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Strategies & Market Trends : Point and Figure Charting -- Ignore unavailable to you. Want to Upgrade?

To: Ms. X who wrote (87)	1/25/1998 7:06:00 AM
From: Mr. BSL	Respond to of 34808

P&F-Madness, thanks for the valuable information. My current inventory is S&P 500 stocks that are in one of the 198 Chartcraft sectors that have at least 12 stocks in that narrow sector. For example, sector 59 Energy-Coal only has five stocks in it and would not make the cut. Value Line 1 & 2 stocks are a screen criteria once a sector goes Bull Alert or Bull Confirmed. I think I'll further narrow the inventory to sector "pure plays" only, perhaps by including only those stocks whose Chartcraft narrow sector group and IBD narrow sector designations match the DWA wide sector group. I'm impressed with the approach your broker friend is using. Let us know when the next book is ready. duke60

To: Ms. X who wrote (87)	1/25/1998 5:23:00 PM
From: Ms. X	Read Replies (1) \| Respond to of 34808

Tom Dorsey on options... Never average down in options. It's the kiss of death. Consider Michael Jordan. Lets say he is a 70% free throw shooter. He is given a personal foul where he can take two shots at the basket. At 70% he is a 49% probability of getting both shots. That is .7x.7=.49. You as an investor have the same problem you have to successfully complete two indapendent events to be successful at stocks. You must buy the stock right and sell it right. If you are a 70% stock picker you have a 49% chance of success. In options, you take this two steps further. You must select the right expiration date and the right expiration price. If you can do both of those right 70% of the time you have .7x.7x.7x.7 or 24% chance of success. This is why it is important to use in the moneys as stock substitutes, buying time. This will eliminate the strike price problem and the expiration date problem and bring you back much closer to the stock itself. Tom