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May 6, 2011
Edited: May 6, 2011
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I finally figured out how to get a diversified portfolio with equal weight stocks with research wizard. All you have to do is to modify your strategy with the stocks you currently own and research wizard will give you a different set of stocks. It means you have to modify the strategy every day after you buy the recommended stocks. But it only takes a few minutes, so it is alright.
I have expanded my search for stocks to Zacks rank 1,2 and 3, So that I have enough stocks to diversify in. It actually improved my results a little bit, so there are some fine zacks rank 3 stocks. The zacks rank sell stocks degrade the performance so I stay away from them ( We will just let Rimmie buy them).
I only had 15 stocks this week (equally weighted) and I did alright for the week, even though small caps had a big down week. The hedge saved the week for me, even though I was only about 30% short. So for now I will continue to diversify in 15 stocks with equal weighing. I will also follow the one week hold. So I need to trade in and out of 3 stocks a day. This gives me the best performance (better than 25 stocks).
Now that I figured how to equally weigh your portfolio, I have changed the price I will be willing to sell this strategy to anybody interested. It is now 5 million dollars Canadian plus applicable Canadian taxes and the price is no longer negotiable. It has a compound annual growth of 141.6% and draw down of 26% (from 07/13/2001 to 04/22/2011 1 week holding period). I think this is a fair price. The best strategy that comes with research wizard has an annual growth of 47.8% and a draw down of 47% (from 07/13/2001 to 04/22/2011 1 week holding period) if you compare apples to apples (price greater than 1.5 dollars, market cap 100 million or more and a dollar volume of greater than 500000 a day). That zacks strategy does not pass my 2 week hold robustness test. You get a wide variation in the results for alternate weeks. So the zacks strategy will not have predictable results in the future. You get what you pay for.
The picks for next week are:
(AKRX) – buy
(TSYS) – buy
(CRD.B) - buy