some ramblings to ponder, page-43

  1. MAP
    849 Posts.
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    Hi keygeo,

    I am a little hesitant to talk about my stock selection process.
    The main reason being that it works for me, it may not work for you.
    That said, I start with ASX300 stocks making 3 month highs and then look at estimated value to current price, strength of trend, and some technicals such as DMI, and EMA's.

    Of more importance is amount to invest in each stock, when to bail out for losers, take profit for winners, and tracking equity curve and profit/loss for portfolio.
    A real breakthrough for me was the realisation that most stocks are dogs and/or overvalued. FXJ and BSL could be called dogs but I saw them as undervalued. I struggled to buy FXJ for that reason (a dog) and often the correct thing to do does not feel right.
    After buying FXJ, I noticed that a lot of value style fund managers had bought in, then some positive news flow came on change of direction on digital and web focus.
    I am always researching and trying to learn.
    Lance Beggs is very good, he is more scalping and day trading (which I don't do) however he covers the business of trading (and investing).

    Number one as mentioned previously is to keep an open mind and react to price and to a lesser extent news flow.
    I find predictions that are published are very dangerous as they tend to encourage a closed mind. A prediction gives readers some semblance of certainty.
    Lance Beggs says that people want certainty, however, one will not get it when investing. By the time one is certain, the opportunity has passed.
    This gets into the realm of psychology around investing of which I am a huge fan.
    I am also in other stocks that are not performing at present such as BCI, RCR, CCP, SKE, and RMD plus a few others I am building positions in.

    Most people underestimate the amount of work required (I definately used to) and do mental short cuts.
    Another respected share market educator says that most people are hard-wired to not succeed in the markets, this is human nature. He says that it can be changed but it takes a lot of work.
 
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