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Strategies & Market Trends : Strong Industry Groups - Strong Stocks

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To: Sam Raven who started this subject4/8/2002 1:31:18 AM
From: Sam Raven  Read Replies (3) of 1567
 
Since it is so hard to make a table on SI, I thought I'd do the same risk/reward example as last week, on Monday's picks, but limit this post to the risk point and reward points math. The actual buy range, stop and target are posted in savvy-trader.com

The average loss per this list is -1.32 points while the average gain is +3.57 points. So the math.....

0% success rate (all positions hit stops) is a loss of 6.59 points or 4.26% of investment.

20% success rate (one stock hits target price, the rest stop out) is a loss (average) of 1.95 points or 1.26% of investment.

40% success rate (two positions hit target price) is a gain of 3.19 points or gain of 2.1% on investment.

60% success rate (three positions hit target price) is a gain of 8.07 points or 5.5% on investment.

80% success rate (four positions hit target price) is a gain of 12.96 points or 8.4% on investment.

100% success rate (all positions hit target price) is a gain of 17.87 points or 11.5%.

It is unreasonable to expect 80 to 100% success over the next couple weeks. But a 40% success rate yielding 2.1% is a good return, and has favorable odds, the assumption being we are not going to have a deep market correction during that period.

We'll keep track....

Good Trading!!

Sam
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