CANSLIM & Momentum Investing 01 (May 08 - Jul 09)

[Aspellian]

I prefer to short stocks where their fundamentals are detiorating and where they have a chance of going to zero.

Hi Winston,

how about shorting stocks that have went up alot (eg. 300 - 400%) during a market upturn? during market downturn, lots of people will want to profit-take, right?

the risk of shorting a company with bad fundamentals is that it may end belly-up/suspended (TT International, celestial, oriental etc), unless you are shorting an index stock or blue-chip?

I was thinking SGX is a nice gyrating stock to short, any comments on this?

Shorting index stocks and government linked stocks are very dangerous.

Take care,
Winston

Can you elaborate on this? i will think that most counters are cyclical (not the stable-dividened companies eg. ST eng, SPH, smrt etc), so they will still gyrate according to market direction? or the GLCs and indexes have more big boys playing and they will catch the shortists?

as always, i appreciate your advice!

[kennynah]

I prefer to short stocks where their fundamentals are detiorating and where they have a chance of going to zero.

Hi Winston,

how about shorting stocks that have went up alot (eg. 300 - 400%) during a market upturn? during market downturn, lots of people will want to profit-take, right?

the risk of shorting a company with bad fundamentals is that it may end belly-up/suspended (TT International, celestial, oriental etc), unless you are shorting an index stock or blue-chip?

I was thinking SGX is a nice gyrating stock to short, any comments on this?

not a good idea... why would you expect a stock to drop just becos it has rallied for 3 - 4 folds? your reasoning that becos peoplewill want to take profit is an anticipation of an event happening...that may not happen at your entry price...

bro asp : you have been around in this forum and other financial forum for sometime now... i am sure you are NOT a noobie in investing, no ?

[Aspellian]

Hi A Bro,

I am not good with shorts (cos' I am very tall haha.. lousy joke... but seriously, I am a tall dude), so I just target a certain %tage which I will take profit. I make most of my profits on the long side...

Another point on shorting, when market breaks, the market will typically drop a few days before attempting a rally. That is when I usually will close my positions when my target is hit.

Yes, follow thro's do fail. See my posting on Jan 29 and Jan 30.

viewtopic.php?f=65&t=1679&start=100

Hope this helps.

Cheers,
mm

You are damn FUNNY!! I especially like your "SMILE AND LAUGH" thread.

back to short - so usually you will go away after a week of down market (before the rebound). is there any reason why? is it because market falls the most during the 1st week of downturn confirmation but alot of people will buy on on dips?

an elementary question, why is it in your opinion that longs are easier than shorts? (eg. you invest only 1/3 of $ in shorts vs fully invested in longs?) what are the challenges of shorting?

(oops... sorry winston - i know this qn should be under the shorts discussion thread)

Edit (mistake: i like "smile and laugh" more than crab thread)

[millionairemind]

The first few days of falls are usually the greatest.. that is all.

Longs are easier because ppe. are hopeful by nature and I am a die hard optimist. I have to be, in order to survive as a trader, esp. after the market wallop me real bad. haha..

Another thing is most ppe. are trained to go longs.. so when market follow thro' and unless there is a specific reason for it to break again, typically, I don't get stopped out at 7% when I enter my positions.

[winston]

Hi A,

If you short a Govt Linked Company, they have alot of fire-power to support the counter.

I prefer to have a good reason why I'm shorting the counter. Price Action alone is not an adequate reason.

Take care,
Winston

P/S We can discuss SGX in the SGX thread. It depends on where u see ADT.

[Aspellian]

not a good idea... why would you expect a stock to drop just becos it has rallied for 3 - 4 folds? your reasoning that becos peoplewill want to take profit is an anticipation of an event happening...that may not happen at your entry price...

bro asp : you have been around in this forum and other financial forum for sometime now... i am sure you are NOT a noobie in investing, no ?

kenny, noted on your point. i have never shorted, so trying to learn more.
I have been "investing" for a few yrs, thinking i am good (but i'm just lucky and in midst of bull run) but am wallop big time recently.

noobie? i think i am worse than a noobie...

[HengHeng]

well .. personally .. it is a paradigm that people put themselves in ..

You need to have a paradigm shift to change the way u trade ..

One way just think it this way .. buy or sell (long/short) is just a way of putting your thoughts to play .. just like buying 4D or buy soccer .. there is only 2 outcomes .. either u lose or you win ..

whats so hard ? .. can buy puts also mah .. same as short .. who tell u must die die .. SHORT the market .. buy puts lor .. if u not comfortable SELLING

sorry for hijacking .. LOL recently got sometime to post nonsense better post first later buzy cannot post again .. LOL

[kennynah]

heng heng...cb....u mia knn... welcome back

run road is ir?

[HengHeng]

ya run around busy .. LOL

[Aspellian]

Thanks Heng Heng for your reply.

wish that you get the property/properties you have been eyeing!