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S&P 500: 1,312.55 Change: -0.16%
JaiH
P&P Score: 99.63   Points: 144.74   Accuracy: 53.00%   Average Pick Score: 0.64   Annual Return: 9.03% (24.00% since 9/27/09)  

JaiH's Blog : Beat Warren buffet Service- A free service on P&P

Date May 10, 2010    Comments Comments (16)    Rate this post Recommend This Post (65)   
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I want to introduce you to my new strategy in the research wizard which explodes 10000$ with a 413.9% Compounded growth rate into about 50 billion dollars in ten years. The strategy is properitory but I will be posting the picks every week every sunday so you can have the picks available before market opens on monday. The results have been backtested in the research wizard from 01/05/2001 to 04/09/2010 with two intervening bear markets in that period. You simply split your money in buying the posted picks on mondays and sell the stocks next moday and buy next weeks picks.

I will be posting picks every week from three strategies, a high risk high return strategy, a medium risk, medium return strategy and a lower risk, lower return strategy.

The high risk strategy has a maximum drawdown in the tested perod of -51.8% and has a compound growth rate of 413.9%. It uses uwpltre's ideas to get some penny stock picks to enhance returns The penny stocks picks are high risk but they enhance the overall returns and mixed in with my properitory strategy, the downside is limited.

The medium risk strategy has a maximum drawdown in the tested period of -36.0% and has a compound growth rate of 291.3% It also uses uwpltre's ideas to get some penny stock picks to enhance returns, but the downside is more limited than the high risk strategy.

The lower risk strategy has a maximum drawdown in the tested period of -25.2% and has a compound growth rate of 194.7%. It does not use any penny stocks and picks only stocks with a price of 1.50$ or more. It also diversifies picks in three different sectors for diversification purposes. This strategy is good for retired people like me and I use this one.

Although the high risk strategy has the potential to overtake warren buffet as thye richest man in ten years time for an average person. In reality it will be hard to do so, because of limited number of shares you can buy of a small company without moving the markets. Also the market cap of the companies is few hunded million dollars so you cannot invest large sums of money for a one week trade.

Although I get picks every day from the strategies, I will only be postting the sunday picks in the free service. The strategy is open for sale for 20 million dollars if you want to own it. And if I can sell it I will pay 5% to uwpltre for using some of his ideas. The daily picks only help you diversify more and smooth out the ride but they donot enhance performance.

Investing in stock markets is highly risky, donot invest money you cannot afford to lose. All these three strategies invest in small cap stocks which are high risk. I am not a financial advisor and you assume all risks if you invest in thes picks. I am a software guy I can make the research wizard sing to my tune, I am not even an experienced stock trader.
Tags : BEAT WARREN BUFFET  

16 Comment(s):

Author JoeJustJoe     Date May 10, 2010 22:37 Abuse this post Report Abuse
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From this day forward...every time somebody mentions Warren the Buffoon's name in a blog I am gonna post my long term target fer BRK.B. Here it is >>> $37 dollahs. Watch what I do to Warren Buffoon. *-) 3J
Author Neurodoc     Date May 11, 2010 01:11 Abuse this post Report Abuse
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The usual RW backtesting caveats:
1) Backtesting is based on the Fri close--stocks are identified Sun, and the Mon upgap distorts weekly backtesting
2) Performance can change, although a 9 yr record if consistent would seem adequate.
Big question--what are your real-life returns following this??
Author JaiH     Date May 11, 2010 06:20 Abuse this post Report Abuse
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Nerodoc

The real life returns are not impressive. I had a problem with panic selling I overcame that. Also I would sell too fast,lock in the profit, I don't do that anymore. I am only following it recently and the market is not good right now.
Author JaiH     Date May 11, 2010 06:23 Abuse this post Report Abuse
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Neurodoc

But the picks got me a good score on P&P so the picks must be good. I wouldnt panic sell on P&P.
Author JaiH     Date May 11, 2010 06:42 Abuse this post Report Abuse
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Nerodoc

The Friday close doesnt matter if you buy monday morning so you sell monday morning too, the Mon upgap will statistically cancel out in t6he long run.
Author Neurodoc     Date May 12, 2010 01:45 Abuse this post Report Abuse
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I thought of that, and it may or not be true. A timely buy can gap up perhaps better than that stock a week later as a sell. The point is that such assumptions are simply that--assumptions. Now if RW were able to backtest in a way that is exactly replicable in the real world, that would be great. I asked Kevin Matras about this, but I guess it is technically too difficult for the program. Nevertheless, you may be on to something significant--good luck and I look forward to your future posts!
Author klaczakm     Date May 12, 2010 20:33 Abuse this post Report Abuse
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I would like to try your low risk strategy. The only part I find a little tricky is putting in stop loss orders or actually investing without them in place. For example, If I sell the weekly portfolio of stocks on Friday pm or Monday am, then I'm replacing them with new stocks on Monday am--I can't sell those stocks for three days until the funds I used to buy them have become settled funds. Therefore, I can't protect myself with a stop loss order until Thursday, this would leave me with three days at the mercy of the market.

I think I would prefer to buy in on Monday with settled funds, put in my stop loss orders at the same time and then either hold them or sell them individually depending upon their performance--probably within the week. I probably won't be able to update the complete portfolio weekly unless I wanted to sell the stocks at the end of the market day on Tuesday and then sit out until Monday when I have settled funds and new picks, but this only gives me two days in the market. The only way I can see to use your system weekly as designed is not to use stop loss orders until Thursday. Is this correct or am I missing something?

What insight can you give me?? Do you see my dilemma?? How are you planning to manage these weekly buys and sells? Do you not use stop loss orders? Any info. is greatly appreciated!! Thank You Much!!
Author Neurodoc     Date May 13, 2010 01:10 Abuse this post Report Abuse
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K--do you have a cash IRA account that limits your trading? Otherwise if you have a margin account, you won't need to worry about simultaneous weekly buy/sell orders and 3 day settlements and could follow your strategy more precisely.
Author klaczakm     Date May 13, 2010 06:34 Abuse this post Report Abuse
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I'm using funds from a Roth IRA. Active trading using a Roth definately obstructs the ease of selling, but also protects gains from taxation. This is why I'm looking for some input on how to modify the above strategy for my application. I'm thinking that in any given week my portfolio will be in a blend of at least two weeks picks combined with cash waiting to clear. How important is it that the stocks are replaced on a wekly basis? Thank You Much!!
Author JaiH     Date May 13, 2010 06:40  Edited: May 13, 2010 by JaiH Abuse this post Report Abuse
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The performance drops very rapidly if I test for 2 week hold. I am a Canadian and i can sell and buy in my retirement account almost immediately. I have no clue about american IRAs.
Author JaiH     Date May 13, 2010 06:53 Abuse this post Report Abuse
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For the lower risk strategy the peformance numbers get cut down to 112.4% compound growth rate over the same time frame.
Author klaczakm     Date May 13, 2010 10:13 Abuse this post Report Abuse
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JaiH
I can sell a portfolio of stock on Monday and then within the same timeframe purchase a new portfolio of stock. The problem arises if I choose to sell the stock within three days of the first portfolios sale. This creates IRS problems. If I was to follow your strategy, I could do it weekly on Mondays, but I wouldn't be able to put in stop loss orders until after the market closes on Wednesday or later.
Therefore, I will end up doing some type of modified approach to your strategy. Any suggestions? Also, when are you planning to post your picks --Sunday morning--afternooon--evening?? I assume they will be accessable via this blog? Any input is greatly appreciated!!! Thanks Again!!
Author JaiH     Date May 13, 2010 10:18 Abuse this post Report Abuse
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I will be posting them sunday around noon, gives you time to research stocks.
Author klaczakm     Date May 13, 2010 11:39 Abuse this post Report Abuse
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JaiH
Thank-You Much, I'm looking forward to your picks on Sunday! If you're interested, I can keep you informed about the performance from my modified approach. Also, I'm intending on using stop loss orders with your picks--the actual percent I choose will vary depending upon the average daily volatility of each stock. Do you intend on using stop loss orders? If so, any idea what percentage change on average you would be setting your stop losses at, or within what percent ranges you have succesfully used in the past?
Author JaiH     Date May 13, 2010 11:43 Abuse this post Report Abuse
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I am not using stop losses, i monitor my picks everyday
Author klaczakm     Date May 13, 2010 12:14 Abuse this post Report Abuse
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I am intending to use stop losses because I have had the unfortunate experience of riding certain stock down, where as if I had a stop loss in place it would have limited my losses. Unfortunately, this also locks in my loss and doesn't give me the opportunity for the stock to turn around. Stop losses are definately a double edged sword. So, pick your poison. At the present time, I'm choosing to use them.

I monitor daily as well, but I'm trying to take out the personal influence/decision of choosing to hold onto a stock that may fall fast and hard or accumulate losses over days that really eat into the bottom line. I intend to take my losses when I have to, but grab my gains as well. If at the end of the day/week/month I'm garnering a decent return then what else can I ask for?
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