How to Find Money Making Stocks in 45 Minutes

This system is for everyone whether you are a fundamentalist or a technician. For the fundamentalists, the selection of stocks is based on strong company fundamentals looking for stocks with high five year EPS and the best 12 month price appreciation. For the technician, the system chooses those stocks which are now breaking out into new highs with rising Relative Strength.

What does this system cost you ask? How about $2

Let's list the Five goals of investing:

1)
Don't Lose Money
2)
Make Your Money Grow Faster Than Inflation And Taxes
3)
Choose Less Risk/More Reward
4)
Use A Mechanical System (Eliminates Emotional Up & Downs)
5)
Did We Mention Don't Lose Money?

These basic rules of investing are very simple and basic. You now need to prepare yourself for inevitable losses.

If you've spent any time trading stocks, you know there are times when you lose. You need to plan ahead of time to lose as little as possible. The good news is you are gong to win. You need to plan ahead of time to win a lot more than you lose. Pick your own proportion...I like a loss of no more than 5 - 10% of any individual investment. I like to win at least 50% Increase of my investment. Go for the goal of 5:1...Gain $5 for every $1 loss.

Here's What You're Looking For...The System

Our basic tool is the Monday edition of "Investors Business Daily", $2 on newsstands everywhere. We'll also need pencil and paper. If you wish, "Investors Business Daily" is accessible on line, but since we only need Monday's edition, don't pay for a full yearly subscription either newspaper or electronic.

Steps for success...

1)
Buy the Monday edition of "Investors Business Daily" IBD (available on Saturday morning in my area)
2)
Pick any market NYSE, AMEX, NASDAQ
3)
Look for the column "52-wk High" and find the symbol NH (New High)
4)
Check the "Earnings per Share" EPS column. Your NH stock from step 3 must be 80 or greater
5)
Check the "Relative Price Strength" RPS column. Your NH stock must also be 70 or higher here
6)
Volume should be greater than 80,000 shares
7)
Using an online source or "Standard and Poors Stock Guide", check to make sure that the New High is the highest historical price ever.
8)
Check the Accumulation/Distribution column. Your stock needs a rating of "A"

The stocks which remain after this screening are the ones you trade with this system. How many stocks you'll find will depend on how well the market did that week. You should strive to have from 8 - 12 stocks in your portfolio. Don't buy all of them the first week. Space your purchases out over a time frame that makes sense for you.

You have your stocks and things are humming along. The last and most important step is ... How do I know when to sell?

Any time the Relative Strength drops below 70 (on a weekly basis) get out !!!! What has happened is the stock is not keeping up with the market. The price growth has flattened or heaven forbid, even dropped behind the other stocks in its comparison group. If your stock is doing what it's suppose to do, you will see its RS continue to go up. Once again, a falling RS is a sign of weakness...Sell the stock !!

When to take profits? That's another important question. Here are several suggestions. You should modify them to suit your style of investing.

•
Wait for a drop from the highest RS level and use that as a sell target. As an example, let's use 5 points from the peak and then sell. Say the stock has an RS high of 94. When the RS drops to 89...get out.

•
The tried and true "Trailing Stop" method to preserve your profits when your stock starts to drop. Conventional wisdom is an 8 - 10% trailing stop.

•
Take your money invested out and let your profits run. After the stock raises 20-30%, sell either half or whatever you want and let your profits run.

•
Take you profits at 25% and move on to the next trade.

There you have it. The system is not complicated and if done correctly is very mechanical. Enjoy your profits and go to Tahiti