Hi RFH, Yep, Flawless Timing is a gift that some of us didn't get, I guess!!
I once reviewed all my trades with VLSI over several market cycles with a very talented technical trader. We summed and averaged all the buys and sells (the ones that came in strings, not the alternating ones). One such buying spree had me accumulating from about $25 down to $12 and selling again from about $17 to about $30.
I then asked him to show me on his charts the place he'd have bought in and sold out. Funny, his points were almost EXACTLY the average costs of my buys and sells! I was 100% invested with about the same average cost as his trading methods and I was about 50% Cash when he was out of the market completely. As I mentioned in the AMAZON.com message, there was a difference in the actual dates, but not much in the results. Also, his method left him "naked" of shares if the rally had kept going. It did conserve his cash for a longer time and gave him some extra interest, however.
I'm impressed with the fact that there's not much middle ground in the comments! It's either love or hate!! I was happy to see no posts from any Atlanta ST Traders!! :-) (Sorry for the gallows humor!) We don't need any bludgeoning going on around here!!!
I believe that the constant indoctrination by interested parties towards the belief that ST trading is the ONLY way to make money is the root of the dicotomy of opinion. I didn't see a single Buy & Hold investor commenting on Mr. Lichello's methods! I guess they're just too rare any more! I know some in the area and am usually impressed with how well they do. Since we know that our trading is to eventually build up a portfolio equal to or greater than the buy and hold investor, we need to focus on that potential. This is where the AIM investor changes focus from either the ST trader or the Buy & Hold investor.
Our focus is on stocks that have patterns that a ST trader would probably like, yet have the long term potential that would attract a gutsy B&H investor. It's in our best interest not to ignore the talents of these other extremes. Mr. Buynhold has a talent for selecting for the very long term. Mr. S Trader has a talent for selecting patterns and attempting to get into sync with them. AIM is our natural synchronizer, but we are left with the task of understanding long term potential. The other extremes ignore their opposite's potential. ST doesn't want to know about potential and B&H doesn't care about market price fluctuations.
I'm not sure if we're Buy & Hold investors in Trader's disguise or the other way around. I guess most of us got here from one extreme or the other. Mr. Lichello's AIM is the middle ground, so I guess we'll remain "unloved" by either extreme!!!
Thanks for the note,
Tom |
