My Home     About Me

Yesterday, we highlighted how astute investors who may have bought Yahoo YHOO near its lows, might be looking at 1000% gains sometime soon, if YHOO can break out above $40 and set 5 year highs. That's one way of making big money and is our reasoning behind the wisdom of buying stocks with developing momentum and significant upside potential. Ann Scheiber was able to capture long term gains mostly in the Blue Chips of yesteryear, that over time yielded Yahoo type gains and enabled her to deliver some of the largest compounded annual returns in history, ranked right behind Warren Buffet and other investment greats like Peter Lynch.

In a way for many this can be a hard way to make money, because Investors lack the discipline and patience to pursue such a long strategy and see it through to the kind of spectacular conclusion that Ann Scheiber reached, in her turning of $5,000 into $22 Million over 40 years. What is interesting to note is, had she still been alive today, just 10 years later, her net worth might be $50 Million.

Turning $5,000 into $50 Million has a nice ring to it, but Ann Scheiber, Warren Buffett and Albert Einstein have each given Investors of this World a huge gift, because they have shown what is possible and have set the bar very high for other investors to follow in their footsteps. So how and where does Albert Einstein fit in: Albert Einstein described the power of compounding as: The 2nd Great Wonder of the World and all investors should take note, for it is the power of compounding that has enabled investment greats of our time to reach the stunning pinnacles of investment success, that years ago would have been declared impossible to achieve.

So now that the torch has been passed and the way has been shown, as we recounted yesterday, we need to think and act like Ann Scheiber more and more every day and set the very highest goals possible for ourselves to aspire to. The ever popular comic and commentator Ben Stein, is telling us every day and is out there pounding the table for investors to act now and start saving for their future, even if they have to cut spending and live as frugally as Ann Scheiber did for all of her life. Investment legend Jim Rogers who knows more about the power of compounding than just about anyone, as co-founder of the Quantum Fund, perhaps the most successful fund of all time, preaches the same with his record of calling oil's huge rise unsurpassed. He's right to be spreading the gospel of compounding and investing for the future, because, as we have been pounding the table ourselves along this same theme, no-one could foresee at the same time back at the last Century's lows, that the Dow would rise almost 1,000% over the next quarter Century or back in the mid 1950's that the Dow would rise nearly 50 fold thereafter and help Ann Scheiber to grow her fortune in the next great investment upwave of the 20th Century. To dismiss the likelihood that a similar powerful new upwave may have mostly started between the last quarter of 2002 and the first quarter of 2003, would have been folly indeed for anyone back then and yet there were many, including the great Warren Buffett himself and Bond King Bill Gross, who could not see the emerging bull market starting to take shape, against what was then a weaker economy, even if he did get the Bond market mostly right in the process!

Perhaps the most stunning statistic that adds credence to our theory that economic growth may actually accelerate for much of the 21st Century for a great many economies, as they emulate China's meteoric growth is our other theory being that as the World gets richer and international trade continues to increase exponentially, that all World markets might also grow at a much faster rate than previously experienced during the 20th Century and visible proof of this can be seen in the charts of the past 100 years, that clearly show an accelerating trend of shorter recessions, leading to more rapid recoveries to new all time highs, than ever before in many indices, most especially the many recent examples quoted here, wherein the post 2000 new all time record highs were recorded so quickly, following what for many was one of the most severe corrections ever experienced, in terms of numerous high tech issues.

As we've stated many times before, there is nothing more powerful than a stock or market setting new multi-year highs or all time record highs, as has been visibly demonstrated by Google GOOG of late and the S&P 400 MidCap and Dow Transportation indices.

There is no time to waste. The market will not wait if it wants to move higher it will do it again as relentlessly as it did just last week. In our own race against time we try to position ourselves every day to do what may have taken Ann Scheiber months or years to do.

It's been demonstrated that buying the Dow for the next 6 months versus the ensuing 6 months, historically could have yielded staggering improvements in bottom line performance over the past 50 years or so. Imagine if Ann Scheiber had done that? She didn't, but she was still able to deliver a truly legendary performance. Today, we have so much more at our disposal to help us to emulate what she has done, we can initiate such strategies and we can also short stocks when occasion calls for such actions.

The real key to becoming the next Ann Scheiber is to try and do in months, weeks or even days, what Ann Scheiber managed to do in years. It can be done: Through our MODAR service, we are proving it up, live in real time, every day. But like anything that is hard to do and fraught with risk, it is no walk in the park and requires intense application, concentration and rigid disciplines. We were aptly reminded yesterday, how important it is to have to fight for every point and in that alone, can mean the difference between a mediocre performance and a stunning one. Monday, we were surprised by a larger than expected opening gain on an issue we first highlighted at $0.95 and a little expensively as it turned out, on Tuesday November 01. For much of the day we were offered the opportunity to take a 10% gain on Nayna Networks NAYN, in what could have been a loss on Friday. Although Nayna continues to look opportunistic, our lower stop took us out for a 6.3% gain, effectively leaving an extra 5% on the table, that we absolutely should have booked. Numerous examples like this over a trading year can amount to astonishing additional gains. Viz: 5% x 200 trading days = 1000% gains. The discipline of stops is just as important one's the quest for additional gains. This time a well placed stop yesterday morning on another issue, that we highlighted last week at $2.45 being Puda Coal PUDC, took us out at $3.60 stop. Not all situations work out this well, but our goal is to continually add percentile gains every day in accelerated compounding mode.

iShares Hong Kong (EWH)   Technical chart patterns   support/resistance levels   ETFs (exchange traded funds)   Deron Wagner   S&P 500 chart pattern   emini's S&P 500   earnings   economic data   Biotech HOLDR (BBH)   Emini's Nas 100   Short selling ETFs   exchange traded funds   sector rotation   etfs   corn futures   selling options   commodities   mcio   minecore