Stenzrob's specials

[The Kid]

Stenz,

You rock the house!! That goes without saying. Your stock picks have been very successful, so much so that even the Huge One has commended you. My question to you is this -- Is that a picture of you in your avatar?

Thanks,

The Kid

[stenzrob]

SCKT

I bought SCKT for $3.79 after it broke out to a new 52 week high on higher than average volume about a week ago. After resting a bit, it did it again yesterday and is following through (so far) today, putting my position up over 16% in one week, but this is just the start for it, IMO. I have no idea what it might do day by day, but the price and volume trend along with the solid fundamentals to back it up tells me this stock could be a big winner. We shall see.

[stenzrob]

Stenz,

You rock the house!! That goes without saying. Your stock picks have been very successful, so much so that even the Huge One has commended you. My question to you is this -- Is that a picture of you in your avatar?

Thanks,

The Kid

Thanks, Kid. That is not a picture of me in my avatar. That's what I'm planning to take to the plastic surgeon to use as a guide when I have made enough money to pay for the improvements.

[billyjoe]

long term vs. short term

I've always been amazed by those who buy and hold, never giving a thought to a small fast gain. Does anyone have a simple table showing the results over a period of time contrasting short gains of 5% - 10% per month compounded vs. yearly gains of 50%- 100%? I seem to have little problem picking breakouts, the problem is the reversal that usually happens within a week. Maybe a 3-5 day holding period would work. Most of the paperwork concerning IRS is eliminated by doing this in a self directed IRA. No capital gain worries. Billy Joe

[tokyojoeskid]

gigm

nothing seemed to exciting about earnings. looks like a selloff after hours. I think i may sell in the morning, one thing i like is they are going to concentrate on revenue growth, havnet looked into report this is just from first glance.
stenz what you thinkg?
tjk

[stenzrob]

GIGM results

tjk - The GIGM report is nothing to get excited about, IMO. Most of the sequential revenue growth was in offline, which has pretty low margins, and the previous quarter was cited as being particularly bad due to SARS. The broadband revenues were flat. Their burn rate is very low, and I think they're making the right moves. Downside is limited by the price being a small premium to book value.

I think there's still money to be made in this one, but it will take a while. As I mentioned to The Kid in his poll thread, I like to be in 5 or 6 positions that have the greatest chance (IMO) of explosive gains. I will probably be looking for an honorable exit. Since I bought at $1.60, I guess anywhere around here could be considered an honorable exit.

Looking back, I should have been quicker to sell as soon as the stairstep pattern was violated with some volume on Monday, as you yourself pointed out on Tuesday.

[stenzrob]

Re: GIGM results

I will probably be looking for an honorable exit. Since I bought at $1.60, I guess anywhere around here could be considered an honorable exit.

Out at $2.29, for a 43% gain after having been up over 100% at one point. Easy come, easy go.

[tokyojoeskid]

wow

Well stenz unfortunately i didnt getout of gigmwhen ishould have andthe space bar atthe computer lab is a piece of 8***. dont know if i should wait for a short sypothy run before i sell, if that doesnt happen that just means ilose more money. Now if i do sell (bought at 2.70) just means im going to have to make 40% on my next pick, dont you love the market.. . ha oh well im young, next time i have to stick to my rule book. well what you think sell now? if you were in myshoes. i think i may sell half, watch the charts more careful and unload the rest if it hits 2.
thanks
tjk

[stenzrob]

Re: wow

Sorry to hear about that, tjk. What should you do with GIGM? Sometimes stocks that sell off like this will bounce in the short term, providing a way to exit with less loss. But, sometimes not. What you should do depends on your pain threshold and your goals.

Let me share bit of the stenz philosophy - maybe this will help, maybe not. (And note that very little of this is consistent with the $$$MR_MARKET$$$ method.)

1. You don't "have to" make 40% (or 15%) on your next pick, every trade should be as profitable as it will allow and you can make it, preferably in as short a time period as possible.

2. Every day is a new day, and it doesn't matter what's happened before except as it might serve as an indicator of the future (TA).

If you are holding $10,000 worth of stock and something terrible happens and it drops 20%, you now have $8,000 worth of stock. The $2,000 is gone - deal with it. You don't have $10,000 anymore, and the sooner you forget about the $2,000 and move on the better. The only purpose served by thinking about your loss at all is if you can learn something from it to prevent it from happening again. As I said, GIGM broke out of it's stairstep pattern before the report and that's when we should have sold. I was too slow. Believe it or not, I don't really care that I lost 10% on my GIGM position from yesterday afternoon to this morning. What bothers me more (meaning that I have something to learn from it) is the 9% that I lost from $2.75 when the pattern was clearly broken down to $2.52.

Now, what would would you do today if you had $8,000 to invest?

- Would you buy that very stock for the long term because you think the 20% hit was too much given the event that caused it? If so, hold it.

- Do you think that bargain hunters will cause a short-lived bounce that won't follow through in the longer term? If so, then hold until it looks like the bounce is fading or until you have another more compelling idea and then get out. Do NOT continue to hold because you hope it will get back to your purchase price - the stock does not care about your hopes, what your purchase price was, and does not listen to your prayers!

- Were you just as disappointed as the market seems to have been? If so, then just sell it and move on to your new best possible thing to do with $8,000.

None of this should involve any emotion (excitement, fear, greed, distress, panic) on your part, only a cold-blooded analysis of what the emotions of others might be.

3. Holding a stock is essentially the same as buying it. Holding a stock means you have decided not to buy something else. Every day that you hold a stock, you are not buying something else with the money you have tied up in it.

4. All of this applies just as much to a stock on which you're up, however much or little. Your position is up 15%? So what! Does the chart or valuation lead you to believe that it will continue going up, whether by price & volume, breakout, or R^2? Then keep it. Up 30%, 50%, 75%, 100%, 176% (like I currently am with TRCI)? So what! What is your best guess about the future direction - based on fundamentals, valuation, TA, whatever. And you must make this decision about every position every day, unless you're on vacation.

I'll tell you what I think Ernie's stock-picking method and mine have in common, even though we get completely different results.
A) There is something about the company's business (revenue growth and/or earnings growth) that says the company is doing well and improving.
B) There is something about the valuation (p/e and/or p/s) that says it ought to be priced higher.
C) Finally, there is something about the chart (relative strength, increasing volume, r^2) that says others are recognizing the first two things.
If you read the prospectus for a growth fund, you'll see that they look primarily at A, a value fund looks at B. Pure momentum traders look only at C.

Sorry I got a little long-winded.
Hope this helps ... stenz

[mrmarket]

Stenz...that was a friggin awesome post.

[tokyojoeskid]

thanks

It was a great post.
A lot of what you said I can see in the words of Oneil, very much appreciated the time you put into that.(did i just sound like yoda . . .weird)
I ended up selling the whole postion, I dont think there is much upside potentienal in the stock(short term) it def is not a A+ in my eyes so why should i keep holding it. there really is no point holding a stock going down "praying" it will go back up, so many people lost money this way 2000-2002. When looking at stocks you should only hold and keep holding the best stocks that fit your criteria.
I feel that yes my money can definately be put to work elsewhere and look forward to finding a great stock in the process of breaking out, wasnt my biggest holding so not a big deal but still had to swallow my pride for the loss, hindsight is always 20/20 but i will probably kick myself three times for not pulling the trigger earlier when it did break down.

watch nutr, if breaks 13 could be a quick couple points, some people try to compare it to a young usna. Only thing held over this stock is the distribution of shares by Bain(holdings) mostly finished for now though, good thing in the end more institutions can hold.

qvdx still looking solid, hbio finally gaining some ground.
man did anyone gobble up amd when it was around 10 was a no brainer but didnt have funds, itig ran up nicely in a week from 4-6.
On the look out for a winner, running the screen toinght hoepfully ill have time this weekend to find one, amist worthless homework/studying

Quick question to everyone out of college, do you use anything from your first four years of college???

[Karel]

What about FOG?

Hi stenzrob, you like buying stocks that have run up and now might be pausing a bit for the next the run. This reminds me of Jon Markman's Flare-Out Growth, or FOG screen. In that article he mentions a timing component, no doubt because 'pausing' may get a very different meaning in a bear market, compared to the bull we are seeing right now.

Of course, your screen is much more articulated and you use Price and Volume to make your entries and exits, but perhaps this is still a thing to consider.

Regards,

Karel

[tx_damnyankee0]

Re: thanks

It was a great post.
A lot of what you said I can see in the words of Oneil, very much appreciated the time you put into that.(did i just sound like yoda . . .weird)
I ended up selling the whole postion, I dont think there is much upside potentienal in the stock(short term) it def is not a A+ in my eyes so why should i keep holding it. there really is no point holding a stock going down "praying" it will go back up, so many people lost money this way 2000-2002. When looking at stocks you should only hold and keep holding the best stocks that fit your criteria.
I feel that yes my money can definately be put to work elsewhere and look forward to finding a great stock in the process of breaking out, wasnt my biggest holding so not a big deal but still had to swallow my pride for the loss, hindsight is always 20/20 but i will probably kick myself three times for not pulling the trigger earlier when it did break down.

watch nutr, if breaks 13 could be a quick couple points, some people try to compare it to a young usna. Only thing held over this stock is the distribution of shares by Bain(holdings) mostly finished for now though, good thing in the end more institutions can hold.

qvdx still looking solid, hbio finally gaining some ground.
man did anyone gobble up amd when it was around 10 was a no brainer but didnt have funds, itig ran up nicely in a week from 4-6.
On the look out for a winner, running the screen toinght hoepfully ill have time this weekend to find one, amist worthless homework/studying

Quick question to everyone out of college, do you use anything from your first four years of college???

A small smithering.....but nothing about trading.

[the_daqman]

Re: What about FOG?

Hi stenzrob, you like buying stocks that have run up and now might be pausing a bit for the next the run. This reminds me of Jon Markman's Flare-Out Growth, or FOG screen. In that article he mentions a timing component, no doubt because 'pausing' may get a very different meaning in a bear market, compared to the bull we are seeing right now.

Of course, your screen is much more articulated and you use Price and Volume to make your entries and exits, but perhaps this is still a thing to consider.

Regards,

Karel

since you mentioned the 'fog' screen i thought i would post a link to it in case anyone wants to play with it. i run it every month and put them on a list. every few months i look back to see how they are performing.

The FOG screen on Moneycentral
* edited to keep the URL from wrecking the layout. --Karel

ns2

[MEA_1956]

Re: TRCI

I love TRCI, TRCI loves me back. But anyway, I just sold the half of my position that I had bought back at $12.32 on 11/5 for $17.49, for a 42% gain in 5 days. Letting the original $6 position run, and looking for a pullback to get the second half back again.

Right after I sold those, I put in a buy order to get them back at $15.80, where I had guessed it might drop momentarily to "fill the gap". I have no idea why gaps often fill, but they do, so I try to play it sometimes. It dipped alright, but only down to $15.90. Missed it by the proverbial thin dime. I have since removed that order and will just wait to see what happens with it.

TRCI has started a selloff. Am i missing something here, I see no bad news developing, at present time it is under your $15.80 mark are you thinking of picking up some more of this one or should we be considering an exit point. ===>MEA