Bay Area Money Makers IBD Meetup November 7, Winning Stocks In A Model Portfolio. Lee Tanner. Non-Professional Amateur Volunteer

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2 Bay Area Money Makers IBD Meetup November 7, Winning Stocks In A Model Portfolio Lee Tanner Non-Professional Amateur Volunteer Co-Organizer Petaluma IBD Meetup 2

3 This Presentation Is: For Educational Purposes Only Not recommending any stocks/securities to buy or sell All Investing has Substantial Risk of Big Losses CAN SLIM Is The Registered Trademark Of Investors Business Daily (IBD ) 3

4 Everything here is from the Basic CAN SLIM Educational Material 4

5 Learn From The Experts 5

6 Learn From The Experts 5 IBD Live Workshops 8 IBD Home Study Programs 6

7 Educational Resource LEARN >> WEBINARS 7

8 Has 2015 Been A Good Year For CAN SLIM Investing? Who Thinks YES? Who Thinks NO? Who Thinks So - So? 8

9 Model Portfolio A Top Form of Post Analysis Very Powerful Learning Tool 9

10 Purpose Of Model Portfolio Lost of experience is a short time. Helps us better understand and appreciate the overall CAN SLIM investing system. Validates our methods and written rules. Improve confidence in using our methods and rules. Gives us a chance to adjust and improve these if needed. Demonstrates the advantage of using margin when we are experienced and ready. 10

11 The CAN SLIM Business 1 Study & Write Rules 2 Make a Watch List 3 Buy Just Right 6 Post Analysis Review 5 Sell Just Right 4 Manage a Portfolio 11

12 Rules & Guidelines For The Model Portfolio 12

13 Making The Watch List How Do We Find Winners? 13

14 The CAN SLIM Business 1 Study & Write Rules 2 Make a Watch List 3 Buy Just Right 6 Post Analysis Review 5 Sell Just Right 4 Manage a Portfolio 14

15 Finding The Best WL Stocks IBD 50 SL Recent big leaders in new bases. The Big Picture and Market Pulse The Market Wrap Video Stocks On The Move Screen Of The Day MarketSmith Custom Screens Stock Spotlight New America BC 20 YWR (IBD 85-85) LB Growth

16 Guidelines for Pick Stocks A Start Start Picking from the IBD 50, Sector Leaders, or custom MarketSmith screen. Annual Earnings Growth +25%, Quarterly Earnings Growth +25%, +50% if better, +75% is better,.. Quarterly Sales Growth +20% Accelerating Earnings and Sales Growth ( Very Attractive) Something NEW Do and Grade a Stock Checkup, Pick Grade B or better Full and Proper Base, describe the base. A/D Rating C or Better EPS Rating 95 RS Rating 95 RS Line headed up and making a new high. Composite Rating 95 U/D Volume Ration 0.9 ROE 17% PTM 18% ROE + PTM 30%, 40% or even 50% Read IBD articles, particularly New America. Visit the company website Concisely state the company business and what is new that is driving growth 16

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19 CAN SLIM IBD 50 Top 1%, or the 99 percentile Sector Leaders Top 1/10 th of 1% 19

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21 Guidelines for Pick Stocks A Start Start Picking from the IBD 50, Sector Leaders, or custom MarketSmith screen. Annual Earnings Growth +25%, Quarterly Earnings Growth +25%, +50% if better, +75% is better,.. Quarterly Sales Growth +20% Accelerating Earnings and Sales Growth ( Very Attractive) Something NEW Do and Grade a Stock Checkup, Pick Grade B or better Full and Proper Base, describe the base. A/D Rating C or Better EPS Rating 95 RS Rating 95 RS Line headed up and making a new high. Composite Rating 95 U/D Volume Ration 0.9 ROE 17% PTM 18% ROE + PTM 30%, 40% or even 50% Read IBD articles, particularly New America. Visit the company website Concisely state the company business and what is new that is driving growth 21

22 CAN SLI M My Watch List 22

23 We Are Picking Stocks That: The big institutions have begun buying. And that they will continue to accumulate. These stocks have: Demonstrated recent high earnings growth. A recent 30% price advance. Evidence of accumulation. Evident long term earnings growth potential. CAN SLIM 23

24 Any Questions? 24

25 What About The Market? What Is It Usually? Bullish! 25

26 The Market Is Bullish > ¾ Of The Time Monthly 30 Years 26

27 My Stock Buying Rules Buy top rated CAN SLIM stocks when they are breaking out of bases: In confirmed uptrend per the MARKET PULSE Under Pressure Confirmed Up Trend Under Pressure In correction, when in a bull market and I think it will soon be in a confirmed up trend. Make follow-on buys whenever they occur provided: The buy point is 6% above the last buy point. Not within 5% of the price target. 27

28 Daily 10/3/

29 Daily 10/7/

30 Daily 10/16/

31 Daily 11/12/2014 Bull Market 31

32 The Market Is Bullish > ¾ Of The Time Monthly 30 Years 32

33 Weekly 5/1/

34 My Stock Buying Rules Buy top rated CAN SLIM stocks when they are breaking out of bases: In confirmed uptrend the MARKET PULSE Under Pressure Confirmed Up Trend Under Pressure In correction, when in a bull market and I think it will soon be in a confirmed up trend. Make follow-on buys whenever they occur provided: The buy point is 6% above the last buy point. Not within 5% of the price target. 34

35 If I m invested assuming this But this happens Sell Rules Limit My Losses They Are Small < 7% 35

36 But this happens My Losses Are Big But unaccounted! If I m NOT invested assuming this So I can fool myself into blaming the market or the system 36

37 I prefer to be invested and wish I weren t, than not invested and wish I were. 37

38 If invested and wish I weren t 38

39 I hate missing this! This Is A 150% Loss 39

40 Weekly 1/2/2015 In a BULL MARKET if stock on my WL are breaking out I buy them. 40

41 Once I Own A Stock I Sell It Only: When A Sell Rule Is Triggered Sell Rules Are Essentially All Stock Specific One Relates To Portfolio Draw-Down None Reference Market Direction 41

42 You Ever Have The Case Where The Market Goes Up But Your Stocks Don t? The Other Happens Too! 42

43 With The Market I m Generally Optimistic The Same Applies To Picking Stocks 43

44 Guidelines for Pick Stocks A Start Start Picking from the IBD 50, Sector Leaders, or custom MarketSmith screen. Annual Earnings Growth +25%, Quarterly Earnings Growth +25%, +50% if better, +75% is better,.. Quarterly Sales Growth +20% Accelerating Earnings and Sales Growth ( Very Attractive) Something NEW Do and Grade a Stock Checkup, Pick Grade B or better Full and Proper Base, describe the base. A/D Rating C or Better EPS Rating 95 RS Rating 95 RS Line headed up and making a new high. Composite Rating 95 U/D Volume Ration 0.9 ROE 17% PTM 18% ROE + PTM 30%, 40% or even 50% Read IBD articles, particularly New America. Visit the company website Concisely state the company business and what is new that is driving growth 44

45 Missing this is a big loss! 156% 45

46 I Don t Want To Be So Picky That I Never Pick 46

47 Any Questions? 47

48 CAN SLIM Can t Work Because Everybody Knows It Who Worries This? 48

49 Widely Known Not A Problem! 1. 2 million people know CAN SLIM, but only two follow the rules. 2. Even the two who do follow the rules, Charles Harris and Mike Webster, don t do so exactly the same. 3. CAN SLIM as practiced by the individual investor is not suitable for big money institutions or hedge funds. 4. Doing it properly is too much effort for most people. 49

50 Model Portfolio Methods Accurately make watch lists just as we would in reality. Buy stocks realistically as we would in reality, using intra-day data and precise times. Manage capital deployment as we should in reality. Make follow-on buys per our rules, using intra-day data for detailed accuracy. Sell stocks per our written rules, using inter-day data and exact times. Carefully record all portfolio details for review and validation This Model Is Very Realistic, Accurate and Thoroughly Documented 50

51 2015 Model Portfolio 51

52 Fairy God Mother $100,000 On 1/1/2015 Build a good CAN SLIM portfolio if you can. 52

53 All Good Portfolios Start With? A Good Watch List 53

54 The CAN SLIM Business 1 Study & Write Rules 2 Make a Watch List 3 Buy Just Right 6 Post Analysis Review 5 Sell Just Right 4 Manage a Portfolio 54

55 The First Watch List Frist Week January