Tuesday, November 23, 2004

New way to identify the most tradable stocks

A friend told me to get on Scottrade and look at the memo found at "Customer Service" => "Important Messages" => "Stocks subject to a higher maintenance requirement". I smiled when I saw that 3 out of the 5 stocks that I was paying very close attention to where on the list (TASR, TZOO, and GOOG). The other stock on the list was one that I hadn't payed enough attention to until that day: GOAM. For whatever reason, Scottrade feels that they need to protect the money they loan out to people for the most speculative stocks, but this is exactly the sort of thing I'm looking for so this list is great! It is like a stock screener for the most actively traded market leaders (value investors are cringing by now!). So I've been watching GOAM for a few days and took a buying opportunity this morning off of an intra-day penant at $10.90. I've got a stop just below the bottom of the penant at $10.57 (stopping out here would be about 3% loss for me). I'll be trailing my stop just under the 8-day moving average, just like I did with TASR until I stopped out at $55.40 (bought in late October at $41.50).

2 Comments:

At 1:00 AM, Blogger Mysterio said...

Great blog. I saw your post on Slashdot regarding what you did on the side. Good symbol picks. I'm just starting out on technical analysis.

 
At 10:16 AM, Blogger gunzour said...

Fidelity has a similar list. I think they base it on the beta of the stock; higher risk stocks have higher maintenance requirements.

Another method I have used in the past to idetify potential stocks is to look at the "Most Declined" list on the NASDAQ site. Just go to Nasdaq.com and click on Most Active on the left side, then scroll down. Often you can find a stock that is being oversold on some news that sounds worse than it is, providing a good buying opportunity. I've seen a lot of stocks that take a one-day hit but then post a nice recovery the very next day. Of course, I've also seen stocks that continue to decline, so you have to be careful.

 

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