Articles

When you decide you want to own stocks, the question is what stocks to own.  The simple answer to this question is we want to own the stocks that give us the most appreciation.  We might add to this that we want to own a group of the best performing stocks so we reduce the volatility of our portfolio through diversification. What are the strongest stocks?  In the attached article, market analyst, Dorsey Wright, brings real-world testing to high relative strength stocks.  High relative strength stocks are the group of stocks that are rising faster than all the other stocks.  The good news is these stocks can easily be identified and bought.  The better news is that even though they have already shown strong appreciation before you buy them, they continue to run faster than the market after you buy them.  In the real world test that Dorsey Wright conducted, he finds this to be true 100% of the time. From the results of our own real world money management services, we agree.  Click here for the report.

Warren Buffett’s first rule of investing is don’t lose money.  His second rule if don’t forget rule one.  The reason Warren is so focused on not losing money is it is so hard to make it back.  If you lose 50% in a stock, the stock has to appreciate 100% to get back to break even.  Too many stock investors have experienced this scenario with great frustration.  We are not all Warren Buffett’s with his proven market timing skills.  On the other hand, the attached study shows that there are simple, non-emotional ways to know when to be fully invested in stocks and when to be out of stocks.  It turns out, it is not hard to follow Warren’s first rule of investing if you apply the simplest and probably the oldest trading system invented, the moving average crossover. Click here to read Moving Average: Holy Grail or Fairy Tale – Part I, click here to read Moving Average: Holy Grail or Fairy Tale -Part II and click here to read Moving Average: Holy Grail or Fairy Tale – Part III.