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Three Strategies To Find Strong Trend Stocks

2011/2/14 16:27:00 46

Stock Picking Stock Market

At present, there are about 2000 cities in Shanghai and Shenzhen two cities.

Individual stock

It gives us enough choice.

Stock selection

Even a bear market has the possibility of absolute return.


Of course, select strong trend stocks.

paction

This is the best starting point for investment success.


What is meant by "strong trend stocks"? I think it should be interpreted in two meanings.


The first level is trend stocks.

Opening up the charts of different stocks, we can intuitively find that some stocks are in a neat way, rising up is all the way up, while some stocks are very sticky, and the three step is to go back to two steps.

The former is very relaxed, so long as all the shares are held up, the latter will continue to suffer. If they are not careful, they may be left out of the coffers. Even if they are not shocked out, they will see that the stock price is up and down.


The second tier is strong stocks.

Why is it possible that only a portion of investors can double their market value in a bull market? It is very important to select stocks, especially those bullish stocks with double index and multiple share prices.

If you encounter vulnerable stocks, even in the bull market, the increase will also lose the index, even if you continue to seize the band opportunities in the short term, the final result is not necessarily a fool compared to others, because you lose at the starting line of stock picking.


So, how can we capture the "strong trend stocks"? Let's break down the steps and start with the selection of strong stocks with high volatility.


First, use Beta to select strong stocks.


The statistical Beta index is undoubtedly the best choice for completing this task.

Specifically, how to calculate the Beta index is not introduced in detail here. The meaning of Beta index is simply introduced.

Suppose that the Beta value of a stock relative to the Shanghai and Shenzhen 300 index is 1.5, which means that when the Shanghai and Shenzhen 300 index rises 1%, the stock will rise by 1.5%. Of course, the Shanghai and Shenzhen 300 index will fall 1% while the stock will also fall by 1.5%.


If investors need to calculate the Beta of their own stock, they can use the built-in Beta function of the most common credit card stock system.

With this indicator, you can identify stocks that may outperform the Shanghai and Shenzhen 300 index.


Two, use system test to select trend stocks skillfully.


Then, how do we choose the trend stocks? There is also a very simple way to test the quality of a stock by using the most basic system of average trading, that is, using a short-term average and a long term moving average as a buying and selling signal, and the short-term average line buying through the long term moving average.

If a single stock can get a good return even in such a simple way, it can be regarded as a standard trend share.


To achieve the above procedures, we can make use of the test of the Tongda system parameter, and then join the test of stock pool stocks (such as the Shanghai and Shenzhen 300 index stocks), then choose a large bull market band, such as October 2008 to June 2009, then choose the MA- average trading system, and set up the trading system parameters according to their own preferences, such as the 2 day average and the 30 day moving average.

Finally, according to the results of the system test, the stocks with the highest total return are selected as the trend stocks at this stage.


Three, pay attention to the characteristics of the industry sector rotation.


I believe that investors can choose the most explosive stocks if they compare the trend shares and the strong stocks list.

Of course, when we use these two indicators to select strong trend stocks, we also need to consider the industry background of these stocks.

Looking back at all previous quotations, we can see that most of the time the plate has the characteristics of rotation, and another industry will pick up after an industry has gone up.

Therefore, when we set up the stock pools of strong trend stocks, we must consider a number of industries so that the east does not brighten the West.


Since January 25th, the stock index has bottomed out at 2661 points, and has gradually recovered its lost territory. In turn, it has been on the 5, 10, 20, 30 and 120 day moving average.

In all previous large scale rebound markets, stocks appeared "Matthew effect", strong and strong, investors were afraid to catch up, weak and weak, until the weak stocks began to fill up, and strong stocks appeared callbacks, the market often came to an end.

However, there are always some people who can get better returns in the rebound market. Therefore, I believe that the success of the chase depends entirely on the investors' understanding of their behavior of catching up and the application of the method of catching up.


Conditions for catching up


First, we must have an environment.

Because of the continuous growth of the national economy, the stock index has overturned and rebounded, and over the counter funds have continuously poured into the stock market. The duration of stocks has been rising for a long time. This creates the best market environment for the chasing people, and the success rate is much higher than that of the bear market and the equilibrium market.


Two, hot stocks should be chosen.

The most dynamic market is profit driven speculative capital. Hot stocks often collect such large funds. Therefore, we should take stock of the duration of hot stocks to see whether it is staged.

Once the hot spots fade, it is easy to catch up.


Three to chase strong stocks.

Most of the strong stocks are due to the obscure news of listed companies, such as rich themes or mergers and acquisitions, and so on. It is obvious that the main force of foresight is often stationed in advance of such stocks. Generally, the rising space is large, and the duration is long. Until the good fortune is fulfilled, the dust settles and the profit is settled.


The way to catch up


First, we must catch up.

If we follow a stock for a long time, we will be familiar with its stock and understand the reasons for its rise in time.


The two is to buy or not to buy.

It is not appropriate to place an order immediately after the stock price is rushing high, so that it can follow up at the relatively low level when finishing the inventory.


Three, buy first and then increase.

First, buy a stock tentatively with a small amount of money, and wait for upward trend to be clear, and then increase in batches, time and price.


Four depends on the amount of energy that can be accumulated.

The size of the funds invested in individual stocks determines the height of the stock price. The amount of hot stocks can be accumulated. Only with the continuous promotion of incremental funds can the market continue.


Fifth, pay attention to the way of operation.

We must catch up with the stocks that have successfully broken through the downward trend of the long term pressure line, and have succeeded in breaking through the stocks in the intensive trading area, and have succeeded in breaking through the stocks of the consolidation box.


The main points of catching up:


First, avoid mistakes in judging trends.


Two, overcoming prices should avoid being overpriced.


Three, do not put all your eggs in one basket.


Four, the profit target should not be set too high.


Five, when the market is weak, we must not blindly stick to it.

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