My daughter just popped in to ask what I was writing, and when I told her it was our latest Investor’s Business Daily review, she just about fell asleep, but she’s 9, and you’re not - so dive in.
I must admit, I have a little penchant for Investor’s Business Daily (IBD). Why? Because of the book “How to Make Money in Stocks” by William J. O’Neil. What does it have to do with Investor’s Business Daily you ask? Through that book, I discovered investors.com, the home of IBD and the reason for my affinity with this Investor’s Business Daily review.
In fact, this is where I first learned some of the ‘fundamentals’ of investing. Let's try to address some common questions about this service such as "What is Investor Business Daily?". "How much does IBD Leaderboard cost?". "How much is a subscription to MarketSmith?"
Bill O’Neil founded the newspaper Investor’s Business Daily in 1984. The newspaper printing is weekly. However, the website publishes business news daily. Investor’s Business Daily is a leader in financial news and research, helping investors find top-performing growth stocks.
O’Neil, who is the author of a dozen books, including the best seller “How to Make Money in Stocks”, is the creator of the CAN SLIM investment strategy. Maybe you’ve heard of this approach.
It was made famous by Dan Zanger, who apparently grew $10,000 into millions of dollars during the dot-com bubble.
When you read that kind of performance, you probably want to find out what it’s about. CAN SLIM is an acronym for growth stock investing strategy. It was developed by Bill O’Neil who compiled a database of every stock traded in the US since the 1880s.
In fact, after studying the data, O’Neil saw that winning companies had the same seven traits in common. As a result, that's the basis of the CAN SLIM Investing System on which all of IBD’s products and features are based on.
Here are the attributes making up the CAN SLIM acronym:
Current Quarterly Earnings: Stocks with increases in current quarterly earnings growth.
Annual Earnings Growth: Stocks that have grown their earnings for the past 3 years.
New Product, Service, Management: Companies with something new like new game-changing products as well as services.
Supply and Demand: Signs of heavy-volume accumulation by institutional investors.
Leader or Laggard: Leaders in strong industries that are showing superior sales.
Institutional Sponsorship: Follow what the big money (mutual funds, pension funds, etc.) is doing.
Market Direction: Stocks that follow the market's general trend.
The IBD website, investors.com (not to be confused with investing.com), will be your best source if you want to dig deeper. It doesn’t involve day trading much.
However, the strategy combines fundamental with some technical analysis particularly the "cup-with-handle" chart pattern. In fact, day traders may actually benefit from understanding the Investor’s Business Daily methodology; as it may improve their stock picks.
Hence the reason for this Investor's Business Daily Review.It’s easy to get overwhelmed by the number of options and products from the investor business daily website. As you browse, you discover eIBD, IBD University learning center, IBD TV market videos, IBD Stock Checkup®, IBD investment workshops, CAN SLIM Home Study programs and the list goes on. Investing is not easy. However, if you’re willing to spend time (and money) to master the CAN SLIM strategy, investors.com will get you there. Reading Bill O’Neill’s books will also give you an understanding of investing using his CAN SLIM approach. In fact, it will cost you a lot less. The cost of IBD's subscriptions starts at $269 per year (IBD Digital) up to $1499 for the Marketsmith premium service.
The fundamental philosophy of William O’Neil is that investors should buy stocks for their growth potential, not for the sole purpose of buy and hold. For that reason, it may be more suited for swing traders and short-term investors.
As a result, Bill O'Neil says, "The secret is to hop off the elevator on one of the floors on the way up and not ride it back down again." Investors business daily line of products is all based on the CAN SLIM system.
Some of these products have dramatically outperformed the S&P 500. In 2017 for example, IBD’s Sector Leaders Index beat the S&P 500 by 300%.
A little warning for traders who prefer to stay away from higher-priced stocks, CAN SLIM tends to lean towards established large-cap stocks; often with a high price and a high float. Those may not move as much percentage wise on a very short-term basis.
Keep in mind also that, to use O'Neil's analogy, not all elevators go up at the same speed when you ride the stock market. As a result, some elevators go down faster than going up; regardless of the size of the float or the market cap (watch us do trading live streams each day in our chat rooms).
According to the IBD approach to making money in stocks, it requires similar routines as making money with day trading. You must recognize your biggest mistakes in order to correct them.
Then adjust your rules accordingly. Pay attention to the market conditions. For example, when the market is volatile and choppy, you may want to book your profits sooner to avoid giving them back.
In fact, as Investor’s Business Daily strongly recommends, check in daily! In other words, watch the market every day. Do you see the similarities with day trading?
When I started day trading, I was looking for a winning system. Who isn’t? The tagline of the book "a winning system in good times or bad" really got my attention.
There were bad times for a long time. In fact, trading can be hard. However, it’s a lot harder if you are not prepared and educated.
Trading is not for everybody either. The Bullish Bears team are straight talkers. If you want to become a successful trader, then it’s going to take time and hard work.
The good news is that the Bullish Bears probably have the most complete and least expensive education available to learn stock market trading and become a profitable trader.
The Bullish Bears trading service isn’t about the money. We’re all about helping you and growing a community of traders that support each other. Are you ready to start?
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