Find Growth Stock Winners

Transcription

1 Find Growth Stock Winners Michael (Huaiyou) Li Blog: Image courtesy:

2 Topics Beat the smart money Where to find growth stock winners? How to read stock charts get on, ride it and get off Stock Market Game program Put everything together Appendix Useful links For education purpose, not investment advice 2

3 Beat the Smart Money Smart Money the elephant 1. Financial institution, mutual fund, pension/retirement, hedge fund etc 2. Slow to build and exit positions We, individual investors, have huge advantages 1. Your flexibility Entering and exiting quickly 2. Long/Short or hold cash in volatile condition For education purpose, not investment advice 3

4 Where to find growth stock winners? 1. Eat Well run fast food chain (Domino s pizza, McDonalds, Chipotle etc) 2. Wear, housing Sportswear (Nike, UnderArmour); Home Depot etc 3. How you talk to friends/new media Facebook (Instagram, Whatsup etc), Search, hangout (Google), Video streaming (Netflix, YouTube etc) 4. Leisure Travel booking (Priceline), video games (Electronic arts) 5. Upcoming new business/lifestyle Uber, AirBnB, SnapChat etc (These are not public yet) For education purpose, not investment advice 4

5 Some winning examples For education purpose, not investment advice 5

6 Domino s pizza: 3000% return 10 years For education purpose, not investment advice 6

7 Home Depot: multi-baggers For education purpose, not investment advice 7

8 FaceBook: 600% in 4 years For education purpose, not investment advice 8

9 Common themes of big winners? 1. Business model easy to understand try use one sentence to describe the company 2. Profitable and strong fundamental, explosive earnings and sales growth to research 3. Customers love the product and service 4. Look expensive, and many times price stay near all time high 5. No quick get rich scheme, all hard work and patience For education purpose, not investment advice 9

10 How to read stock charts get on, ride it and get off For education purpose, not investment advice 10

11 Stock Charting 1. or tradingview.com 2. Keep it simple, just look at price and volume 3. Moving averages (20day, 50day, 200day) 4. Can you see uptrend or downtrend? For education purpose, not investment advice 11

12 Stan Weinstein stock stage analysis Ride Stage 2, avoid stage 1, 4 Courtesy: For education purpose, not investment advice 12

13 CMG Chipotle running into issues For education purpose, not investment advice 13

14 CMG Weekly Chart For education purpose, not investment advice 14

15 CMG Daily Chart For education purpose, not investment advice 15

16 1. Have an exit strategy Get off the ride 2. Some trends last longer, others shorter; sooner or later they all end 3. You don t have a gain unless you sell it For education purpose, not investment advice 16

17 GoPro Weekly Chart For education purpose, not investment advice 17

18 Review Stock Market Game Program Official website Stock Market Game online tutorial Capital Allocation $100,000, 20,000 each name Teamwork 3-5 member, everybody should participate; Or get your parent involved For education purpose, not investment advice 18

19 Put Everything Together Discipline: Ask these before each buy 1. General Market: Friendly or Hostile? Use stockcharts.com (Input SPY, QQQ, IWM, DIA) or a quick look at 2. Stock pick: Does your name fit winner theme (slide 9)? 3. Is your stock in stage 2 (slide 12)? 4. Exit plan: a. Sell at a small loss - admit you bought at a wrong price/timing b. Sell when it reaches your price target Discipline: Only 3 results for each buy 1. Sell at a small loss: max 3-5% loss of your name (so $600-$1000 of your $20000) 2. Small gain: market condition changes, become hostile, exit first 3. Position held let it run for bigger gain For education purpose, not investment advice 19

20 Appendix Useful links Stock Market Game Official website Stock Market Game online tutorial DN_HuB0 Stock charting or tradingview.com Stock research, Market news For education purpose, not investment advice 20