FAQ
Q: Today
visited your website and it gives the feel that you do not profess any fluff like other
sites. A very refreshing approach!! But your lists are kind of complex, aren't they? I
mean those signals.
A: Let me explain how to use our picks lists. Generally, our signals mean as follows:
STRONG SELL (cut & run)
A. The stock is serious overbought, exceeded our target price far away, let us cash it and
put the profits in our wallet;
B. We find (or feel) dangers, encounter serious fundamental changes, or unexpected
accidents, smell the terrible bear closing to us, let's cut & run, suffer a little
loss but keep alive;
C. The stock's price hit the "cut & run" price, cut it and run away. Our
Cut&Run price is a Super Rule, IRON DISCIPLINE that we all must execute it
unconditionally.
SELL (stop)
A. The stock hit (or will hit) our target price, or is overbought, OK, the gains is very
ideal, I am not so greedy, give me the money, let us go, enjoy champagne;
B. This stock is so stupid, move so slowly, it has wasted my time too much, I do not have
patience at all, I found another better target, let me make an U-turn to pick it up. Any
way, I have already made a little money, or even lose a little bit, I don't care. Bye-bye.
SELL/HOLD
A. I have bought a stock, it is weak( or unstable ), waving up and down, but I am an
experienced investor, I am confident of this stock, I don't want to pay too much
commissions to my broker, I believe it will be strong. I maintain the long term target, so
I choose to hold on;
B. I am a new investor, I am a cautious person, the stock is so weak that I can not suffer
this kind of tensity, I prefer to selling than holding. So I decide to sell it;
C. This stock has risen for a long time ( or rose greatly ), but I am a greedy guy, I like
to make one more bite. Hold!
D. Oh, man, I am a coward, this returns is so satisfying for me, I can not wait to take
it. Sell!
E. My sweetheart, you know I am a playboy, you are so cold now that I am sorry (but it is
not an apology) that I have to change my heart and dump you because I found a new lover,
it is more attractive, hotter, and richer than you, so I choose it instead of you, I think
it will go up faster than you, but I am still loving you, once you show your hot activity
again, I will return to pick you up and hold you till you make a double jump.
HOLD
A. I have bought this stock, I am so happy because it is going up and up every day, I
won't interrupt it, just hold and enjoy it. Although it dips a little sometimes, not a big
deal;
B. I bought this stock too early, it dipped a little bit, but it is not worth to sell it
at this moment, its long term trend is bullish, I believe that, hold it on, it will not be
worse.
WATCH
Don't rush.
WAIT
This stock looks like great, but we need a better price to enter.
AIM
We are focusing at this target, we feel it will be a strong bull ( or a bear ) and we are
going to fire ( buy or short-sell ), BUT we may give up at any moment if something is
changed.
HOLD/BUY
A. Though I bought this stock a little early, it is oversold now, a better entry chance
has appeared, the future should be wonderful, but I don't have more money to buy it, so
just hold it;
B. I am an aggressive investor, I like to take a chance to act before other guys find this
gold mine, even if there is a little risk, so what? I don't care, buy it now.
BUY
Most of facts prove that is a good chance to invest/speculate at this stock now, if you
won't, I will.
RE-BUY
In our Long-Term Trading lists, "RE-BUY" means "buy again", there is a
little difference with "BUY" signal. "BUY" means I never did it
before, but "RE-BUY" means I had bought it before and sold it, now I will buy it
again. Especially, this signal warns new buyers, it may be not suitable for them because
the price is too high for a new buyer.
STRONG BUY
Just do it!
Are you still feeling it is complex yet? It is simple when you have understood what those
signals mean, isn't it?
Q: Also,
do you advise only buying on the day the stock is recommended?
A: These signals on our lists are following the market's changes every day, so if I were
you, I would follow the newest issue to operate. While I am making an "alarm"
such as "pick XYZ" or "dump ABCD" in our newsletter, I do not mean
only doing it on the day the stock is picked. Actually, I send the newsletter after the
market is closed every workday, the last price means the close price, it is a base of
action on the next day and following days. A buy or sell price uncertainty between +5% and
-5% will be reasonable ( You can adjust it to 3% for short-term list or 10% for long-term
list according to your experience. ). For example, if I had said "buy XYZ, last
price: $10.00, target price: 20.00, target date: November 21, 2002" yesterday, but
XYZ opened at $8.90 then dropped down to $8.60 today, you should wait and give me one day
to think and calculate what should we do until next newsletter is issued. On the other
hand, if it jumped up 10% when the market was opening in this morning, let it be, do not
hesitate to buy it, and do not feel regrettable, we might lose one chance only, but there
will be more chances ahead.
Generally, I will maintain the long term target but adjust the buy or sell price following
the market's flurry, except some serious fundamental changes occur.
Q: I
bought a stock following your "strong buy" signal in your list, but it dropped
terribly, why?
A: First, please read our disclaimer and advice here: http://www.irisfund.com/Irisfund/advice.htm
.
Secondly, you can see each signal may have several different means, under different
situations, for different investors who have different characters, and during different
time. They are flexible, except the inflexible Super Rule, IRON DISCIPLINE--"Cut and
Run". No matter which signal appears, even the "strong buy", if only the
stock's price hit the "cut & run" price, do it at once, cut it and run away.
Our Cut&Run price is an iron discipline that we all must execute it unconditionally.
We have emphasized it to our club members many times, again and again.
Thirdly, I try by best to offer you my research results, points of view, and information,
but you must do your homework to try your best to make the final decisions. That is very
important because every investor has his own individual character, experiences, and
habits, base on the same information and signals, they will make quite different decision,
no one can replaces you to give the "final answer". Loss is one part of
investment, no one can totally avoid making mistakes, even Mr. Greenspan. It is impossible
that every decision we make must be right, but, over 70% success rate, this is a
confidence we have. You must understand there is still 30% of probability to encounter
loss, before you decide to follow us. we have told every reader and member about this
early.
Q: I like
to hold 8-10 stocks. It's disappointing that in your Long and Short-Buy lists there's only
one buy signal today. This is a little frustrating when the market is moving as well as it
is.
A: You have done a right thing that spread capitals around several stocks. It will reduce
risk. Especially, it will increase opportunity of hitting targets using our stock picks
lists. We always hold 3 stocks at least. But, you forgot one important thing...
Patience is every thing, in stock market. A good investor or speculator should be a
patient hunter in jungle or a cool fisher beside lake. Don't show our temper shooting
everywhere before the bear or the bull appears, don't speak loudly before the fish bites
the bait. It is not strange at all if the buy signals are few or even none sometime. One
year has 365 days, there are many chances ahead. Between more buy signals but low success
rate and less buy signals but high success rate, which one is your favourite?
Q: I have
not received your short-term list since last week, what happened? ( Mar. 13, 2002 )
A: It is not a good time to do any Short-Term trading recently, we think. The market is
very bearish and overbought now, it is so risky that we let our Short-Term trading list
empty. One of our list's value is avoiding risks automatically, when the market is
overbought, our system can not pick targets to buy but can pick targets to short sell. It
is an unique and amazing advantage, isn't it?
 Please inspect our historic stock picks
record
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