In my only other post thus far, I talked about the importance of having a strategy. Notice I used the singular, and not “strategies.” I think that for many of us, it’s important to keep our overall approach as simple as possible. I find that when I try to add an additional strategy to my arsenal, I focus on the stocks purchased via the new methods far too much, and wind up ignoring buy and sell signals in the kinds of stocks that I’ve historically done well in. That’s not a good recipe in a market as difficult as this.
Here’s my criteria – I tend to do well when I restrict my stock purchases to fast growing businesses sporting high ROEs, with stock prices breaking out to new all-time highs. Ideally, these companies are engaged in a business that have the potential to capture the imagination of the public. I recently got myself in trouble with a “buy and hold come hell or high water” approach to the social media space. While social media meets that last criteria, it didn’t meet all the others.
But let’s not dwell on the past. The market was up today and I’m back at the turret. I screened the market for my typical stocks, but also added in some additional criteria. I further restricted my hunt to stocks that were up over 2% today, on good volume, and that were being accumulated by institutions. I don’t want to focus on a stock that had been doing well solely because of its defensive nature, and the second the market bounced, it became a source of funds. PPT members can find that watch list here. I’ll tell you non-members that $UA is one of my favorites from the list.
Never question the power of specialization. BEHOLD! The man in the video is able to author books and apparently make a living as a professional pencil sharpener. Before you motherfuckers laugh, note that his pencil of choice is a Blackwing.
