Quote from Trend Fader:
One thing i noticed in your picks is that you tend to buy very high relative stocks that apear to be extended on the charts..
This strategy will work well in a strong bull market.. but in a sideways to down market.. you will not do well.. u will be forced to use wide stops..
I remember you will very bullish on LIFC a few weeks ago.. as it was carving its top.. the point is that you have to adjust your entries based on the markets..
Yes in a full fledge bull market like we had a few years ago.. chasing momo ala IBD cup and handle breakouts was the way to do it.. but now the market internals and characteristics are not the same..
My biggest prblem with CANSLIM and IBD.. is that it has its sweet spot when we are in a full fledge bull market it will get you into the strongets stocks that will make you the fastst money no question about it.. but the majority of time this is not the case.. most of the time ( especially) going forward the market is going to boring and chopping around where this strategy will clearly underperform... when you trade for a living, especially manage money in a sideways market.. u dont have the luxury of waiting for the perfect bull market to make money.. bceause other money managers will be using models and systems that are working in this environment.. and your investors will bail out bceause you are not performing...
--MIKE
