Top 5 Growth Stocks | Investing for Solid Long Term Gains

We’ve had a huge rally since the march lows, and my current stance is that we should see the collapse of this massive bear market rally any day now.  That being said, prices on some stocks are low enough that given their growth potential, you’d probably do fairly well for yourself even if you bought now, near what is likely the high of this bear market rally.  Of course, you may be able to do better by timing your entry, waiting for a pullback in the major indices before pulling the trigger, but for the more long term investor, now is as good a time as any.

To find these companies, I used a combination of fundamental and technical criteria, searching for the best companies in a decent technical position.  Here are the companies I uncovered. Read the rest of this entry »

Triple Leveraged Arbitrage

This is a long term play you’ve NEVER heard of.  Its not quite arbitrage, but it does have some similarities.  Its similar to an arbitrage strategy in that you have a long position, and a short position on the same underlying.  In other ways its like selling call options dated fairly far out, in that the odds are highly on your side, and it should slowly but relatively safely make money over longer time periods.  Yet the reality is this play is like nothing you’ve ever seen. I call this ETF strategy: Triple Leveraged Arbitrage.

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Sector Update

I posted an article about using BP indexes a couple days ago.  When the article was posted, a number of sectors were overbought, but it wasn’t a sell signal yet because they hadn’t entered a column of Os yet on the Point and Figure chart.  That situation has changed.  The Financials, Consumer Discretionary, Industrials, and Materials sectors are now all showing sell signals on the P&F charts, so anyone who is long those sectors should lighten exposure, and anyone looking to short them into a reversal has an added indicator to confirm that move.  The overall market, as represented by the S&P 500 isn’t showing a sell signal yet, but with so many sectors switching from overbought to sell signal, there is a strong possibility that this bull market rally is nearing is nearing its climax.

That being said, its important to note that the last time financials gave a BP chart sell signal, it turned out to be a head fake, and people shorting on that signal would have lost money.  Still, this signal is right far more then its wrong, and traders should keep that in mind in the coming weeks.

Stock Trading Strategy: The Bullish Percent Chart

In my previous article on stock trading strategy, I showed you how to use relative performance to decide what sectors you should be buying and selling.  In this article, I’ll show you how to use a little-known tool to call reversals in the major economic sectors.  What is this little known tool?  Its called a Bullish Percent Index, or BP Chart. Read the rest of this entry »

Picking the right sector

The vast majority of your returns are determined not by what stocks you choose to invest in, but what industries you choose to invest in.  With this in mind, one of the key things you should be doing when investing is deciding what sectors you think will do the best.  How do you do this?

Determining what sector should do well is actually a fairly simple task.  It’s all based on the observation that markets trend.  Day to day fluctuations may be fairly random and unpredictable, but the effect of those day to day fluctuations on the stock price over a period of months is generally consistent, weather it be up or down.

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Stock Option Strategy: The Vertical Leap

Most people view stock options as strictly a short term tool. This is because the idea of a highly leveraged instrument with the potential to make big bucks quickly appeals to the gambler inside all of us. Just like a card counting black-jack player, options can be used to make short term profits, provided the user is careful, and knows what they’re doing. But while options are usually employed solely by that group of high-octane traders, they actually have enormous benefits that tend to go unnoticed by many a long term investor.

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