Best and Worst performed Stocks

11/30/2006

Best: Durect Corp. (DRRX) +23.16%








Reason: (8-K) issued a press release announcing positive results from a Phase I clinical trial evaluating an abuse-resistant opioid pain drug candidate based on DURECT's patented ORADUR™ technology. A copy of DURECT's press release is attached as Exhibit 99.1

MA200 should be flat with support of 3. Last two days volume and candle stick shapes. Especally previous day have high volume with candle stick hammer feature.

Total cash: 83.56M
Total Debt: 58.27M
Held by insiders: 17.12%
Held by institutions: 56.40%
Cash flow: -7.21M

Downward moving potential dries up. Safety margin should be high at close prices of previous 5 days: 3.80, 3.77, 3.78, 4.02, 3.99. Upward moving potential is not known. But since it is a pham firm, it should be a big move when it happens. The 5 days time frame should give chance to build position. However, the difficulty lies how to detect this gem. stockcharts.com has excellent scanners. But which one can be most useful?

Worst Stock: Select Comfort Corporation (SCSS) -17.68%

Reason - Outlook for next quarter sales is not good. "The Minneapolis-based bed retailer said same-store sales during the first eight weeks of the fourth quarter ending with the Thanksgiving weekend fell 9% from last year. Total sales in the period rose 6%, while total unit volume increased 8%. The company cut its full-year earnings outlook to a range of 80 cents to 87 cents a share and said it now expects fourth-quarter same-store sales growth to be below the low end of its long-term growth targets. "

MA200 looks top at around 25 and starting a downward development. Without decent recovery and valume after hugh drop happened most recently.

Foundamental is so good.

This stock will bounce back ....

Best investment strategy

Excerps from a Montley Fool article - About Hidden Gem

http://caps.fool.com/Index.aspx

the world's greatest investor would buy a special kind of common stocks that some of the world's top investing minds can't stop raving about. Here are just a few reasons why...

• When Ibbotson Associates analyzed 70 years worth of data — it discovered that these stocks outperformed every other type
• Another study by Oppenheimer Capital reveals that this particular class of stocks has outperformed the S&P 500 by a wide margin since 1925
• The highly respected CPA Journal confirms that "the lack of coverage by Wall Street produces a highly inefficient market in these stocks that breeds opportunity"

Comments - The reason why invest in SMALL SIZE. Other reasons:

• In fact, a big player like Buffett has massive amounts of capital to put to work. It's simply not practical for him to take positions in small-cap stocks — no matter how undervalued or how much he loves the business.

• The same goes for most professional money managers and mutual funds. With hundreds of millions or even billions to invest, most institutions can't buy high quality smaller stocks without 1) running up the price and 2) buying up a controlling share of the business.

Return of Small but Undervalued stock:















lookout for undervalued companies that offer...

• Pristine balance sheets with low debt
• Solid, cash-generating businesses in profitable niche markets
• Outstanding management with large ownership stakes

One limitation - Have to be less than 1 million investment fund. Otherwise, it will drive up price and buying controlling shares.

Daily and Weekly tasks

Daily:
1 Follow the the best daily performed stock and analyze the behind reason
2 Follow the worst daily performed stock and analyze the behind reason

Weekly:
General economic and market analysis

First day of trade

Had hard time last night finding the stocks. Stick to computer until 1:00Am at night. Just could not not get the stocks to fully invest the $5000 artificial fund.

Lying on the bed, just could not fall in sleep. Just are not comfortable with the whole process. Further thought of the strategy:

Is that a must-do to fully invest the $5000, even cound not find the best stocks to fit the criteria set up?

What about the critiria of "First, not losing money. Second, don't forget the first rule."?

Since the investment policy set up last night has a rule of liquidate a position when the price falls 7% below the entry point, pacified self a little.

Now I am decided to keep the rule of fully invest $5000 no matter it's of bull or bear. Reasoning: There is always good opportunity in the market. By fully investing, it will force self to do the research.

Talking about search for great stocks, it's really not easy due to the following reasons:

1 So many stocks out there, meaning a lot of choices. It's hard to convince self which one is the best. Too many choices could just confuse minds.

2 Too many concerns when choosing a stock, Technical (50, 200 MA, MACD, RSI), foundamental (has positive income, low P/E; if not profitable, does it have potential? Althought P/E is high, does it justify it has a great growth rate? Not buying a stock if it has already run up 20% in the last 3 month, what about some stocks keep on moving up and up?) Making decision which satisfy all of the critira is not easy. Actually very very hart.

3 Is the goal of making 50% gain realistic? Is the 20 tradings a guarantee for this growht?

(Just read a Motley Fool article, will post a new write up)

First 3 stocks chosen

11/29/2006

Simulation Policy - Modified

Carry on the investment simulation momentum of FIN7230.

Total Investment: 5,000USD
Online dealer: questrade.com, 4.95 plan

Policy:
1 2-3 stocks, at most 5
2 Cash account (no margin)
3 When price increase 10% + Delta (Daily average price change percentage), sell and get profit
4 When price fall below -3%-Delta, sell and stop loss
5 Fully invest
6 Small size stock
7 If not inrease 10% within two weeks, must replace it with a new stock.

Target: 50%/year gain.

Jim Cramer's Call - MasterCard

MasterCard (NYSE:MA) went up from IPO price of $39 6 months ago to $103.6 currently.

Checked the old news from Yahoo/Finance, found Jim Cramer commented on the stock on June 19, 2006. He compared MA with Vonage(VG)

Excerpt of the news on TheStreet.com:

MasterCard, on the other hand had a great opening, with a price that started at $39 and closed at $46. After, the stock flat-lined, but his was due to bad market conditions, Cramer said.

"I would stay away from Vonage, but I think you should buy MasterCard," he said, giving the credit card company two thumbs up.

Although there are merchants suing MasterCard and trying to undue its IPO, Cramer believes this is not a serious threat and pointed out that the company is still doing well. It is a strong business that is coming out with new products and variations on old products.

MasterCard also made a smart move by sponsoring the World Cup. This move will increase European penetration, as soccer is the sport of choice for every country but the U.S. and India. He said it is not too late to get into MasterCard and recommended buying the company's stock.

Head line news for MA since Aug.2, 2006

08/02/06:

•	MasterCard Net Tops Estimate at TheStreet.com (Wed, Aug 2)
•	MasterCard swings to a loss on special items at MarketWatch (Wed, Aug 2)

11/01/2006
• MasterCard's 3Q Profit Rises 82 Percent
AP (Wed, Nov 1)

Earnings increase pumped two jumps of the stock price.

MasterCard is a 40 years brand name. Strong brand advantage is existing...

Omnivision Technology - OVTI

Technical is good with EMA(20,50,200) acrossing. MACD is not bad (??, need to understand how MACD is calculated)

Fundamental: PE=11.04; PEG=0.66 (why these two ratio is so low for a high tech company?) Cash :383.55million; Debt=383.00K.

The company have a big one year swing from 13.85 - 34.49. There are several insider sales (CEO, founder at 15 range). It's feeling like PLAY. Its sole product is Image Sensing devices. Founded by two Chinese.

Technical Analysis

1。技术面，先看看今天我贴的SPX周线图。SPX在1380已整整徘徊了三周，并且正好受阻于上升通道的上沿。从2004年开始，SPX在从上升通道的 下沿起步，上涨150点都有相当幅度的回调，这次从七月开始到现在也正好是上涨了150点左右。再往前看2003年的强牛市，在从底部涨150点后，虽然 没有大会调，但也牛皮了一段时间。虽然150点这回事不见得会重复，但如果和别的参数结合起来看，也还是有意义的。另外，MACD, RSI等指标也明显转弱了。NAZ的波动过大，要看趋势比较难。看大势走向，还是SPX最领先，也比较容易。八月初我的那个喊牛贴，也是主要用SPX的两 年半图。 技术上来看，股市最快下周就可能回调，也可能紧贴上升通道上沿再爬一两周， 但不会有大牛行情了。
(This essay was posted on 11-10-06. Looks like the auther is a little too concervative on market projection. The chart is generate from stockcharts.com as daily chart)

(Weekly charts)

2。基本面，现在的情况和七月正好相反，那时是到处是负面消息，通胀，利息，房地产崩溃，中东，油价，，。而现在，几乎找不到负面消息，人人都在惦记 year end rally，buy dip已经深入人心。不过我就看到一点负面的东西，那就是民主党上台，从伊拉克撤军会很快发生，那中东可能要乱，那油价可能会再次飙升。 另外金子的表现很有含义。 (Very good piont. It's true, the Wall Street is very bullish currently. Has almost full position in stocks. Should exit? Shoud operate reversely against the general public? Talked this morening with Jeff, I believe for a long run the market is accellating climb very fast. The wealth creation is accellated very fast due to first to industrial revolution, later afer into 70s' due to information revolution. The cost to produce is keeping decreasing.)

3。还有一条最重要。股市的定律就是让大多数人白忙活一年，所以，，，，

year end rally 还应该会有，不过从哪一个点位开始rally可是市场说的算。

我在八月五日的喊牛贴题目是：“负面消息不断，股市已悄悄转牛！”，三个月后这一贴是“在乐观憧憬中，股市已悄悄转熊！”。

Useful online resource

(updated on Dec.09, 2006)

finance.yahoo.com (best info)
money.cnn.com (better charts control than Yahoo/Finance)
www.stockcharts.com (best techical charts)

www.ipodesktop.com (Gaskins IPO desktop. IPO road shows)

Stock&Option Exchanges:
www.phlx.com (Philadelphia Stock Exchange)
www.phlx.com/products/se1ctors/sectors.html (Sector Index Options Traded on PHLX XL)

Compendium of online essays
http://www.zwbs.net/THEORY/

Online books
http://www.8nn8.com/gpsj.htm
http://www.hej98.com/new_page_61.htm (with original English books)

散户投资心理

一 懊悔
当你经过仔细研究选好一只股票， 决定 40 买入。 结果 40 果然来临， 而且在 39-40 之间徘徊多日。 这时， 你把买入价降到 38。 可是股票经过一段整理冲上 42。 你开始懊悔了。 为什么不遵守原先拟定的原则呢。 其实 42 仅仅比你的价位高 5%。

二 不平
你不愿意 42 买进， 期待股价回到 40 在买。股价一路攀升， 直到 46 才有一次技术性修正。 你眼看着股价节节升高， 完全失去了低价买入的机会了。 媒体开始大量报道该股的利好消息和分析。。 你心里忿忿不平， 哼， 我发现这只股票时， 满世界全是不利的消息， 害的我迟迟不敢进场。

三 愤怒
股价三进一退很快突破 50。 你感到非常愤怒。 当初 股价 40 时， 被当成过街老鼠人人喊打， 某分析师还说可能跌到 30。 是你慧眼识珠。 现在这位分析师又大言不惭说他一直看好这支股票， 你真想打电话大骂他一顿。

四 嫉妒
股价很快突破 60 关口， 周围很多人陆续投入， 而且马上获得账面利润。 他们兴高采烈的谈论这只股票， 他们喜悦的笑声像针一样刺进你的心。

五 慌乱
股价攀上 70 关卡， 有分析师已经看好 100 了。 你没有一丝一毫兴奋， 因为你没有一股股票。 你心中有些慌乱， 你甚至怀疑你是否曾经分析过这只股票。

六 疯狂
股价已经攻到 80 了， 离 目标价 100 越来越近了。 你经过长时间煎熬， 已经十分疲惫。 媒体大量利好报道不断涌现。 你想 对 80 的股价离 100 的目标价 还有 25% 利润， 抢抢短线也不枉你盯了这只股票这么久。
于是你卖掉手里所有股票， 加上融资， 疯狂投入这只股票。 股价冲上 83 了。 你十分兴奋， 和周围的人一起大笑。 股价在 83 徘徊数日 开始掉到 75。 你认为只是技术性回调。 几天后股价迅速下跌， 等你发现跌势确立时， 你已经元气大伤。。。

Canadina Online Discount Dealers

www.questrade.com (better)
www.optionsxpress.ca

Follow the market trend

交易之道， 刚者易折。 惟有至阴至柔， 方可纵横天下。 天下柔弱者莫如水， 然上善若水。

成功， 等于小的亏损， 加上大大小小的利润，多次累积。
做到不出现大亏损很简单， 以生存为第一原则， 当出现妨碍这一原则的危险时， 抛弃其他一切原则。 因为， 无论你过去曾经， 有过多少个100％的优秀业绩， 现在只要损失一个100％ 你就一无所有了。

交易之道， 守不败之地， 攻可赢之敌。 100万亏损50％就成了50万， 50万增值到100万却要盈利100％才行。 每一次的成功， 只会使你迈出一小步。 但每一次失败， 却会使你向后倒退一大步。 从帝国大厦的第一层走到顶楼， 要一个小时。 但是从楼顶纵身跳下， 只要30秒， 就可以回到楼底。 　　

在交易中， 永远有你想不到的事情， 会让你发生亏损。 需不需要止损的最简单方法， 就是问自己一个问题： 假设现在还没有建立仓位， 是否还愿意在此价位买进。 答案如果是否定， 马上卖出， 毫不犹豫。 　　

逆势操作是失败的开始。 不应该对抗市场， 或尝试击败他。
没有必要比市场精明。
趋势来时， 应之，随之。
无趋势时， 观之，静之。
等待趋势最终明朗后， 再动手也不迟。
这样会失去少量的机会， 但却赢得了资金的安全。
你的目标必须与市场保持一致， 顺应市场的趋势。
如果你与市场保持一致， 利润自会滚滚而来。
如果你看错了趋势， 就得使用古老而可靠的保护伞——止蚀单。
这就是趋势和利润的关系。

操盘成功的两项最基本规则就是： 停损和持长。
一方面， 截断亏损，控制被动。 另一方面， 盈利趋势未走完， 就不轻易出场， 要让利润充分增长。
多头市场上， 大多数股票可以不怕暂时被套。 因为下一波上升会很快让人解套， 甚至获利。 这时候， 买对了还要懂得安坐不动， 不管风吹浪打，胜似闲庭信步。
交易之道的关键， 就是持续掌握优势。 　　

快速认赔， 是空头市场交易中的一个重要原则。
当头寸遭受损失时， 切忌加码再搏。
在空头市场中， 不输甚至少输就是赢。 多做多错， 少做少错， 不做不错。
在一个明显的空头市场， 如果因为害怕遭受小损失而拒绝出局， 迟早会遭受大损失。 一只在中长期下降趋势里挣扎的股票， 任何时候卖出都是对的。 哪怕是卖在了最低价上。 被动持有等待它的底部， 这种观点很危险， 因为它可能根本没有底。 　　

学会让资金分批入场。
一旦首次入场头寸发生亏损， 第一原则就是不能加码。 最初的损失往往就是最小的损失， 正确的做法就是应该直接出场。 如果行情持续不利于首次进场头寸， 就是差劲的交易， 不管成本多高， 立即认赔。 希望在底部或头部一次搞定的人， 总会拿到烫手山芋。
熊市下跌途中， 钱多也不能赢。 机构常常比散户死的难看。
小资金没有战略建仓的必要， 不需要为来年未知行情提前做准备。 不需要和主力患难到底。

明显下跌趋势中， 20－30点的小反弹， 根本不值得兴奋和参与。 有所不为才能有所为。
行动多并不一定就效果好。 有时什么也不做， 就是一种最好的选择。
不要担心错失机会， 善猎者必善等待。 在没有大机会的时候， 要安静的如一块石头。

交易之道在于， 耐心等待机会， 耐心等待最有利的风险/报酬比， 耐心掌握机会。

熊市里， 总有一些机构， 拿着别人的钱， 即使只有万分之几的希望， 也拼命找机会挣扎， 以求突围解困。 我们拿着的是自己的钱， 要格外珍惜才对。

不要去盲目测底， 更不要盲目炒底。 要知道， 底部和顶部， 都是最容易赔大钱的区域。

当你感到困惑时， 不要作出任何交易决定。 不需要勉强进行交易， 如果没有适当的行情。 没有胜算较高的机会， 不要勉强进场。

股市如战场， 资金就是你的士兵。 在大方向正确的情况下， 才能从容地投入战斗。 要先胜而后求战， 不能先战而后求胜。

投机的核心就是尽量回避不确定走势， 只在明显的涨势中下注。 并且在有相当把握的行动之前， 再给自己买一份保险（止损位摆脱出局）， 以防自己的主观错误。

做交易， 必须要拥有二次重来的能力， 包括资金上， 信心上和机会上。 你可以被市场打败， 但千万不能被市场消灭。 我们来到这个市场是为了赚钱， 但是这个市场却不是全自动提款机。

进入股市， 就是要抢劫那些时刻准备抢劫你的人。 股票投机讲究时机和技巧， 机会不是天天有， 即使有， 也不是人人都能抓住。 要学会分析自己擅长把握的机会， 以己之长，攻彼之短。 有机会就捞一票， 没机会就观望，离开。 如果自己都不清楚自己擅长什么， 就不要轻举妄动。 与鳄共泳有风险， 入市捞钱需谨慎。

做交易， 最忌讳使用压力资金。 资金一旦有了压力， 心态就会扭曲。 你会因为市场上的正常波动而惊慌出局， 以至事后才发现自己当初处于非常有利的位置。 你也会因为受制于资金的使用时间， 在没有机会的时候孤注一掷， 最终满盘皆输。 许多人勤奋好学， 开口有江恩，闭口艾略特， 说对了，到处炫耀， 亏大了，以为自己学艺不精，加倍钻研。

时间之窗，窗越开越多， 波浪理论，钱越数越少， 最后把自己弄得稀里糊涂， 自今也清醒不过来。

要知道， 所有的理论和技术都是在尊重市场趋势的前提下才能运用的好， 如果总是长期挨套， 只能说明你连股市中最基本的牛熊趋势都没分清， 看盘看得再精，数字无限神奇， 也不能改变你失败的命运。 即使再出现一个牛熊轮回， 套牢的依然还是你。 还满口索罗斯，巴菲特呢， 瞎掰！

资金管理是战略， 买卖股票是战术， 具体价位是战斗。 在十次交易中， 即使六次交易你失败了， 但只要把这六次交易的亏损， 控制在整个交易本金20％的损失内， 剩下的四次成功交易， 哪怕用三次小赚， 去填补整个交易本金20％的亏损， 剩下一次大赚， 也会令你的收益不低。

你无法控制市场的走向， 所以不需要在自己控制不了的形势中浪费精力和情绪。

不要担心市场将出现怎样的变化， 要担心的是你将采取怎样的对策回应市场的变化。

判断对错并不重要， 重要的是当你正确时，你获得了多大的利润， 当你错误的时候，你能够承受多少亏损。

入场之前， 静下心来多想想，

想想自己有多少专业技能支撑自己在市场中拼杀，
想想自己的心态是否可以禁得住大风大浪的起伏跌宕，
想想自己口袋中有限的资金是否应付得了无限的机会和损失。

炒股如出海，避险才安全。 海底的沉船都有一堆航海图。
最重要的交易成功因素， 并不在于用的是哪一套规则， 而在于你的自律功夫。