For several months now I have been posting in the “Stocks I’m Watching” column to the lower right, TDSC. On December 10, I wrote about TDSC as an RWB stock when it was at $31. Judy brought this stock to my attention because she loved the concept. The company makes 3D modeling equipment that she found very promising. I had bought TDSC, but got shaken out in January when the stock dipped. The stock gave me another technical buy signal around $31 in early February, but I failed to act on it, even as Judy bought more. Well, the market woke up to TDSC on Thursday, when it reported earnings and shot up about 40%. I am going to start a watchlist of “Judy’s Picks” and monitor it daily for technical buy signals. Way to go– yet again, Judy!
For me the signal to add to my position was at $28 and change. I will see if I have time this weekend to write a tiny bit about how I manage trades.
Dr. Wish, another one Judy’s pick you bought and has gone nowhere is LYSCF. Did you get out of it yet?
Dr. Wish, another one Judy’s pick you bought and has gone nowhere is LYSCF. Did you get out of it yet? I stayed out of it at that time.
Dr. Wish, Can you plz share your Judy’s list on your blog so that we can watch/trade alongwith you and Judy..
Also would it be too much to ask, what is Judy’s method of picking such stocks.
Thx.
Sid.
Jason,
I looked back and see Dr.Wish mentioned LYSCF in Jan, but that was not my entry. Look back at the move in the stock since this fall. Even on this retrace up about 100%, better than TDSC %wise. Concept wise, go to home page and read about the facility coming online in second half 2011,this is one of my LT plays and a more speculative one . I myself will be holding thru the facility coming online (at least) unless the story changes
I guess if one is a pure investor as opposed to risk adverse trader then it was fine to hold TDSC into earnings and reap the rewards of the gap up and strong finish. But as a trader, mostly swing, I find it pure gambling to hold a position into earnings with risk management tossed out the window. Especially nonsensical if trade is showing a profit. Why not instead exit pre earnings and if price acts well post earnings then buy back, especially if a pullback offers another lower risk entry. Heck, often times price will dip with good earnings ala “sell the news” reaction, then set up for another entry at a lower price. Sometimes the buy back is higher than exit, sometimes lower, but it tends to even out over time.
Pete you are incorrect. For these growth stocks if earnings estimates are beaten the stock will zoom and if the earnings or quidance is bad the stock will fall. I would use options to limit the downside. Either buy OTM puts or sell OTM calls.
I am thoroughly interested in Judy’s method for uncovering such stocks. It’s clear that she doesn’t use a set of rules like Dr. Wish, so her style of investing is done more by feel acquired from many years of investing. I am curious to where she gets her news/information though.
BAR, thanks for the reply, but I still differ.The vast majority of retail traders/investors do not trade other instruments such as options, futures, etc. They have the always-on edge of being able to move fast in and out without making a market on their trades, thus the wisdom of quick exits and re-entries in front of and post earnings. There’s a lot to say about keeping things simple. To say though that good earnings will move a growth stock up is way too broad. All depends on where price is on the chart and most important what projected future earnings for the company are. Growth stocks can have their price cut sharply on a good report with sell the news reaction just as quickly as value stocks. A caveat I must add to my first post: Exceptions to rule always of course as someone riding TDSC or any stock into earnings with significant gains coupled with a full or oversized position may have a sound strategy by selling half or two thirds position. But again, for someone riding with a single digit gain or lower it would generally be best to sell all or most before earnings date imo.
From what I understand, it seems Judy does a great job picking stocks that will move up. But, the downfall to her strategy is that she may not be able to exit in a timely fashion if the stock goes south.
Apple is a great example. Apple is one of those stocks that everyone wants to have.Everyone’s mother owns the stock at this point. I had exited this stock two weeks ago as it started a run for 8 days and ran up to about 360 give or take a few points. Someone who new that this company would make revolutionary phones and music devises, and so forth would have invested in it at about 80 to 100 bucks. Nevertheless, now the stock has cracks in it and it seems it may have a very significant correction is taking lace. I am a strong believer in the saying that you buy a stock on fundamentals, but you must sell it on technical patterns otherwise you will get wiped out.
Everyone thinks they are buying on a dip and that the stock will rebound, but that is the common wisdom that will get you in trouble. Dr. Wish has his downfalls in his strategy, but he has the advantage of getting out of a stock that will fall hard and fast. By the same token, Judy has the ability to uncover great stocks but she might not be able to get out of a stock after it makes its run to a lcimax and then fall. With that said, fundamentals and innovation mixed with technical rules are the best strategy. The best thing is to find a balance between these two extremes.
Pete…Moving in and out of trades quickly increases trading costs. Also, I have no idea what you are talking about when you say it depends where on a chart the price is… at the end of the day guidance and earnings move the market not silly chart analysis.
BAR, moving in and out of trades quickly increases trading costs? Are you talking about excessive trading or smart trading? How about protecting profits? Most successful professional traders/investors sell when the chart tells them to sell, whether one day after entering a postion or one year or anything inbetween. What broker do you use? When has $6 to $10 in roundtrip commission fees become a back breaker in one’s account? If you don’t understand the concept of price on a chart in relation to whether or not it’s wise to take some or all off the table pre earnings then you probably need to start learning the basics of technical analysis. For example: If stock xyz has been in a steady unrelenting uptrend with significant gains from a base breakout several weeks prior and earnings is coming up, then odds are significantly increased for a selloff on the news regardless if positive or negative. Silly chart analysis? Please, you are showing outright ignorance with that comment.
Pete… “If stock xyz has been in a steady unrelenting uptrend with significant gains from a base breakout several weeks prior and earnings is coming up, then odds are significantly increased for a selloff on the news regardless if positive or negative. ” I love when people act like things are facts just because they want what they say to be correct. Your comment may be correct, however, I take advantage of the volatility of earnings season. By the way, please provide the data for evidence of your above quote. Showing outright ignorance… chart analysis is not the full picture… it is one of the many tools of the trader. Good lucky investing your pennies!