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Strategies & Market Trends : DAYTRADING Fundamentals -- Ignore unavailable to you. Want to Upgrade?

To: Eric P who wrote (2118)	7/27/1999 7:16:00 PM
From: TFF	Read Replies (3) \| Respond to of 18137

Pop quiz...which would u rather b?...a great speculator or a great trader?

To: Eric P who wrote (2118)	7/28/1999 1:10:00 AM
From: -	Read Replies (1) \| Respond to of 18137

Eric, I wasn't talking about THOSE sort of fundamentals. I was talking about studying DAYTRADING fundamentals - how to pick stocks, enter/exit trades, control risk, etc. But thanks for the great stump speech anyway! ;) -Steve

To: Eric P who wrote (2118)	7/28/1999 6:20:00 AM
From: ig	Respond to of 18137

Why I Check Fundamentals Not that I'm a Great Trader or a Great Speculator, but there are certain Fundamentals I like to check before entering a trade. I want to know how attractive the stock is likely to be to investors. If it looks good for longer-term, then perhaps the stock will become more of a runner with the extra volume brought in by nontraders. Obversely, if the Fundamentals are poor, it means that any price appreciation will have to be accomplished without the help of the investors who act primarily on Fundamental Analysis (FA). A good example of the former would be HAUP. It has excellent Fundamentals. I believe that the volume in HAUP on the day it ran from 14 to 28 (back in May) was partially attributable to its attractiveness to FA investors. FA tells me something about how I want to play the trade. The poorer the FA, the more alert I am to danger and the quicker I am to scalp; the better the FA, the looser my stops and the more likely I am to let it run if it becomes a winner. What Fundamentals do I check? It takes me about two seconds to scan across these before going long: Long-Term Debt/Equity -- should be less than 1.0. Price/Sales -- should be less than 1.5. Profit Margin (ttm) -- should be positive. RoA and RoE -- should be positive. A glance at these numbers tells me quickly if the company is for real, a deal, or a disaster waiting to happen. It also tells me something about who else is trading that stock. That affects how I play the trade. If I am in with J.Q. Public, then the chances of catching a long wave, a Play Of The Day, are increased; but if I know that FA investors are excluded from the trade, that I am in with only the volume provided by traders, then I play accordingly. ig