笑傲股市 How to make money in stocks 4th edition

Contents
Chapter OneAmerica's Greatest Stock-Picking Secrets

In this latest revised edition, you'll observe 100 charts of the greatest winners from 1880 to 2009. Study them carefully. You'll discover secret insights into how these companies set the stage for their spectacular price increases.

Don't worry if you're a new investor and don't understand these charts at first. After all, every successful investor was a beginner at some point—and this book will show you how to spot key buying opportunities on the charts, as well as critical signals that a stock should be sold. To succeed you need to learn sound, historically proven buy rules plus sell rules.

As you study these charts you'll see there are specific chart patterns that are repeated over and over again whether in 1900 or 2000. This will give you a huge advantage once you learn to, with practice, recognize these patterns that in effect tell you when a stock is under professional accumulation.

It is the unique combination of your finding stocks with big increases in sales, earnings and return on equity plus strong chart patterns revealing institutional buying that together will materially improve your stock selection and timing. The best professionals use charts.

You too can learn this valuable skill.

This book is all about how America grows and you can too. The American dream can be yours if you have the drive and desire and make up your mind to never give up on yourself or America.

Chapter TwoHow to Read Charts Like a Pro and Improve Your Selection and Timing

In the world of medicine, X-rays, MRIs, and brain scans are "pictures" that doctors study to help them diagnose what's going on in the human body. EKGs and ultrasound waves are recorded on paper or shown on TV-like monitors to illustrate what's happening to the human heart.

Similarly, maps are plotted and set to scale to help people understand exactly where they are and how to get to where they want to go. And seismic data are traced on charts to help geologists study which structures or patterns seem most likely to contain oil.

In almost every field, there are tools available to help people evaluate current conditions correctly and receive accurate information. The same is true in investing. Economic indicators are plotted on graphs to assist in their interpretation. A stock's price and volume history are recorded on charts to help investors determine whether the stock is strong, healthy, and under accumulation or whether it's weak and behaving abnormally.

Would you allow a doctor to open you up and perform heart surgery if he had not utilized the critical necessary tools? Of course not. That would be just plain irresponsible. However, many investors do exactly that when they buy and sell stocks without first consulting stock charts. Just as doctors would be irresponsible not to use X-rays, CAT scans, and EKGs on their patients, investors are just plain foolish if they don't learn to interpret the price and volume patterns found on stock charts. If nothing else, charts can tell you when a stock is not acting right and should be sold.

Individual investors can lose a lot of money if they don't know how to recognize when a stock tops and starts into a significant correction or if they have been depending on someone else who also doesn't know this.

As an individual investor, you too need to study and benefit from stock charts. It's not enough to buy a stock simply because it has good fundamental characteristics, like strong earnings and sales. In fact, no Investor's Business Daily® reader should ever buy a stock based solely on IBD's proprietary SmartSelect® Ratings. A stock's chart must always be checked to determine whether the stock is in a proper position to buy, or whether it is the stock of a sound, leading company but is too far extended in price above a solid basing area and thus should temporarily be avoided.

As the number of investors in the market has increased over recent years, simple price and volume charts have become more readily available. (Investor's Business Daily subscribers have free access to 10,000 daily and weekly charts on the Web at Investors.com.) Chart books and online chart services can help you follow hundreds and even thousands of stocks in a highly organized, time-saving way. Some are more advanced than others, offering both fundamental and technical data in addition to price and volume movement. Subscribe to one of the better chart services, and you'll have at your fingertips valuable information that is not easily available elsewhere.

The Most Common Chart Pattern: "Cup with Handle"

One of the most important price patterns looks like a cup with a handle when the outline of the cup is viewed from the side. Cup patterns can last from 7 weeks to as long as 65 weeks, but most of them last for three to six months. The usual correction from the absolute peak (the top of the cup) to the low point (the bottom of the cup) of this price pattern varies from around the 12% to 15% range to upwards of 33%. A strong price pattern of any type should always have a clear and definite price uptrend prior to the beginning of its base pattern. You should look for at least a 30% increase in price in the prior uptrend, together with improving relative strength and a very substantial increase in trading volume at some points in the prior uptrend.

In most, but not all, cases, the bottom part of the cup should be rounded and give the appearance of a "U" rather than a very narrow "V." This characteristic allows the stock time to proceed through a needed natural correction, with two or three final little weak spells around the lows of the cup. The "U" area is important because it scares out or wears out the remaining weak holders and takes other speculators' attention away from the stock. A more solid foundation of strong owners who are much less apt to sell during the next advance is thereby established. The accompanying chart from Daily Graphs Online® shows the daily price and volume movements for Apple Computer in February 2004.

It's normal for growth stocks to create cup patterns during intermediate declines in the general market and to correct 1½ to 2½ times the market averages. Your best choices are generally stocks with base patterns that deteriorate the least during an intermediate market decline. Whether you're in a bull market or a bear market, stock downturns that exceed 2½ times the market averages are usually too wide and loose and must be regarded with suspicion. Dozens of former high-tech leaders, such as JDS Uniphase, formed wide, loose, and deep cup patterns in the second and third quarters of 2000. These were almost all faulty, failure-prone patterns signaling that the stocks should have been avoided when they attempted to break out to new highs.

A few volatile leaders can plunge 40% or 50% in a bull market. Chart patterns correcting more than this during bull markets have a higher failure rate if they try to make new highs and resume their advance. The reason? A downswing of over 50% from a peak to a low means a stock must increase more than 100% from its low to get back to its high. Historical research shows stocks that make new price highs after such huge moves tend to fail 5% to 15% beyond their breakout prices. Stocks that come straight off the bottom into new highs off cups can be more risky because they had no pullbacks. Deep 50% to 75% cup-with-handle bases worked in 2009 since they were made by a 58% drop in the S&P 500.

Sea Containers was a glowing exception. It descended about 50% during an intermediate decline in the 1975 bull market. It then formed a perfectly shaped cup-with-handle price structure and proceeded to increase 554% in the next 101 weeks. This stock, with its 54% earnings growth rate and its latest quarterly results up 192%, was one of several classic cup-with-handle stocks that I presented to Fidelity Research & Management in Boston during a monthly meeting in early June 1975. Upon seeing such big numbers, one of the portfolio managers was instantly interested.

As you can see by this example, some patterns that have corrected 50% to 60% or more coming out of an intermediate bull market decline or a major bear market can succeed. (See the charts for Sea Containers and The Limited.) In most cases, the percent of decline is a function of the severity of the general market decline and the tremendous extent of the stock's prior price run-up.

Find Pivot Points and Watch "Volume Percent Change"

When a stock forms a proper cup-with-handle chart pattern and then charges through an upside buy point, which Jesse Livermore referred to as the "pivot point" or "line of least resistance," the day's volume should increase at least 40% to 50% above normal. During major breakouts, it's not uncommon for new market leaders to show volume spikes 200%, 500%, or 1,000% greater than the average daily volume. In almost all cases, it's professional institutional buying that causes the big, above-average volume increases in the better-priced, better-quality growth-oriented stocks at pivot breakouts. A full 95% of the general public is usually afraid to buy at such points because it's scary and it seems risky and rather absurd to buy stocks at their highest prices.

Your objective isn't to buy at the cheapest price or near the low, but to begin buying at exactly the right time, when your chances for success are greatest. This means that you have to learn to wait for a stock to move up and trade at your buy point before you make an initial commitment. If you work and cannot watch the market constantly, small quote devices or quotes available on cell phones and Web sites will help you stay on top of potential breakout points.

The winning individual investor waits to buy at these precise pivot points. This is where the real move generally starts and all the exciting action begins. If you try to buy before this point, you may be premature. In many cases the stock will never get to its breakout point, but rather will stall or actually decrease in price. You want a stock to prove its strength to you before you invest in it. Also, if you buy at more than 5% to 10% past the precise buy point, you are buying late and will more than likely get caught in the next price correction. Your automatic 8% loss-cutting rule (see Chapter 10, "When You Must Sell and Cut Every Loss ... Without Exception") will then force you to sell because the stock was extended in price and didn't have enough room to go through a perfectly normal sharp but minor correction. So don't get into the bad habit of chasing stocks up too high.

• 出版者 ‏ : ‎ McGraw Hill; 第4版 (8 六月 2009)
• 語言 ‏ : ‎ English
• Paperback ‏ : ‎ 464 頁
• ISBN-10 ‏ : ‎ 0071614133
• ISBN-13 ‏ : ‎ 978-0071614139
• 尺寸 ‏ : ‎ 14.22 x 2.29 x 22.61 cm