Monday, April 26, 2010

Basket of Income

Here is a summary of the Basket of Income Stocks that I sent out to the email list on April 3rd.  As you can see, in addition to the approximately 1% per month in dividends, the basket is up an additional 3.25% in less then one month.

I put a hypothetical $3,000 into each of these ten stocks at the open on April 5, 2010.  These stocks are all using a low-volatility ATR stop, about half the volatility I use as a default on the other stocks.  That has resulted in a more stable trading environment, much fewer trades over the course of the year, albeit at the cost of some additional price slippage on entries and exits.  I am also using only Weekly charts, which in and of itself reduces trading.  So far, this "more patience, less trading" approach has been niecly profitable and a very easy model to manage.

Will this technique ultimately migrate into the entire trend following model? 



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