IBD top 10 psychology.

R

rateesquad

In this thread I will compare the top 10 stocks given by the IBD.

I will compare their price action, their volume to the their normal actions as well as overall market. If everything goes by plan I will post the results in the end of the week via excel.

What I will try to accomplish by this is, see how much "stupid/noob money" will get into or out of the stock due to recommendation.

I will include some basic fundamentals with the stock.( Keep in mind that I do not use fundamental in my trading, nor do I base my trades on fundamentals.) This is not a trading method it is primary intention is to notice if more money/volume gets into stocks, on the buy side of course.

If I think particular stock has an interesting chart I will post it. Keep in mind that I have scalled back on my equity trading. Although, I still trade them. I trade futures and forex more often.

Hope this will be a good one!

Cheers.:)
 
This is a IBD top 10 for 1-3-07 to 1-5-07

1.MREP CORP (AXR) Engaged primarily in magazine fulfillment and newsstand distribution services through its cable news subsidiary.

2.U S GLOBAL INVESTORS INC (GROW) Provides investment advisory, transfer agency and record keeping, mailing, administrative and distribution services.

3.EZCORP INC CL A (EZPW) Operates 280 pawnshops and 288 ezmoney payday loan stores in 11 states offering merchandise sales and pawn/payday loans.

4.SYSTEMAX INC (SYX) Markets pcs, servers, disks, and various industrial products via 22 specialty catalogs and 7 e-commerce websites.

5.BOLT TECHNOLOGY CORP (BTJ) Manufactures seismic energy sources and underwater electrical components for seismic exploration of oil and gas.

6.FIRST MARBLEHEAD CORP (FMD) Provides outsourced loan securitization and related services for private education lending in the united states.

7.GUESS INC (GES) Operates/licenses 320 stores in north america and 353 stores outside of north america offering apparel and accessories

8.VOLT INFORMATION SCIENCE (VOL) Provides temporary and permanent staffing for businesses in the u.s., canada, europe and asia.

9.L H C GROUP INC (LHCG) Provides home-based and long-term medical care services via 81 locations in al, ar, la, ms, tx and wv.

10.TENARIS SA ADR (TS) Luxembourg manufacturer of seamless and welded steel tubular products.
 
AXR and GROW seem particularly interesting considering their low float size and high rankings. Usually smallcaps do quite well in january, I would like to see how these two do.
 
Day one is over for the experiment.

Alrighty then. 6 out of 10 stocks were up. VLO btw was up 2.57%

5 out of 10 stocks have at least doubled its volume. 8 out of 10 stocks exceeded the 150< mark in volume. All of the stocks have at least met its avg. volume.

I have posted the excel version of my hypothesis.
Overall it was an ok day for IBD 10 stocks. Of course we had two really big down killers, GROW and BTJ, down 4% and 12.47% accordingly. More in the excel.

Happy trading.

PS if anyone know or thinks they have a better way to use excel for this please be free to comment.:)

QUESTIONS???:confused:
 

Attachments

Quote from rateesquad:



PS if anyone know or thinks they have a better way to use excel for this please be free to comment.:)
More...

RateeS,

High lite row 1 of your spreadsheet all the way to S or so.
click format - cells -(a new box will open) - alignment.
about a third of the way down you'll see a box that says text wrap. click it.

you can now type all your text in one cell without bleeding over. Row one will become longer, but you'll end up with more room for your numbers, and keep all the text in one row.( more organized)
 
Once a stock in the ibd makes it to the top 10 it has normally run its course. I guess you are trying to prove this and you should have no problem proving it. I have never tested this but I would think stocks that make it on the lower part of the list for the very first time do very well.
 
Quote from HolyGrail:

Once a stock in the ibd makes it to the top 10 it has normally run its course. I guess you are trying to prove this and you should have no problem proving it. I have never tested this but I would think stocks that make it on the lower part of the list for the very first time do very well.
More...

Nice hypothesis. Maybe it will work.
I will keep that in mind, btw.:)
 
Well Its Day # 2 of the experiment:

Let me tell you out right now. It was not a good day for IBD 10.

5 out of 10 stocks were up.

The volume have doubled only in 3 out of 10 stocks. The volume have exceeded 150+ mark in 6 out of 10 stock, and only one stock had vol below it avg. vol.

GROW had taken it to the chin again, plummeting 11.53% on top of 4% yesterday. Surprised winner today was SYX adding 9.34% on top of yesterdays gain of 3.72%.

Overall, high volume is still holding up but is dipping slowly. I will keep in tune tomorrow posting the final results, until then go over this attachment.

PS I have added a new future, the moves of major indexes. This will help with the experiment more. If you have more ideas shoot them at me.
 

Attachments

As I was reading my daily websites that I follow for information, studies, etc. I have found this.(look below) So, I though this is close(maybe not) to what I am doing on ET....well its same thing as trader sentiment, whomever that might be. Right here it is.
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That post examined extreme indicator readings and their implications for future price change in the S&P 500 Index. In this excursion, we'll take a look at a sector relationship: how the behavior of energy-related stocks--the Energy Sector Spyder ETF (XLE)--might be related to future movements of the large cap S&P 500 Index.

Thanks to a falling crude oil market, over the past 20 trading sessions, XLE has been down more than 5%. Going back to 2004 (N = 737 trading days), we've had 211 daily occasions in which XLE has been down more than 1% over a 20-day period. Ten days later, the S&P 500 Index (SPY) has been up by an average of 1.03% (161 up, 50 down). That is much stronger than the average 10-day gain of .05% (288 up, 238 down) for the remainder of the sample. It thus appears that falling energy markets are associated with superior near-term returns, perhaps because traders view such declines as helpful to the economy.

Indeed, that would seem to be the case. When XLE has risen by more than 5% during a 20-day period (N = 242), the next ten days in SPY average a loss of -.31% (113 up, 129 down). That is much weaker than the remainder of the occasions in the sample, which average a 10-day gain of .64% (336 up, 159 down). When energy is on the rise, markets have been performing subnormally in the near term. Knowing these sector relationships helps traders anticipate market movements, but also can help them understand when markets are not living up to their usual performance: useful information in itself.

In my next post, we'll examine yet another example of a historical pattern: this one linking entirely different markets.

By Brett Steenbarger
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Very interesting.
:cool:
 
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