Steckler's Star Studded Stock Picks

[DSteckler]

Dave...is their any record of how these bow tie stocks pan out overall?...thx...Doug

Doug, those are just the entry criteria. How well they work out (assuming the trade is entered into) depends upon your exit and money management criteria.

[DSteckler]

Go west, (not so) young man

Off to San Diego early in the a.m. Sunday. Cya on line!

[IIC]

Doug, those are just the entry criteria. How well they work out (assuming the trade is entered into) depends upon your exit and money management criteria.

I realize that Dave...But???

Have a good time in San Diego...Come up 125 miles and I'll take you out to dinner...Doug

[DSteckler]

I realize that Dave...But???

But what?

I sell half the position when my profit = risk. I then place a break-even stop on the remaining shares. Once profit = 1.5X risk I switch that to a trailing stop.

Using this exit/money methodology, Average W/L ratio is about 2.5:1, but the percentage of winning trades is only about 42%.

[Runner]

Dave, your exit plan is very similar to the one I use. Do you use a fixed percent of risk for you positions?

[IIC]

But what?

I sell half the position when my profit = risk. I then place a break-even stop on the remaining shares. Once profit = 1.5X risk I switch that to a trailing stop.

Using this exit/money methodology, Average W/L ratio is about 2.5:1, but the percentage of winning trades is only about 42%.

OK...that's basically what I was asking...thx...although when does "profit=risk"?

[Runner]

IIC, I think Dave is referring to this example. Say you set up a trade and your initial risk is 4.00. This means if the stock hits his initial risk of 4.00 on the upside he will sell ½ his position. His R/1 risk is 4.00. If it goes against him he will bail out at the R1 level or 4.00 under his entry. Once it goes past his R1 to the upside and hits 1.5 or 5.50 he puts in a trail order.

[Runner]

deleted this thread........IIC, you can even do this with your DT’s. Except your expectancy may be smaller. If your only risking .50 you could look to trail after your up .50 and attempt to get a higher R multiple. I view a very good target is R3 this simply means your now 1.50 up on your position. Once this happens you can set your trail stop to your preference. Simple method but effective… Now here is where you might have an advantage. You most likely will have more opportunities as your trading off intraday charts. If your hit rate is good and if you hit R3 consistently I bet you would be one very happy trader. Easier said than done though.

Also a system that only has a 42% hit rate can make more money then one with a 70% hit rate if you can believe this….Sure someone can be right very often but pull out with a very little profit. Sure he has a 70% hit rate but is he profitable?

[IIC]

IIC, you can even do this with your DT’s. Except your expectancy may be smaller. If your only risking .50 you could look to trail after your up .50 and attempt to get a higher R multiple. I view a very good target is R3 this simply means your now 1.50 up on your position. Once this happens you can set your trail stop to your preference. Simple method but effective… Now here is where you might have an advantage. You most likely will have more opportunities as your trading off intraday charts. If your hit rate is good and if you hit R3 consistently I bet you would be one very happy trader. Easier said than done though.

Also a system that only has a 42% hit rate can make more money then one with a 70% hit rate if you can believe this….Sure someone can be right very often but pull out with a very little profit. Sure he has a 70% hit rate but is he profitable?

I agree that you can be more profitable with a lower hit rate...The way I dt I could've been profitable in the 40% range...the last 2 years on dt's I was right a little over 62% of the time...this year it is a little higher...But this year I'm perfectly satisfied to take 1-3%...I have not really had any dt runners this year...but I have not had any big losers either.

I am seriously considering bailing on all longer term trades and only day/swing trading...Been 3 yrs on swings and 2 years on dt's...it is about time I put more money into those trades I think.

[Runner]

IIC, I think one of the biggest mistakes we traders make is misunderstanding Risk and or money management. Trading is not a get rich quick thing and many who hit it big often go bust. I think we all are looking for consistency over time. If you don’t mind me asking what is your risk tolerance per trade based off you total account value? You don’t need to tell me the dollar amount, as this is not my business. I’ve tried to raise this point in the past with little success. I only put 1-2% total account up on any one trade for swings. Now how one sets this up often yields very different results. The point being the number of shares one buys is very important. I can have a stop at a 15% loss and still be only risking 2% of my total account with fewer shares. Not sure many understand this and I think this will be the last time I mention it here.

[IIC]

IIC, I think one of the biggest mistakes we traders make is misunderstanding Risk and or money management. Trading is not a get rich quick thing and many who hit it big often go bust. I think we all are looking for consistency over time. If you don’t mind me asking what is your risk tolerance per trade based off you total account value? You don’t need to tell me the dollar amount, as this is not my business. I’ve tried to raise this point in the past with little success. I only put 1-2% total account up on any one trade for swings. Now how one sets this up often yields very different results. The point being the number of shares one buys is very important. I can have a stop at a 15% loss and still be only risking 2% of my total account with fewer shares. Not sure many understand this and I think this will be the last time I mention it here.

I understand it...But I don't really have a set amount...that might be a mistake...But I like different setups to different degrees...Like yesterday...I was a bit cocky after going 9 in a row...So I got cute trying to call a bottom on RACK...but I went in light and lost a few cents...A few Friday's ago(7/14) I really liked FTO and I backed up the truck...Perhaps that's why I trimmed so fast on it...But it worked out well...If I had invested less I'm fairly certain I would've made more per share...I'm not really a good person to discuss money management with because my $$$ amounts vary widely based on my gut feelings...Doug(IIC)

[Runner]

IIC, here is something you can experiment with. You have an awesome list in the IIC 100. take a port of 100K and say you’ll risk 2% of this 100K or 2,000. This will be the total amount you will risk. Now take your 2000. Risk and divide it by your top 10 that you think will yield you the best results. Now for each of these positions your risk is 200. This means you will get out if and when a position drops 200.00 from your entry. If all your positions get stopped your still with in your 2000. tolerance. Set these boys up in a test port and track them. When you get a profit of 300.00 set a trail and let them run. You will get stopped out and when this happens you can reinvest as necessary. Play with it and see what happens. Nothing lost, as this is simply a test. I think this can be very educational…

[DSteckler]

Earnings are meaningless

Ex-SEC Chair: Earnings Are Meaningless

All Associated Press News

NEW YORK (AP) - Imperfections in the accounting system make quarterly earnings numbers meaningless, former Securities and Exchange Commission Chairman William Donaldson said Tuesday.

Speaking at an event sponsored by the CFA Centre for Financial Market Integrity and the Business Roundtable Institute for Corporate Ethics, Donaldson said, "The real issue is to stop managing a company for the quarterly results."

Thanks to assumptions allowed under accounting standards, quarterly earnings numbers "are so vague," Donaldson said.

[DSteckler]

GIGM worth watching

Very low ADX (13.86) and breaking out to the upside. Light volume, however, so be careful out there.

[DSteckler]

Worth watching

EZPW - symmetrical triangle.

GM - rolling over after rising on decreasing volume the past few days.