOM
9---RWC TLF
8--MOSS
6--LPSN
4--MED NUAN GROW
3--COGO SPIL APLX PRFT EGY
2--AOB IFO ERS ENG GW CYBS AEY STAK
1--CBIZ MIG CGFW NBG BTJ ACTU FPP MESA CMPX SLW PRZ CMT GEOI TSCM SURG

billyjoe

[billyjoe]

Cheap Stock Port Week 10

HOM--5.60-- home restoration after floods, wind damage
EGY--5.00--- oil and gas exploration in Texas gulf and West Africa
TLF--6.80--- retail and wholesale leather goods
MOSS-6.10--designs and licenses clothing for target stores
NUAN--7.91--speech and digital imaging software
RWC--9.33--wireless mobile radios
PRFT--9.99--informational technology for central U.S.
TSCM--8.42--investment analysis and news, Cramer's company
SURG--4.20--designs and manufactures medical devices
AOB--5.49---Chinese herbal medicine and health products

billyjoe

[billyjoe]

Cramer has 17 stocks under $10 that he currently recommends. I'm proud to say that none of my current top 10 are on his list. Two of his ENG and GW have appeared on my list previously.

billyjoe

[billyjoe]

Dave,
What if I buy my 50,000 shares of MOSS, drive the price up, then slowly sell over a 10 week period?

billyjoe

Billyjoe, if you want a more realistic paper portfolio return, use $50,000 rather than $500,000.

<< You said I couldn't purchase 1/3 of the daily average volume without driving up the price. That's certainly true but couldn't the subsequent rise in price more than make up for the slippage? >>

Just like a high volume buy will drive the price up as you're buying, a high volume sell will drive the price down as you're selling. It all comes down to supply and demand so when you're "creating" the demand and then the supply, you'll get hurt both buying and selling.

[billyjoe]

Week 9 Cheap Stock Port Hold and Fold Method

3 Huge winners this week RWC +19.06% GEOI +11.75% MOSS +7.47%

Final dollar totals (started with $100,000 each position)

HOM stopped Mon.$95,010
TLF stopped Tues. 95,072

MED stopped Wed. $102,027
RWC stopped Wed. 119,060
GEOI stopped Wed. 111,746

NUAN stopped Thurs. $96,697
PRFT stopped Thurs. 95,897
EGY stopped Thurs. 99,564
LPSN stopped Thurs. 98,761

MOSS sold Friday $107,465

Grand Total $1,021,299 minus transaction fees of $300 = $1,020,999 or again of 2.1%. Next week is the final week of the experiment.

billyjoe

[billyjoe]

Week 9 Cheap Stock Port Friday

We started today with 1 stock left MOSS @6.11 .We sold it @6.19 resulting in a nice profit for the day and the week.

Starting today with lots of cash $702,800 we decided not to reinvest

MOSS started with initial position $105,903 , it's money reinvested from sale of HOM $97,237 , and later reinvested funds that had grown to $100,993.

Todays gain before the sale made the initial position worth $107,465 , the HOM reinvested money worth $98,019 , and the $100,993 worth $102,483.

We sold everything resulting in $1,010,767 minus transaction fees of $300 leaves us with a $10,467 profit or 1.05%

billyjoe

[billyjoe]

Dave,
I should figure $1000 per stock in the port. instead of $100,000. But the higher figure makes things more interesting. You said I couldn't purchase 1/3 of the daily average volume without driving up the price. That's certainly true but couldn't the subsequent rise in price more than make up for the slippage? Especially when buying large amounts of the same stock for several weeks in a row. Of course I'm also selling large amounts of the same stocks each week.

billyjoe

<< I'm just figuring a flat $300 for transaction fees most weeks. How much slippage do you allow for? >>

It's a function of average daily volume and price per share. If you're buying $500,000 of a $10 stock with an ADV of 150,000 shares per day, you'd be accounting for 1/3 of the ADV. No way you'd buy that much w/o running up the stock price or taking several days to get filled on a limit order.

In the above example, assume your commission costs are 1 cent/share; that's $500. Now figure an average of 2% for a slippage factor, which is realistic in a thinner ADV stock; that's an additional $1,000. Round trip you're looking at $3,000 in fees and slippage, not $300.

Even with a more liquid stock, say a $20 stock with 1% slippage, you're looking 25,000 shares: $250 in commissions plus $250 in slippage, for a roundtrip expense of $1,000.

I've seen slippage in even more liquid stocks that for one reason or another trade with a larger spread, to be as high as 3%. On a $20 stock that's only 60 cents. If you assume you're using limit orders, it's unrealistic to think you'll be filled on all the shares of a low-priced stock at your limit price on the day of purchase.

[billyjoe]

Cheap Stock Port Week 9 Thursday

Stopped today:

NUAN $96,697
PRFT 95,897
EGY 99,564
LPSN 98,761

Our only remaining stock is MOSS , with reinvested funds from HOM and $100,000 reinvested today from previous stopped positions is worth $304,133 and we have cash totalling $702,800 for grand total of $1,006,933. Will decide tomorrow what to do. Stop at 2% of open tomorrow.

billyjoe

[billyjoe]

Dave,
I'm just figuring a flat $300 for transaction fees most weeks. I know that's unrealistic considering some of the buys are up to $400,000 worth of a $6.00 stock, but I'm trying to keep it as simple as possible. What is reverse slippage called? I actually got one for about .04 under my order a couple weeks ago, but that may be an exception to the rule. In theory, these are not all market orders, but most of the buys are. Sells are limit orders to prevent getting killed in pre-market as happened with HOM in week #2. How much slippage do you allow for?

billyjoe