I previousy subscribed to Investors Business Daily. At one time this paper served a useful purpose, but now the same information is available either free, or for a much lower cost at sites like Stocktables.com. I have strong opinions about William O'Neil (WON), IBD, which he founded, and the CANSLIM method of investing he tirelessly promotes. These opinions are my own, and I should say in fairness that he has many loyal followers.
Basically CANSLIM is a gimicky momentum method of investing, more so than trading, though he never promoted the idea of "buy and hold". It is in its essence a method of identifying breakouts and exploiting them. It works well in strongly up trending markets, markets in which even a Chimp can make money, but is otherwise of little value. The stocks best suited to the CANSLIM style of investing do have one attribute in common: they are almost without exception among the stocks that fall the furthest in bear markets. This is not an attribute that is dwelled on to much extent in his well-known books.
WON did, in his early days, make significant contributions to investing by researching the markets and compiling and publishing useful statistics regarding distribution and accumulation days, etc. and their significance. In particular he places great store in base building, cup and handle patterns, and breakout investing. His methods and investing philosophy are somewhat dated. He has attempted to boil stock investing down to simple rules, but unfortunately rules alone are not sufficient for consistent success at investing, good judgment honed through years of experience is also required.
One example of the very bad advice he gives in his hopelessly outdated books is to avoid investing in foreign stocks. That should give you an idea. He is a rabid right-wing conservative, highly opinionated, as am I, and he uses the editorial pages of IBD to promote his brand of conservatism. IBD is outrageously expensive, considering that the information it contains is now available at much lower cost elsewhere. The IBD website uses outdated and poorly written software, dependent on Microsft Internet Explorer for full functionality and other Microsoft features that make it troublesome to use for anyone using Linux, or non-microsoft browsers.
If you subscribe to IBD you will be inundated with IBD promotions and a constant stream of advertising on its web pages. IBD wants to sell you an endless list of "add on features", seminars etc. Although I have never met WON, My personal view of him formed through my former use of IBD and reading two of his books, books that are not particularly well written, is that he is first and foremost a business man out to make a buck. And he certainly can't be faulted for that. I just don't want it to be at my expense. I personally consider him to be a charleton and a snake oil saleman. Again this is only my personal opinion, and he does have many very loyal followers. Regardless, there can hardly be anyone alive on the planet who is more indefatigable at self-promotion. That said, my recommendation to anyone would be, give CANSLIM and IBD a try, you might find it more useful than i did. Afterall, what do you have to lose? Just $246, and that's a small price to pay for enlightenment.
