Peanut's Potent Plethora of Profit

[Runner]

To clarify myself incase I sound confusing. Using a 10K account one would have used +- 7,819.60 for the trade. Having said this one would be betting 11% account risk with a stop of .49 from entry. Many get confused on this issue. Yes the trade had +7K on the table but the risk is what is important. From entry to stop would face a 14.04% hit but total risk is 1,100.00 or total account balance of 8,900 – commission fees. Nothing is wrong with having a small portion of your total account for gun slinging.

Now here are the results of using just 2% of the 10K
R/R same or 1.4
TOT shares 408
Cost 1,423.92 –commission
Potential Profit 285.60
Potential Loss 199.92
Entry to stop –14.04%
Entry to Target +20.06

My conclusion is one may have know he was heavy in the position and locked it in to go with the certain 20%. If one had used a small bet size I would think they might have tried to ride the trade longer. I’ve been saying this for along time that position sizing and risk are the most important aspect of your trading system IMO.

Not downing Peanuts play here in any forum folks as he did very well, but if you have not looked into your betting size I would highly recommend you do so.
This part of the game is what fascinates me the most!!

[skiracer]

To clarify myself incase I sound confusing. Using a 10K account one would have used +- 7,819.60 for the trade. Having said this one would be betting 11% account risk with a stop of .49 from entry. Many get confused on this issue. Yes the trade had +7K on the table but the risk is what is important. From entry to stop would face a 14.04% hit but total risk is 1,100.00 or total account balance of 8,900 – commission fees. Nothing is wrong with having a small portion of your total account for gun slinging.

Now here are the results of using just 2% of the 10K
R/R same or 1.4
TOT shares 408
Cost 1,423.92 –commission
Potential Profit 285.60
Potential Loss 199.92
Entry to stop –14.04%
Entry to Target +20.06

My conclusion is one may have know he was heavy in the position and locked it in to go with the certain 20%. If one had used a small bet size I would think they might have tried to ride the trade longer. I’ve been saying this for along time that position sizing and risk are the most important aspect of your trading system IMO.

Not downing Peanuts play here in any forum folks as he did very well, but if you have not looked into your betting size I would highly recommend you do so.
This part of the game is what fascinates me the most!!

Money management, position sizing, and risk vs reward coupled with a plan including entry, stop loss, and target. Traders having the most control and handle on these will end up with the money everytime over the long haul.

[thebign1]

Very Nice

Originally Posted by Runner
To clarify myself incase I sound confusing. Using a 10K account one would have used +- 7,819.60 for the trade. Having said this one would be betting 11% account risk with a stop of .49 from entry. Many get confused on this issue. Yes the trade had +7K on the table but the risk is what is important. From entry to stop would face a 14.04% hit but total risk is 1,100.00 or total account balance of 8,900 – commission fees. Nothing is wrong with having a small portion of your total account for gun slinging.

Now here are the results of using just 2% of the 10K
R/R same or 1.4
TOT shares 408
Cost 1,423.92 –commission
Potential Profit 285.60
Potential Loss 199.92
Entry to stop –14.04%
Entry to Target +20.06

My conclusion is one may have know he was heavy in the position and locked it in to go with the certain 20%. If one had used a small bet size I would think they might have tried to ride the trade longer. I’ve been saying this for along time that position sizing and risk are the most important aspect of your trading system IMO.

Not downing Peanuts play here in any forum folks as he did very well, but if you have not looked into your betting size I would highly recommend you do so.
This part of the game is what fascinates me the most!!

Money management, position sizing, and risk vs reward coupled with a plan including entry, stop loss, and target. Traders having the most control and handle on these will end up with the money everytime over the long haul.

Wax on.... Wax off.... Very good advice Runner & Skiracer.....

[peanuts]

MOMO watchlist - USLM

CURRENT MOMO PORTFOLIO:

USLM, avg $29.5842 ( reduced by 33% 8/8 )
CADA, avg $19.90
TIII, avg $3.0873
LOGC, avg $1.974 ( added 8/8 and 8/9 )
JST, avg $11.19 ( Aug 18 )

USLM is currently experiencing increasing buying volume, and is only 2.8% currently from all time highs. Breakout point is at the high of $36.39. The 1.5 year long Cup and Handle target is $43.

This is a low float, low volume, micro cap. There have been wide daily price fluctuations in the past. It will not take much volume to move this stock. If you decide to watch this, volume of 20K or higher could be considered as the type of high volume needed to make this breakout to higher levels.

This is CANSLIM material with the TA to boot

I have recently added to my total position. The additional shares were not for the MOMO portfolio.

[DSteckler]

<< This is CANSLIM material with the TA to boot >>

USLM would'nt be considered a CANSLIM candidate. EPS Rank is a measly 28 and RS Rank is 71.

[peanuts]

<< This is CANSLIM material with the TA to boot >>

USLM would'nt be considered a CANSLIM candidate. EPS Rank is a measly 28 and RS Rank is 71.

I think that you are looking at the wrong data. I checked the rankings at IBD. Totally different from that which you posted... both in the 90's

[skiracer]

I think that you are looking at the wrong data. I checked the rankings at IBD. Totally different from that which you posted... both in the 90's

Now that is interesting. A diversion of sorts on the RSI and EPS rankings. Dave, where did you take your numbers from. I've often thought that IBD could be putting up their own rankings according to their own way of computing them. Their way may not be the same as other more accepted ways. I really don't know how IBD computes theirs. Dave, how did you come about your numbers.

[DSteckler]

My numbers come from High Growth Stock screening software. I found their rankings to be more accurate then IBD. www.highgrowthstock.com

[peanuts]

I was busy today.

bot MVCO @ 9.82
bot IDWK @ 5.47

[DSteckler]

Now that is interesting. A diversion of sorts on the RSI and EPS rankings. Dave, where did you take your numbers from. I've often thought that IBD could be putting up their own rankings according to their own way of computing them. Their way may not be the same as other more accepted ways. I really don't know how IBD computes theirs. Dave, how did you come about your numbers.

Let's take simple view. I used a three-week lookback period to see how the RS of USLM compared to 8,196 other common stocks (these are stocks > $5). Number 1 is the highest (best performing) and Number 8,197 is the lowest (worst performing). USLM came in at 2,017. No way RS Rank is in the 90's with performance that mediocre.

Now let's look at a 52-week lookback. That's much better, coming in at 568 with a rank = 92.

IBD uses (or used to use) a 26-week lookback period. That may have worked pre-2000 but hasn't worked as well since. That's why I use a much shorter lookback period, to see where the momentum is building and slowing.

So to make a long story short I stand corrected - under IDB/DG criteria USLM has a high rank and is a CANSLIM candidate. Under my criteria, it is not.

[New-born baby]

#1

Dave,
What is the #1 stock in the past three weeks?

[billyjoe]

Peanuts,
Some examples of IBD's mysterious RS ratings. IFON has an 87 RS yet is down over 66% since June of this year. HSR has a RS of 99 yet is down 53% from July of this year. How they figure it is beyond me.

------------billyjoe

[peanuts]

Peanuts,
Some examples of IBD's mysterious RS ratings. IFON has an 87 RS yet is down over 66% since June of this year. HSR has a RS of 99 yet is down 53% from July of this year. How they figure it is beyond me.

------------billyjoe

It seems then, with so many variations of calculating RS and EPS rankings, that the results are useless unless you are familiar with the system which does these calculations. If DSteckler is familiar with his system, that is fine, if anyone else is familiar with IBD's system, then that too is also fine. As long as each person operates within the realm of their relative system, then they should be able to effectively evaluate the meanings of values put on different securities.

I am not familiar with DSteckler's system, so the ranking that he puts on EPS and RS means very little to me right now. I would need to do more research into why his system rates the EPS and RS differently from other systems.

Incidently, USLM is now only 45 cents away from an all time high. That is just 1.24% away. And since it's recent low in mid June, it is now 24% higher. If you look at the benchmark S&P 500, similar data is this: 1.9% from all time highs, and 6.3% above its recent lows which coincide with the timing of USLM's recent lows.

So tell me, is USLM deserving of a low RS ranking when compared with the market benchmark? To me, the stock has been outperforming the market, and deserves a higher ranking of RS. As for EPS ranking, I'm not sure that too many companies are growing earnings at the pace of USLM. Here's one of Rob's EPS charts:

I have not yet found an issue with USLM that makes me say, "They need to be careful about such and such in the future" This company looks to be a great investment vehicle. The management has always been strong, and the major shareholder is very knowledgable in the field. The biggest thing is the "N" They have new natural gas wells in the Barnett Shale Oil and Gas Play. They have only 4 operating now, are drilling more, and can expect large volumes once all are operating. Natural Gas is also one of the largest costs to a lime dehydrating kiln. USLM also just built a new addition to their quick lime operation- to supply lime to the steel industry. Steel uses large amounts of quicklime... LARGE amounts. So, they sell more product, produce that product cheaper than anyone else, and also have excess gas to sell on the open market... hmmmm, future growth, anyone?

[skiracer]

I was busy today.

bot MVCO @ 9.82
bot IDWK @ 5.47

Peanuts,
I have to ask what you saw in these two to take positions in both today. To each his own but could you give me the particulars of the trade for each.
The more I think about it the less I need to know or to put you on the spot about why you made the buys. No big deal. Good luck with both.

[DSteckler]

I am not familiar with DSteckler's system, so the ranking that he puts on EPS and RS means very little to me right now. I would need to do more research into why his system rates the EPS and RS differently from other systems.

I'm guessing you're not that familiar with how DG/IBD calculates their RS rank. They use a 26-week lookback. I posted earlier that I use a 3-week lookback. That's why there is a difference in ranks. The shorter the lookback period, the more sensitive the rank is to changes in performance. For finding swing candidates, shorter is better <G>.