Saturday, April 24, 2010

Weekly Market Report W/E 4/23

At the end of each week in Financial Tides, I like to clear my head of all the articles and newscasts that have clouded my vision during the week and look at just the facts. I use the data on Barchart to give me the 3 yard sticks to measure the market performance. Then I plan my strategy for the coming week.

Value Line Index -- Contains 1700 stocks so it is broader than the S&P 500 or much narrower Dow 30 -- Still climbing
  • Index up this week by 3.55% -- up for 3 months in a row
  • Index closed Friday above its 20, 50 and 100 day moving average
  • Hit new highs in 12 of the last 20 trading sessions and was 5 for 5 last week
  • 7.21% price appreciation for this month
  • 100% Barchart technical buy -- 13 of 13 technical buy signals

Barchart Market Momentum -- Percentage of stocks closing above their daily moving averages for various time frames -- Above 50% is always better

  • 20 DMA -- 77.90% closed above -- 68.30% last week -- 64.93% last month
  • 50 DMA -- 85.01% closed above -- 83.15% last week -- 78.65% last month
  • 100 DMA -- 86.21% closed above -- 83.86% last week -- 78.42% last month

Ratio of stocks hitting new highs to new lows for various time frames -- 1.0+ = bullish, 1.0 = neutral, below .99 = bearish -- Very bullish

  • 20 day new high/new low ratio -- 2350/413 = 5.69
  • 65 day new high/new low ratio -- 1860/140 = 13.29
  • 100 day new high/new low ratio -- 1664/106 = 15.70

Investment Strategy -- Since all 3 yard sticks are positive I'll continue to stay in the market. I'll cull stocks that don't close above their 50 DMA and replace them.

Wall Street Survivor results -- The columnists who contribute to Top Stocks have a little friendly competition going over on Wall Street Survivor . I'm climbing out of the hole I was in and month to day I'm in first place with a 9.3% return just ahead of John Reese with a 5.15% return and we're both ahead of the S&P turning in a 4.09% return. We still have a full week to go this month so anything can happen.

Jim Van Meerten is an investor who writes on financial matters here and on Financial Tides. Please leave a comment below or email

Disclosure: I do own positions in stocks mentioned in my blogs

Friday, April 23, 2010

Top blog post

About 5 years ago after 35 years of investing in stocks, mutual funds, closed end funds and ETFs rated top picks by others I decided I could do a better job myself. I was reading Forbes magazines Best of the Web and decided to take their recommendations. In that issue they recommended Marketocracy as one of the top stock market simulation games and Barchart as one of the easiest stock screeners to use.

Soon my funds were getting green stars from Marketocracy meaning that they were beating at least 75% of the other 100,000 plus portfolios rated by Marketocracy. I begin asking questions in the forums and found the M100 guys -- Those top 100 out of 100,000+ to be very honest and giving of their time. A few even encouraged me to enter a contest sponsored by Marketocracy, MSN Money Central and Investor Place Media called the Strategy Lab Open. The winner of the contest would get a chance to be in a Strategy Lab contest against some real professionals on MSN Money Central. I'm not sure how but I won that contest and began writing articles for Top Stocks.

I have since retired and now write on-line columns on Barchart, MSN Top Stocks, Seeking Alpha, Main Street Investors and my own blog Financial Tides teaching others how to pick and manage their own investments.

This month Marketocracy gave top recognition honors to 3 of my simulated Marketocracy portfolios. They named my Barchart -- Jim Van Meerten Speculative Fund -- (VMSPC) to their M100 . Per their press release: "M100 members have proven long term track records, and serve as the ambassadors of our top performing members. We have thousands of excellent investors who are beating the market, but only 100 make this list at any given time. These members receive many benefits for their participation in the m100, including free premium memberships, posting privileges on our forums, press opportunities, and cash. Marketocracy pays all m100 members based on the assets under management with our affiliate, Marketocracy Capital Management. "

They also compared simulated funds that had been in existence over 5 years against the top 50 mutual funds with 5 year track records. My Barchart -- Jim Van Meerten New High Fund (VMNHI) beat the #10 rated mutual fund, the Alger Speca A (SPECX) rated by Morningstar as a 5 star 5 year pick . My fund was created in March of 2005 and has returned 76.36% since inception beating the S&P 500 return of 10.03% by 66.34%. Annualized results were 11.68% for (VMNHI) vs. 1.88% for the S&P 500 so I beat the benchmark by 9.81%. They also compared my VanMeerten S&P 600 Fund (VMSIX) and found that my return beat the #27 top rated 5 year return of Fidelity's Select Software (FSCSX) and rated by Morningstar as a 5 star 5 year pick, My fund was created in November of 2004 and has returned 71.11% beating the 13.76% return of the S&P500 by 57.35%. The annualized rated of return of 10.44% beat the S&P 500 return of 2.41% by 8.03%.

What have I learned and how can you profit from my experience? When I was being interviewed as a finalist for the Strategy Lab Open Ken Kam made an observation. He said, " You trade a lot of stocks but seem to sell losers right away". I've found that is the key to investing. Learn how to cut your losses and let your profits run. Sounds simple but discipline wins over brains.

In the VMNHI fund:
Best Winners -- Chico's (CHS) 266.42%+ and Panti Computers (PTI) 249.20%+
Worst Losers -- Premcor (PCO) -100.00%- and Epic Energy (EPCC) -57.60%

In the VMSPC fund:
Best Winners -- Aixtron Akteingesellschaft (AIXG) 244.74%+ and Rural/Metro (RURL) 187.56%+
Worst Losers -- Elan Pharma (ELN) 69.26%- and Dollar Thrift Auto (DTG) 68.43% -

Anyone can pick stocks that beat the market. The key is knowing when to get out and preserve your profits. I formerly used a stop loss of 10% but found that too tight. I now use the 50 day moving average and seem comfortable with that. Please share your thoughts on stop losses in the comments section.

I'd like to thank Marketocracy for the recognitions and Barchart for the excellent stock screens.Please join me on my quest to beat the market by reading my blogs on Barchart, Top Stocks, Seeking Alpha, Mainstreet Investors and of course my own blog Financial Tides.

Thursday, April 22, 2010

Marketocracy Portfolio changes

I've got some changes to some of my Marketocracy portfolios:

VMFOR - this is a portfolio that restricts it's universe to stock in the S&P 400
Deleted -- NTY - NTYB inc. Failure to maintain a price above its 50 DMA

CMG - Chipolte Mexican Grill - Barchart buy signals and posigtive price appreciation
PPDI - Pharma Product Dev - 96% Barchart buy signal plus positive prioce appreciation
HNI - Hni Corp -- 86% Barchart buy signal + posiitve price appreciation
BOH - Bank Of Hiawiaa = 88% Barchart buy signal + positve price appreciation

VMFIV -- this portfolio resticts itself to stock in the S&P 500

MAR - Marriot -- Barchart buy signal plus positive preice appreciation
SHW - Sherwin Willians - purely techi=nical buy signals from Barchart and positve price appreciation

VMSHT -- Before you jump to conclusion the "SHT" means "short", but I guess that's what a short fund is:

BIIB - Biogen Indec -- BArchar sell signals plus very negative price action

Monday, April 19, 2010

My government scares me!

The Financial Tide has become the Red Tide. There was a line in the Pogo comic strip: " We have met the enemy....and he is us!" What scares me the most is that all this deficit spending that is going on at the local, state and federal level all has to come from the same pocket book -- mine! I was watching one of the Tea Bagger rallies on TV and a woman had a poster with the picture of a baby and the caption:" I'm only 6 hours old and I'm already $46,000 into debt"

Back in the first quarter of 2007 when the stock market was down and looking like it was going to continue downward for a while, I personally started cutting back. I moth-balled my credit cards and begin to use only my debit cards. If I didn't have the money, I didn't buy it. My government seems to have never gotten the word.

All I hear is how they are considering trimming next years budget. How about this years budget? I've asked my friends that work for "the Man" if they have been asked to cut back. They all say no. They have been told if it's budgeted go ahead and spend it.

Here in Charlotte we are talking about laying off teachers, police, firemen and EMTs but we are still going ahead with highway beautification projects, side walks and even a trolley to a mall that is in foreclosure because they were already budgeted. People are being let out of jail to keep costs at the courthouse down.

Hey you guys in government! Many are unemployed or under employed so income tax revenues are down. Retail spending is down so sales tax revenues are down. Property values are down, people are filing for downward reassessments and foreclosures up so property tax revenues will be down.

When will my government at all levels stop spending like a drunken sailor? Does anyone have the number of the local Tea Bagger chapter?

I'm not sure what I as an individual can do, but I've got to do something. That's my money they are spending. Wait a minute -- They are writing IOUs and signing your name and mine. Did you give permission for someone to sign IOUs for you, I know I didn't.

Can anyone in government give me a definition of "fiscal responsibility". Let's hear your ideas.

Jim Van Meerten is an investor who writes here and on Financial Tides. Please leave a comment below or email