Which Are The Best Stocks?

Which are the best stocks? It is an age-old question raised by those who want to buy stocks. The game has been given away by the person asking the question. It clearly indicates that this person is biased and has every intention of buying stocks. The bias is that subconsciously there is a belief that stocks will rise in price. That would be the sole reason to buy stocks. If one believed that prices were due for a fall, why would anyone buy stocks?

Lost in the maze, the hype and the awe of the stock market and its incredible promise of millions is that all stocks are bad. Nobody knows in advance of a stock’s move if it will make the anticipated, hoped, predicted, prayed, and wished for move. No amount of anticipation, hope, prediction, prayer, and wish will make a stock move up in its price. It is only after the fact that a stock can be deemed as a great stock if it ended up making a significant move up in its price and made a big profit through its price move upward.

Finding Stocks Before They Become The Best Stocks

A thousand and one stocks will make a move from a certain price range to a higher price range.  A stock may make a great price move upward and still one may not make a profit on it.  Yes, the promise and salesmanship is the same.  How many times have you heard or read, “If you had bought this at $1 back when, today you could be super rich.”

Why would anyone say that? To make you want to be involved in what that person is selling. Have you ever heard, “If you had bought this stock at $100 back when, today it is worth a penny and you would have been a pauper.”  That is never been heard of because that statement defeats the purpose of tempting folks to walk into the quicksand.

Developing The Right Mind Set

Suppose you have the ability to replace the word “stocks” with “lemons.” You would be amazed at how much more clarity comes into focus if you are searching for the best lemons instead of the best stocks. For most people that is not easy to do. The mind has been programmed. Once the mind is programmed one way over years and years, it takes years to deprogram it. Once you are convinced of a certain thing, no amount of facts or case studies will unconvince the human mind. Believe it or not, even in this day and age of an ocean of information, there are people walking around believing that the earth is flat. Yes, that is an extreme example, but such is the strength of conviction of the human mind.

If one is convinced that the stock market returns five to seven percent a year over a lifetime, there is no saving such a soul. You could say that P/E ratio is bunch of baloney, and very few would agree. So instead of trying to convince, just mind your own business and do your thing your way. One day, that day may never come, or it will come way too late, when enough years of experience have passed, and the truth will dawn on some but not all. Stocks are bad.

When a bad stock makes you money, then and only then, for a bit of time, it will be a good stock. Until it turns back to being bad. Did you get out before that turn occurred?

Developing The Perfect Watchlist

Developing a watchlist is a skill. There is bias that creeps into everything. Removing the bias in developing a watchlist is a skill. Can one develop the ability to really understand what a stock is saying, without being distracted by the outside noise as well as the noise inside one’s mind? The misinformation hits us from the outside in addition to the misdirection thrown at us from within.

To develop the perfect watchlist, all you need is a pair of eyes, and the ability not to let anything else interfere with what the eyes do best. To see. To observe. At the beginning, before a move starts, all stocks are bad. As the stock moves up in price, early on in the journey of the stock price movement, many stocks will tempt you. Some stocks will seem to be going up faster than others. The human mind always wants to believe that the fastest mover will be the one that moves the furthest for the longest. The mind does not understand that real money is made over time. The one that keeps moving for the longest time has the best chance to move the furthest.

The challenge to stay in the present, to act in real time, and stick with the rules of speculation is immense. It is likely that many people have some of the same stocks on their watchlist. But just having a stock on one’s watchlist versus trading them correctly along the stock’s journey for as long as the stock that is bad is acting like a good stock are two completely different things.

Speculating With The Perfect Stock

The perfect stock can show up on one’s watchlist and still it may slip through our fingers. Either the entry was too early, or the exit too early. Moreover, perhaps the shakeout was professionally executed, and one fell off the train before it zoomed away.

There have been plenty of bad stocks that have been presented in the past few weeks on this blog. Some of them may turn out to be great stocks by the time a full cycle plays out. But it requires the discipline to sit through the ups and downs without getting hurt. And new stocks, equally bad, keep showing up. The ability to sift through these stocks, all of them bad today but some that may be good in the coming weeks or months, requires work.

All that work and still a shakeout or two can leave one behind, watching the taillights of a speeding car zooming away.

What Stocks Are On The Perfect Watchlist?

Undoubtedly many of the same stocks will be on many watchlists. A good list to start with would include PLTR, VKTX, ADMA, SMMT, NCMI, ASTS, CRNX, CVNA, EBS, MREO, VRNA, LUMN, HIMS, WIX, SERV, etc. Many of these have been discussed in prior posts. It is a given that the bottom part of the move and the top part of the move would be quite impossible to grab. The middle part of a good move can be captured. Can anyone wait out the next few weeks to months with any of these bad stocks and find out if there is a chance that some may turn out to be good?