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Markets look great, again

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May 18, 2006 4:16 pm

There are many ways to do it.  It is much easier if you manage fee based stock accounts. 

One way is to scan for stocks that had good relative strength over this past several days.  If you understand charts also check that out for stocks that had the good rs.  If the over-all chart is good and RS has been good and, "if you like fundamentals it has good fundamentals," that may be a good buy right now.  You need to get on board with the operators on Wall Street.   Figure out where the big money is flowing.  THis, in very brief, is how you do that.

Secondly, use stop losses.

Thirdly, learn to short stocks. 

Last, consider RYDEX inverse funds and the Prudent Bear fund.

If you operate a commision based business all this is difficult to do.   Watch the BKX.  This puppy is sitting right on top of its 50 day moving average.  If that drops below that, watch out because the market is really going to puke.   

May 18, 2006 5:15 pm

One other thing, if you are considering RYDEX or BEARX you are too late as of right now.  Watch the importent indexes though because this market could leg down again. If it does you will have advance warning and there is where you could take advantage of these mfds.

Man am I glad I am not at EDJ telling my clients to just hang in there.  This is where I pick up referrals and grow my biz.  I love it.  

May 19, 2006 1:06 am

[quote=Malcolm] If that is all you are using to determine when to buy you

are not making the best decisions. Really. If you are going to start to use

technicals you need to learn how to use more than just that.[/quote]

I appreciate your point, a good one. But I’m neither “starting” to use

technicals, nor only relying on OB/OS. Rather, suggesting an overlay

technique in addition to RS, VA Pct, Money Flow and moving avgs. I’m simply

bringing up the subject to explore anyone’s experiences. Thanks.

May 19, 2006 2:20 am

[quote=Mike Damone][quote=remotecontrol]

[quote=Revealer]It's all about value. This ain't a bull mkt., what we experienced was a rally (cyclical bull) in a secular bear mkt. History of bull mkts is that they start from MUCH lower valuations than what we have experienced. Go ahead and talk about PE ratios lower than 3-4 yrs ago. Still not low enough to qualify. Maybe single digits before we start secular bull again. Yeh, I know the argument of the "fed model". If we use this valuation method then we are hostage to interest rates. (Now about those "poor saps" that use a 60/40 allocation.)[/quote]

Perfect. No bull market has EVER commenced with a P/E higher than 11. In addition, the average gain in up years is higher in a BEAR market than a bull market.


Fair enough.  How does one make money in this market then?


You need to find something that consistently outperforms the market in good and bad years. I've been using a UIT strategy since Oct of 2002 that is up 84% compared to 50% on the S&P 500, as of today.

May 19, 2006 12:57 pm

C’mon Remote.  I have an ETF/Mutual fund strategy for small
accounts that, if tracked 50% back on the S & P 500, is up more
than 90%.  How?  Owning a little small cap, emerging markets,
international, along with everything else including 42% bonds and
cash.  I rebalance 2 times a year. 

UIT’s with all of there tax problems in non-IRA’s when markets pop
up?  Mutual funds are bad enough, but UIT’s are just plain

A little harsh, I don’t mean to throw a spear at you, but beating the S&P over the last couple of years has not been hard.

May 19, 2006 1:14 pm

You could’a beat the S&P for past 5 yrs. with BONDS. Don’t pick out mkt. lows (Oct '02) for comparisons, use entire cycles. (Don’t use the mantra about stocks returning blank % for past 77 yrs. or whatever Ibbotson uses,) how many of us have a 77 yr horizon??

May 19, 2006 1:24 pm

I use them in a VA, mostly. I go back to Oct. 2002 because that’s when I started using the VA. I’ve got real numbers going back to 2000 in the perspectus, but I’m not gonna claim something that I didn’t achieve, personally.

I've got something that I believe in and it has delivered. If you guys wanna piss on what I do, go ahead. I'm happy and you won't change my mind about anything.