Catching the falling knife.....hot through butter

[iriekity]

Long IUSA at 7.65

 

[iriekity]

Long BFUN at .99

 

[iriekity]

Both BFUN and IUSA are working well today.

 

[lindq]

Quote from MackieMesser:

OK, thanks.

This has gotten to be a popular strategy lately (there is another thread here on ET all about these types of oversold stocks), so I have to wonder how long it will work.
m

So far buying the stock of good companies on weakness has been around for about...oh, 400 years. So I wouldn't worry about the strategy getting overplayed! The trick is the level at which you are buying, the fundamentals of the company, and the tune of the overall market that's playing in the background. A bull market can cover a lot of sloppiness in the strategy. But when things flatten or go south, that's what separates the men from the boys.

 

[Bob111]

Quote from iriekity:

I have been able to really get some high % returns so far so that is why I decided to put some of this in a journal for others to see.

my guess that this strategy may work on bull market, but will fail on bear. i have plenty of system that work well in different kind of markets, but only couple work in both bull and bear. the only a question-how you will figure out -where you are now.))))

peace

 

[iriekity]

Quote from Bob111:

my guess that this strategy may work on bull market, but will fail on bear. i have plenty of system that work well in different kind of markets, but only couple work in both bull and bear. the only a question-how you will figure out -where you are now.))))

peace

It is all about the now as far as I am concerned. The key is to make money today and not worry about tomorrow that is what money management is for.

 

[Volker Knapp]

Quote from iriekity:

I am going to start a journal of a strategy I am trading live. I am selectively buying (going long) stocks down 9-10 days in a row and looking for the turn. Buying on 75% Pullback from lows and the stop is at new lows. Here is what I am in right now.

From last Thursday
FIC
CMRG
EMKR

From Friday
YCC
FMKT

Today
LNCR

Will keep all posted

With all respect to your idea and the strategy from the web site, but you should test this strategy first. I would asume that the idea is easy to code. You could then backtest it on a portfolioor your personal portfolio called WatchList on the www.wealth-lab.com site. I would never trade a system that I have not personally backtested. To take it a step further I would not only backtest it on the selected stocks but also on a different set or the whole NASDAQ 100 stocks.

 

[iriekity]

Quote from Volker Knapp:

With all respect to your idea and the strategy from the web site, but you should test this strategy first. I would asume that the idea is easy to code. You could then backtest it on a portfolioor your personal portfolio called WatchList on the www.wealth-lab.com site. I would never trade a system that I have not personally backtested. To take it a step further I would not only backtest it on the selected stocks but also on a different set or the whole NASDAQ 100 stocks. [/QUOTE

Sorry but I disagree. I don't have fear that I am wrong, I am very confident in the analytics alerts software that I use, which helps alot, and money management takes care of the rest. The time one spends back testing is the time I am riding a trend with real money on the line. In reality it is to each his/her own. I have been doing this for over 15 years and wasted quite a bit of time searching for the holy grail vial neural nets and TradeStation etc. At the end of the day I let P/L decide what I am going to stay in and what I am going to cut it is that simple.

BFUN is going up 16% and proving that the only way you are going to win it is if you are in it!

 

[Volker Knapp]

Not saying that you will find the holy grail but may be knowing if a strategy works. I was just trying to help. Good luck!

 

[iriekity]

I hear ya I was not trying to knock your advise I just have a little different approach. I appreciate eveyone that contributes to this thread. I really think there is some money to be made here and hope others benefit.