Are we at the beginning of a new bull market? No. Is the economy beginning to expand or contract? Contract. Can you make profitable trades during the November-April time-frame? Well of course!
In the poker game, Texas hold 'em, a each player only starts with two cards and the remaining cards are shared. This is a lot like placing your bets on a stock trade. Texas hold 'em involves playing relatively few hands, as does trading which involves playing relatively few stocks. The key is to have someone bet that your stock is going higher after you're in it, and have them raise their bids along the way.
The key of course is not to get greedy, and as Kenny Roger's said," know when to hold'em, and know when to close'em". I really don't care if the stocks go higher. In trading, you're in and out for the buck.
If you follow our stock/fund/ETF picks on Tipstraders.com, you'll see that we sold our three trading stocks (AAPL, RIMM, GOOG) yesterday. My opinion remains that we are not in a buy and hold market. I have very little interest in holding momentum stocks that are in the late stages of their advance.
While most investors hope to gain 10% in their portfolios over a 12 month time horizon, we were able to achieve those gains, and more, in just 12 trading days. Here are the results of our three trades. All trade calculations were compiled by Tipstraders.com.
AAPL: 12 day trade.
Paid $164.30 on 11-16-07
Sold $180.22 on 11-28-07= +15.92 points
Gain +9.69%/ 1,466% annualized
GOOG: 12 day trade.
Paid $629.65 on 11-16-07
Sold $692.65 on 11-28-07= +63 points
Gain +9.94%/ 1,577% annualized
RIMM: 12 day trade
Paid $103.01 on 11-16-07
Sold $121.35 on 11-28-07= +18.34 points
Gain +17.80%/ 12,983% annualized
According to the Stock Traders Almanac, " Since the Great Depression, the incumbent administration has presided over upbeat stock markets as the third year of their
term drew to a close. Pre-election year economic pump priming in combination with the “Best Six Months” has proved to be a powerful amalgamation."
Now I have to warn you in recent years the stock market has ignored many seasonal tendencies such as "sell in May and go away", as well the September-October swoon.
Last night, I painfully watched the Republican "YouTube" debates. I also watched the last Democratic debate. I find it interesting that the American people pick their President only after the media has narrowed down the choices for them. You know the drill, whoever they focus on the most (get the most media attention) ends up being the top candidate.
Here is a YouTube video of Dick Cheney answering a question from David Rockefeller at a CFR meeting. Tell me, who is sucking up to who?
After watching this video, you now know why many of our politicians back globalism, NAFTA, CAFTA, open borders, etc. Why is this important? If you invest in the stock market, you have got to understand where to place your bets and why.
Sadly, the top candidates, like your Congressmen and Senators, are already bought and paid for. For example, the David Rockefeller run Council of Foreign Relations is narrowing their choices, and I'm sure we will have to pick from whom they give their blessing.
The average America has little or no net worth. There is a reason for this. The focus of US politicians is to tax interest earned on bank savings, as well as capital gains on mutual funds. This encourges consumption, and discourages savings and investment. As a result, consumer debt has grown about twice as fast as personal income. This is great for corporations who have been the backers of globalism, NAFTA, CAFTA, and open borders, but bad for consumers who are laden with debt.
Think about it. The average American would need to save $1 million dollars, just to draw $40,000-$50,000 in retirement income. Now, I know a lot of people who have a million or more, but I only deal with people who have money.
When you go shopping at Wal-Mart, Target, or a Mall, look as the massive numbers of people, and then ask yourself, how many of those have a million dollars saved. I think you’ll find the number is very low.
