A bulk of a stock’s move is due to the underlying sector/industry; a rising tide can lift all boats. Keeping track of the best performing sectors/industries and the stocks within the sectors/industries is a great way to narrow down the stock universe to the strongest stocks in the currently favored industries.
Knowing the top 20 sectors is a starting point, what you want to do next is narrow down stocks within the sectors to a manageable list. You can narrow down the list in many different ways; market cap, price per share, earnings/revenue growth, etc. I like to narrow down the list by creating a scan that shows me the stocks that are not extended based on how far they are away from their respective 20-day moving average. This particular scan will only show me the stocks that are within 3% of their 20-day moving average.
We live in a world in which we are bombarded with information, tweets, blogs, etc., content is the new salesman, content is the new marketing, content is the new networking. With information being so readily available, bloggers try to differentiate themselves with their writing skills, volume, and consistency, putting out blog posts to meet quotas. We are seeking to stand out from the crowd by showing performance, by taking all the information and seeking alpha, that’s the sole purpose of the blog. It won’t always be pretty; it’s never easy, and performance is spotty, but we seek superior risk-adjusted returns, not notoriety for our writing skills. If this is something you can relate to, then this blog is for you.