Greetings, fellow Pro-fundity team members -
1-26-01 Page

This Week's Guidepost

Pick Performance - Why should I pay for the Pro-fundity product?

Last week we discussed the Breakout picks made last December 15th. We discussed how difficult it is to analyze performance based on simply today’s price compared to the price on the date of the pick. A lot of things can and do go on in-between when we’re dealing with volatile rollers. That is why we look at the price action on individual tickers. We’ve learned there are messages in the price and volume activity. These messages may whisper “...a little change here, a little caution there,” or may shout “...get out now!” We featured the Breakout pick CANI and why we made the pick, what the messages told us and how we responded. These are essential to successful trading in the market. Let’s look at an overall picture of pick performance for the Pro-fundity Page and see how the picks stack up.

1. The table below details page-picks for the last 17 weeks, including data for the 10 Picks, 5 Quick-Picks and 5 Breakouts on 1/26/01. Each row in the table lists the date, the number of days since the page, and percentage performance comparing the closing price on this Friday (1/26/01) and the Friday of the pick. This includes the Winners and Losers and the average percent yield (both raw % and its annualized APR) for each group. A winner is a ticker whose price is higher on "today" than is was when the pick was made, with no consideration to what went on in between. This is the standard "buy and hold" method of analysis.

   

2. This is a noisy table with too many numbers, but here’s what it tells us. From the total 340 picks (spread across 17 weeks, 20 per week), we had 220 winners, or 65.1%. That doesan't sound so good. The next figure shows the performance as time progressed in the market. The best returns came around the fifth week, then getting smaller with more market time.

   

   The next two graphs show the result for Quick Picks and Breakouts.

   

   

3. These graphs help us see why “buy and hold” analysis is missing something. In all three cases the performance goes down with more time in the market. Here's why; Look at this shot of a pick made on 11/10/00:

   

4. The price on the day of the pick was $27.81 and it closed last Friday at $28.31. That’s a 1.8% increase, a Winner! But look at what happened in-between. Two good rolls that potentially could return over 29% if we were perfect at picking the top & bottom of each roll. If we got only half that, our return would be 1.8% plus 14.5% or 16.3%. Our table above misses that opportunity. The next picture shows another problem.

   

5. KRC closed on the pick date at $26.06 compared to last Friday’s close of $26.13. Another dramatic increase of less than 1% in the table figures. Is there anyone out there who couldn’t capture at least 6% of this 12% rise?

6. The purpose of this dialog is to demonstrate the power in the Picks, Quick-Picks and Breakouts offered each week on the Pro-fundity Page. This is a well researched set of tickers that are volatile candidates for rollers or breakouts. Because we demand intense fundamentals criteria for our Picks and Breakouts, many just keep rising with time. We will discuss these fundamentals in next week’s Guidepost. This data base of tickers is the reason why you should pay for the Pro-fundity product. With a success-rate far above the 65% for reasons covered, you won’t find a better market sand-box to play in. This gives you the raw material to try your own strategies for dramatic success. Stay tuned.

It is our intent to help our subscribers understand market strategies well enough to make informed decisions and understand the risks.

TC-2000 tutorials are available on the home page.