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Author: joelxwil Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 23033  
Subject: Re: CANSLIM track records? Date: 11/30/2010 8:09 AM
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I did fairly well several years ago using CANSLIM. However, it was extremely time consuming. Now I use Mechanical Investing, with Fasttrack and FastBreak.

Yes, the Fools held in a model portfolio a stock, 3COM, for a near double and then eventually sold it for a loss. After that, I paid no attention.

You need a buy discipline and a sell discipline, no matter what your method. So far at the 8% rule is concerned, it only applies if you buy at a CANSLIM buy point. If, for example, there is a cup and handle and you get in at the pivot point, the theory is that the rally fails if it goes down 8% from the buy point.

Some people say that CANSLIM only applies to small investors. A mutual fund has to make large buys and sells; hence it tends to move the market too much to get in and out at the optimal points. It is certainly true that is is more difficult to trade a $100 million portfolio of 20 stocks than a $1 million portfolio of 20 stocks.

Take a look at a list of stocks with allegedly good fundamentals. I say "allegedly" because it is very difficult to know such things. While you may look at the balance sheet and say that everything is good, you also have to know whether or not the companies products will be in demand, and that is much more difficult than financial analysis.

Anyway, look at that list, and see what happens if you buy and sell at the (8,32) moving average crossover. Then look at the 21 day moving average for buy and sell points. See how that works out and try other numbers as well. Remember, this is the selection part of the process. The other part is timing: Do you want to be in the market at all?

This has been a very volatile and frustrating market. There is a lot of fear: fear that you should not be in the market, and fear that you should not be out. Crazy days.
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