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Daily Speculations The Web Site of Victor Niederhoffer & Laurel Kenner Dedicated to the scientific method, free markets, deflating ballyhoo, creating value, and laughter; a forum for us to use our meager abilities to make the world of specinvestments a better place. |
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3/31/2005
Relative Strength Stocks, by Phil
McDonnell
On Nov. 11, 2004 I compiled a list of the top 10 relative strength stocks for the previous 200 days to track the recent performance of that group. Following is an update on the performance of those stocks through March 30, 2005.
Average Performance:
Top 10 Strongest stocks -24.37%
S&P 500 + 0.77%
| Ticker | Performance(%) |
|---|---|
| TZOO | -46 |
| LNG | 64 |
| TASR | -77 |
| ELN | -76 |
| GRA | -40 |
| PHRM | -41 |
| MWY | -8 |
| OSTK | -25 |
| AKS | 0 |
| WCC | 1 |
Only one of the 10 stocks has returned significant upside appreciation to date. On the other hand six of the 10 have had rather disastrous results with losses greater than 25%. Overall the market is up just under 1%.
Once again there is no reason to believe that strong relative strength is a way to pick stocks that will go up.