C-A-N-S-L-I-M: A Simple, Easy to Use Stock Picking System Message Board

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Non-Tech : C-A-N-S-L-I-M: A Simple, Easy to Use Stock Picking System

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To: John T. who wrote (8)	7/13/1999 11:07:00 PM
From: The Philosopher	Read Replies (1) of 42

But the problem I see is that the canslim method seems not to take the current price into account anywhere. It doesn't even look at how the current price fits with past prices. If IBM fits the criteria, say, then according to canslim you should buy it even if it were selling, for some reason, for $1,000 per share. IMO, there are two things to look for. One: is this a good stock to buy for future growth? Two: what is a fair price to pay for this stock? Canslim ignores the second element entirely. If you overpay even for good stocks, you will not make money no matter how good the stock is. My personal approach is to evaluate the company. (Although I don't use the canslim method, I use some of its elements.) Then if I think it is a worthwhile investment, I ask what price I'm willing to pay for it. If the stock is selling above that price, but if the price is one the stock might come to sometime in the next 12 months, I put in a buy at that price and wait for the stock to come to me. IMO, market price buys are almost always a mistake. There are exceptions, but not many.

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