Comments on: Avoiding Doomed Sectors, Redux http://alephblog.com/2008/09/12/avoiding-doomed-sectors-redux/ Helping Institutions and Ordinary People Invest Better by Focusing on Risk Control Sun, 12 Feb 2012 22:02:53 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: David Merkelhttp://alephblog.com/2008/09/12/avoiding-doomed-sectors-redux/comment-page-1/#comment-18758 David Merkel Fri, 12 Sep 2008 18:43:56 +0000 http://alephblog.com/?p=907#comment-18758 Ruth, for those that want to do momentum trading, use the red zone. I use it primarily for value investing, so I use the green zone, and, as a result, I have to eliminate industries that are value traps (doomed, or crippled). I fish mainly in the green. I will hold stocks a little longer if they are in the red zone. More of my sales come in the yellow and orange. Steve, the momentum in the Value Line industries is not short-term, it is more like 6-12 months, so consider price and earnings performance over a year. Ruth, for those that want to do momentum trading, use the red zone. I use it primarily for value investing, so I use the green zone, and, as a result, I have to eliminate industries that are value traps (doomed, or crippled). I fish mainly in the green. I will hold stocks a little longer if they are in the red zone. More of my sales come in the yellow and orange.

Steve, the momentum in the Value Line industries is not short-term, it is more like 6-12 months, so consider price and earnings performance over a year.

]]> By: ruthhttp://alephblog.com/2008/09/12/avoiding-doomed-sectors-redux/comment-page-1/#comment-18756 ruth Fri, 12 Sep 2008 18:00:18 +0000 http://alephblog.com/?p=907#comment-18756 Your colors are reversed. The top 20 are in RED. Your text says you would choose the GREEN ones, ie all your loser sectors. Your colors are reversed. The top 20 are in RED. Your text says you would choose the GREEN ones, ie all your loser sectors.

]]> By: Steven Miloshttp://alephblog.com/2008/09/12/avoiding-doomed-sectors-redux/comment-page-1/#comment-18755 Steven Milos Fri, 12 Sep 2008 16:29:24 +0000 http://alephblog.com/?p=907#comment-18755 Hi David, I'm curious about how the industry rankings are derived. If I remember correctly, they are from Value Line; still, there seem to be a few rankings that make little sense. Life Insurance is rated as having little momentum, although recently stocks such as PRU, HIG, TMK have had decent moves; perhaps AIG is influencing that. But Heavy Construction as having strong momentum? Stocks such as FLR, FWLT, JEC etc. have been crushed lately. I bought FWLT into the panic liquidation maelstrom of the last week, and am already up nicely. These are cheap stocks, with strong balance sheets and well financed customers, but I don't think one could accuse them of having strong momentum, unless it's over the last two days. Thanks for the explanation in advance, Steve Hi David,

I’m curious about how the industry rankings are derived. If I remember correctly, they are from Value Line; still, there seem to be a few rankings that make little sense. Life Insurance is rated as having little momentum, although recently stocks such as PRU, HIG, TMK have had decent moves; perhaps AIG is influencing that. But Heavy Construction as having strong momentum? Stocks such as FLR, FWLT, JEC etc. have been crushed lately. I bought FWLT into the panic liquidation maelstrom of the last week, and am already up nicely. These are cheap stocks, with strong balance sheets and well financed customers, but I don’t think one could accuse them of having strong momentum, unless it’s over the last two days.

Thanks for the explanation in advance,

Steve

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