Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : A.I.M Users Group Bulletin Board -- Ignore unavailable to you. Want to Upgrade?

To: OldAIMGuy who wrote (3692)	12/28/1997 5:40:00 PM
From: Bruce A. Bowman	Read Replies (1) \| Respond to of 18928

Hi Tom- What you posted makes me realize that this is Value Line data and not something that Charlie invented. Oops! I think I see what he's looking for, though. I think his premise is that a large value, given consistency in earnings et al, represents the best chance for a large reversal. So the large number represents the largest pressure for movement (I think!). So if that's the case, and assuming he's right from a statistical perspective, I think the large number might represent a good entry point since it would be near the low and a long way from the high. A lot of fundamental things can affect it, of course. In fact, consider this: assuming there's reason to believe that the stock will reverse (fundamentals), how about multiplying the IW recommended reserve by the sum of the 2 deltas, which is a negative number for a depressed stock. The largest was something like -60%. It's a stock that's very near its lows and a long way from its highs. The IW recommendation is currently ~50% cash reserve. Using the -60% value, that might suggest 20% as a cash reserve to start the account. A stock near its highs would have the reverse situation because the sum would be positive and would suggest that greater reserve is necessary. Does this have any ring at all of validity? or am I raving again?! :-) Bruce