Alerts
Alerts Say “Check This,” Not “Buy” or “Sell”
1. Alerts are not sent to subscribers. We conduct our scans after the market closes and then process the data with our algorithms. Finally, we post the results for subscribers to access at their convenience by the use of a password.
2. There are far too many stocks to be watching them all closely all the time in order to find those stocks that are in a “setup” pattern. Therefore, our algorithms are designed to find stocks that satisfy certain basic requirements in order to narrow the field down to a more manageable number of candidates that have passed those preliminary screens.
3. When we use the lists ourselves, we may eliminate 90% of the stocks on a list (or the entire list) because of nearby resistance or some other consideration. The algorithms cannot “see” what a human could easily see on a chart that would be a reason for avoiding a stock. For example, they will not detect overhead resistance that may be just a little above the current price. It will be up to you to inspect stocks visually with a chart or by whatever means you use to determine whether or not a stock is worthy of investment. Our lists are not “buy” or “sell” recommendations. They are alerts indicating that certain preliminary conditions have been met.
4. We do not buy a stock because it is the stock of a great company. Timing is everything to us. There is a right time and a wrong tome to buy any stock. We look for stocks that have completed a “setup” configuration. A “setup” is a stock chart pattern that is usually seen just before or at the beginning of a price surge. Stocks tend to move further and faster after a setup configuration has been completed. For example, a stock is much more likely to rise if its 5-day moving average has just crossed above its 20-day moving average (even more so with a surge in volume), if it has gapped up with a surge in volume, if it has broken out of a trading range, if it has declined to its rapidly rising 50-day moving average and is just rebounding from the support there, if it has had a Bollinger band squeeze and then penetrated the upper band, if R.C. Allen moving average alignments have just been completed, and so on (some of these setups are illustrated near the bottom of our “Stock Alerts” page).
5. Since the lists can be long at times and you may be short on time, you might not want to check every stock on a list. The “Strongest ETFs” and “Strongest Stocks” lists are ranked in the order of our strength measurement. The other lists are ranked by the magnitude of the volume surge that took place when the alert was generated. Therefore, you might prefer to check only a few of the stocks at the top of a list each day (or whenever you are looking for new candidates). Certain lists will be very short when market conditions are poor. Those same lists will expand when the environment is a better place to invest. Strongest ETFs, Strongest Stocks, and Hot Stocks always have 100 stocks per list because all stocks (thousands) are ranked according to their metric and 100 are selected off the top. The other lists may have up to 100 stocks, but they often have less, depending on market conditions relative to the type of setup that is being targeted.
6. FILTERING:
In generating our reports, we scan a Reuters database, which has over 8,000 issues. With such a large database, there will be a large number of stocks trading only a few shares a day. Suppose that in one of our “explorations” our algorithm finds a stock that generates an alert, that had a 120% surge in volume, that it is a $3 stock, and that has an average daily trading volume of only 900 shares ($2,700). The problem is that it would displace a stock that traded $5,000,000 a day with a volume surge of 50%. The latter might be pushed below the cut-off point for the list because of such low-priced low volume stocks. To help with the liquidity issue, we take the closing price and multiply it by the 50-day average daily volume and use $500,000 as the cut-off point. This filtering procedure is intended only to reduce in our reports the number of higher-quality stocks that are displaced by stocks of much lower quality. It is not a substitute for your own responsibility to check the daily and average volume of a stock before investing in it. Besides filtering out stocks with a 50-day average trading value of less than $500,000 a day, we also remove preferred shares from the list of potential candidates because most charting programs do not accept their symbols and because we believe common stocks have greater potential profitability. Why include preferred issues in our reports if subscribers cannot see them on a chart? Finally, we try to remove stocks that did not trade on the day the list was generated. That’s because they may have just been de-listed, or they may be having difficulty meeting the listing requirements of the stock exchange.
7. Sometimes you will see cheap stocks (often referred to as “penny stocks”) on our lists (generally, they must have recently traded at least $500,000 per day to be included). People have requested that we include them. We indicate the price/share of the stocks on our lists. We personally prefer to avoid stocks priced at less than $5.
8. It is your responsibility to check the average and daily volume of a stock before investing in it. Many experienced investors and traders will not buy more than 1% of a stock’s daily share volume. They feel that will enable them to sell more easily (and without influencing price).
9. OUR REPORTS REFLECT CURRENT MARKET CONDITIONS
When the market has been in a lengthy or severe decline, you may notice that stocks listed in our reports do not look as healthy as they did when the market was strong. For example, when the market has been in a prolonged decline, stocks listed on the Strongest Stocks list may look strong, but not as strong as when the market was strong. That is because the stocks in the database are ranked relative to each other to compile the Strongest Stocks list. Even if all the stocks were declining, we would list the stocks that are the strongest. That would mean the list of “Strongest Stocks” could consist entirely of declining stocks, though that would be extremely unlikely because there are almost always plenty of stocks that are rising. As the market improves, the stocks on the list will also look more attractive. Lists of stocks with greatest strength, momentum, or volume surges, are constructed by ranking stocks relative to each other. Those lists will always have the same number of stocks, regardless of market conditions. Other lists require a specific event (a gap, a Bollinger band squeeze and band penetration, an R.C. Allen signal, etc.). There will probably be fewer that qualify to make it on the list when the market is weak. It the market has been in an extended decline, it is possible that there will not be any stocks that have generated a a particular bullish alert, but there may be many that have generated certain bearish alerts.
The market may favor one type of stock or setup at one time and it may favor a different type of stock or setup at another time. However, if you are subscribing to Valu-Pak, you can shift from one strategy to another (go wherever the setups look more promising). For example, the alerts generated when stocks have a rapidly rising 50-day moving average and where the stocks have just declined to that average and had a trigger event might be profitable more often than alerts that are generated because of a Bollinger band squeeze alert and an upper band penetration. Or, the reverse might be true. Thus, Valu-Pak subscribers can monitor the different types of alert, determine which are producing the best results at a given time, and focus on those alerts. That is why we created so many different types of alert for our own use. The market sometimes changes in what works best. If you do not subscribe to Valu-Pak, monitor what happens with the alerts you get. Generally, setups give an investor an edge regardless of what the market happens to be favoring at the time. As the market pulls out of a funk, the stocks generating an alert will look more and more attractive and the alerts will become profitable more often. When the market turns sour, the list you subscribe to may diminish in size, and may even lack any stocks at all. That should be seen as a positive, not a negative. That is, an empty list is actually helping you stay out of trouble. It is giving you a way of disciplining yourself. If you practice the discipline of investing only in setups and there are no setups, then do not abandon your discipline. Keep monitoring setups, but stay out of the market until you find setups that are attractive to you. That is one of the benefits of focusing on setups. They help a person avoid speculating in “story stocks” and the latest “hot” idea (the kind of stocks that often lead to the effective annihilation of a portfolio). If the setups are not attractive, then abandoning the setup discipline is like the suicidal jump from the frying pan into the fire. Precision in the timing of entry points is a very big part of making profitable investments. Abandoning setups is like saying, “because the setups are not giving me attractive stocks, I will no longer try to find timely stocks.” Setups help a person target the most timely candidates.
10. Before you subscribe to any of our reports, it is important for you to understand their intended use. We expect our subscribers to use them the way we use them. See what we mean by “setups” and how we use our lists .
11. I do not want to waste my money subscribing to something that does not work for me. How long is a reasonable test period?
12. We do not “switch” a person from one subscription service to another. An order for a subscription must go through the Payment Gateway because we do not handle credit card information. The Payment Gateway provides a high-security venue for processing such information. The Payment Gateway does its job when a person enters an order for a subscription on our Website. The order is routed directly to the Payment Gateway. if a person wants to try a subscription that is different from his current subscription, he must place an order for that service just like he did for the original service. If he wants to replace one service with another, he must order the new one and cancel the first service. He may cancel a subscription by sending us a cancellation notice (an email is sufficient to do this). If a person is not sure which service to select, he might try Valu-Pak. That way, he can sample a large variety of services. When he discovers which services are most suitable for him, he may cancel Valu-Pak and order only the desired services. The fee for Valu-Pak is the same as the total cost of subscribing to 3 services.
13. When an individual cancels a subscription, the cancellation will become effective at the end of the current paid-for period. Generally, the phrase “current paid-for period” means “current month.” There are no refunds or credits for partially used paid-for periods. However, a subscription and its paid-for access will continue until the end of the current paid-for period. There will be no additional charges after the current period. For more information on Trial Periods, go to Trials For information on refunds and cancellations, go to Policies