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Hi Charles,
The 5% is my subjective attempt to quantify what he said - the "at least
double their 52 week low" however, was spelled out pretty clearly in his
Wall Street the Other Las Vegas book.
He says, "With pen in hand, I zoomed rapidly down the page, mentally
comparing the highs and lows. When I saw a high for the year that was
at least double the corresponding low figure (in other words, a 100
percent advance), I automatically glanced across the page to the stock's
high for the week. If it was at or within a few points of the high for
the year, I made a check mark at the outside of the column, and
continued to read through the listings in the same manner...the
remaining stocks were chaff and could safely be ignored."
Then he explains how he further culled those stocks by only selecting
those that were at their all-time highs.
The stocks he bought also tested the tops of their boxes (bounced
against the top of their box) for 3 consecutive days before he placed a
buy order in just above the top of the box. He simultaneously placed a
sell order from what I can understand, underneath this new box (the top
of the old box being the bottom of the new box). He called this his
circuit breaker in case the stock didn't perform as expected and
reversed. You probably got that from reading the $2MM book.
Good Trading,
Ruth
charles meyer wrote:
>
> Ruth:
>
> It has been some time since I studied Darvis' work.
> Judging from your post, I overlooked some gems
> that you seemed to have quantified. Did you study
> all the examples to discover that he picked stocks
> that were within 5% of their 52 WK highs?--AND
> were at least twice the 52 week low?
>
> My understanding is that the stocks he bought
> were near historic highs. That is to say, a stock
> can be near a 52 WK high but not near a historic
> high. Perhaps the 52 WK high can be used as
> a proxy when the markets are not at historic
> high levels? Alternatively, perhaps there are
> always stocks near historic highs?
>
> I have pages 179-198 from one of his books that I
> xeroxed and will be happy to fax you. It is titled
> "Questions and Answers". But, as said, I can't
> remember if it is from the $2mil book or Wall
> Street: The Other Las Vegas, or the third book;
> ...You Can Still...etc.
>
> Charles.
>
> PS. The boxes can be easily quantified.
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