I have always observed that stocks tend to move like a school of fish,
that is together in a group. If you start to notice, for example, that
one steel stock is behaving well its fairly likely that the others
will be as well. It's also worth noting that there is always a bull
market someplace. For example in the middle of the bear market that
started in March of 2000 SYY broke out above $20 per share. While most
stocks were in the process of shedding 50% to 80% of their market
value's, SYY was up over 50%. Other names in its group showed gains of
between 20% to 200%, and again this was during an equity meltdown of a
severity not ever seen before. William Oneil, in his classic text "How
to make money in stocks" states that 37% of a stocks movement will be
tied directly to the performance of its industry group, while another
12% is due to the general sector. All of this should leave no doubt in
your mind as to how important being in the right groups at the right
time is.
With that in mind I have decided to start sharing some of my weekly
research on sectors and groups with you here on my blog and a few
message boards. This info will be basic in nature, but it will always
be free. I hope that it can provide something of a jumping off point
for your research and will be useful.
This week as I looked at the groups of stocks I found myself liking
Stem Cells, Real Estate Operations, General Industrial Machinery,
Medical Systems and Equipment, Hotels, Oil and Gas Machinery and
Gaming on the upside. On the downside Steel stocks stood out to me,
and Semiconductors will if they break down too much further.
In general the market remains in a tight trading range and I feel it
is likely to remain that way for a long time. That means that stock
and group selection will remain very important.
Brandon
that is together in a group. If you start to notice, for example, that
one steel stock is behaving well its fairly likely that the others
will be as well. It's also worth noting that there is always a bull
market someplace. For example in the middle of the bear market that
started in March of 2000 SYY broke out above $20 per share. While most
stocks were in the process of shedding 50% to 80% of their market
value's, SYY was up over 50%. Other names in its group showed gains of
between 20% to 200%, and again this was during an equity meltdown of a
severity not ever seen before. William Oneil, in his classic text "How
to make money in stocks" states that 37% of a stocks movement will be
tied directly to the performance of its industry group, while another
12% is due to the general sector. All of this should leave no doubt in
your mind as to how important being in the right groups at the right
time is.
With that in mind I have decided to start sharing some of my weekly
research on sectors and groups with you here on my blog and a few
message boards. This info will be basic in nature, but it will always
be free. I hope that it can provide something of a jumping off point
for your research and will be useful.
This week as I looked at the groups of stocks I found myself liking
Stem Cells, Real Estate Operations, General Industrial Machinery,
Medical Systems and Equipment, Hotels, Oil and Gas Machinery and
Gaming on the upside. On the downside Steel stocks stood out to me,
and Semiconductors will if they break down too much further.
In general the market remains in a tight trading range and I feel it
is likely to remain that way for a long time. That means that stock
and group selection will remain very important.
Brandon
