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Strategies & Market Trends : Momentum Daytrading - Tricks of the Trade -- Ignore unavailable to you. Want to Upgrade?

To: William W. Dwyer, Jr. who wrote (1934)	4/18/1999 12:05:00 PM
From: Sir Francis Drake	Read Replies (1) \| Respond to of 2120

Thanks Bill - the way I see it, my trading method is every bit as safe as the best kind of buy and hold (the best, because like Buffet, I try to select only the very best stock - VALUE), but MORE profitable. As to Ken's method - is it really more profitable? Hmmm... What I do know, is that my method is as safe as is possible in the stock market. How can I make such a bold claim? Think of it this way - you go out, and choose the best stock the market has to offer. If Buffet can do it, so can you - in the worst case, you can copy him. The point is, if there is ANY stock that can be called - in the top ten, or top three, you pick it - by the most stringent criteria. Buffet said the reason he doesn't hold more than 10 stocks, is because he can't find more than 10 stocks out of the thousands out there that pass his muster. So, if you apply the same tough standards, basically you are looking at the best the market can offer you. Sure, nothing is 100% safe, but that's the nature of the stock market. I'm simply saying that its as close to absolute safety AS THE MARKET ALLOWS. That is why I do look for VALUE, and why I made my original post in response to Ken. I say, far from value not being important to me as a trader, it is of PARAMOUNT importance. Now, I take that safety, and add bigger profits through my trading method, which I regard as a very safe method (as I pointed out to Crispin). For me to fail, I'd have to do so many things wrong, it's just not statistically reasonalbe. I'd have to select Boston Chicken as my best stock. Or, I do select the best stock, and just as I start trading, the stock suddenly tanks dramatically and NEVER recovers - what are the odds there - I'd have to be one unlucky bastard to select the best stock, and for it to tank to zero FOREVER just as I got into it. But wait, not only would I have to have that bad luck, but I'd also have to be the world's very worst brain damaged investor, who after TONS of fundamental analysis, still doesn't see that the stock is going down to zero. Then, I'd also have to be the world's worst trader and most unlucky trader in addition. Not only did I get unlucky with the stock, I bought stupidly at the top, a top the stock will never see again - I was the last high trade in that stock. When you add up all the things that would have to happen for my trading method to fail, you'd have to say it's highly unlikely. And if it did, then guess what - buy and hold would not save me. Because that would mean that I bought and held a stock that collapsed never to come back, and I bought high! So, bottom line - my method of trading is every bit as safe as the safest buy and hold or the best the market has to offer. And it is MORE profitable than just buy and hold of such a stock. Maybe Ken's method is better, more profitable and so on, but my method has worked for me so far.