To The Moon Laid To Rest

I've tracked my To the Moon screen for a few years now and it's time to let it go. My intent in creating the screen was to show that even a simpleton like myself could put together a winning screen if it was followed without emotion. Since September of 2005 the screen has made over 300% compounded.

The screen was made up of the highest Relative Strength stocks in four different screens I ran. One screen was AAII's Zweig screen and the other three were Screens from Zacks Research Wizard. I just took the highest Relative Strength stock of these three screens:

bt sow best buys
bt sow big money
bt sow filtered zacks

This was a "buy on Monday sell on Friday" stock screen that did very well in a pretty lame market. I wanted to show that there are opportunities in the market for individual traders who don't have a lot of time and who don't want to have to monitor the market on a consistent basis.

My subscription to Research Wizard runs out this summer and I don't intend to renew. I think Research Wizard is a great product, but for me it is too pricey and I don't like that it doesn't have an established community of users who share ideas and information.

I will continue to use AAII's Stock Investor Pro as I work on new ideas while following the simple screens that I've been watching for the last several years.

AAII's Stock Investor Pro

Members of the Kirk Report voted Stock Investor Pro their number one stock screener. I'm surprised that Zacks Research Wizard didn't make it in the top 10. I think Zacks has priced themselves out of the market when it comes to individual investors. That's too bad, because it really is a powerful screener.

Reader Question about Stock Investor Pro

I haven't answered a reader question on the blog for awhile and this just came in tonight:

I haven't had much time to visit your blog and apologize if you have talked about this recently and I missed it. I am a user of AAII Stock Investor Pro and although I do love it, I sometimes feel I am missing out on a few features that Zacks research wizard has. So my question is would you recommend Zacks Research Wizard over SI? Is it really worth $1400 more? I can't justify both (probably can't afford RW) and need to renew SI Pro soon.

It really depends on your style of trading. I like them both—but right now I prefer SI Pro for a few reasons:

1) Price—you can’t beat if for what it delivers

2) Built in screens (I really like the amount of data available on the included screens)

3) Familiarity—I’ve been using SI Pro since 2004 and I still like it a lot

However, I’d like to see SI Pro have some ability for testing without the cumbersome downloads of weekly data. I’d also like to be able to backtest ideas with it (AAII does it on their new stock screens so it’s not out of the question).

I like the speed and constant data updates that RW wizard has. I like the backtesting, but I am becoming less enthused about the results. It seems like whenever I pick a strategy that produces amazing returns, it quits working when I start tracking it. I really don’t know how to explain it, but it concerns me.

Another thing that I don’t like about Research Wizard backtesting is it creates way too many variables for me. I’ve developed some ideas that work, and the ability to quickly analyze other ideas too often causes me to question my own trading and really gets me off track. For me it’s best to narrow my focus and stick to my trading plan rather than trying to discover the next “golden ticket”.

So for now, I’d recommend that you save the money and stick with SI Pro.

Zacks Research Wizard Review

It has been one month since I purchased Zacks Research Wizard and I've had many inquiries into how I like it. As most of you know, I'm an avid user of AAII's Stock Investor Pro and I like it very much. I will continue to use it because it has proven itself over the last few years and I've found the folks at AAII to be reliable and the information in Stock Investor Pro to be accurate (and profitable).

To be fair, I have very limited experience with Research Wizard. However, I have been able to run a bunch of backtesting and various screens over the last month and three of the four stocks listed in my "To the Moon" portfolio are stocks I pulled from Research Wizard screens that I've put together.

First I'll let you know what I like:

It's Fast.
With Stock Investor Pro I get information on a weekly basis that I have to download to my computer. I then have to unpack the file and run the screens using the program.

With Research Wizard, the data is centralized on Zacks servers. When I run a screen, my computer (which must be online) grabs information from the server and displays the results in one to two seconds. Even backtesting huge amounts of information only takes a minute or two at the most. That's cool.

Backtesting.
It used to take me hours (or even days) to test a theory I had about a particular screen. I often had to go through old spreadsheets or hard copies to figure out how particular ideas performed. Stock Investor Pro has no backtesting capability built in. To test ideas I would download historical data (on a weekly or monthly basis) and run the software to see what stocks met criteria.

With the backtesting, the process is almost instantaneous. That gives me the freedom to dream up an idea and test it almost immediately. I know that backtesting has its problems and inaccuracies, but it can give a very good idea of what works and what doesn't.

It's very easy to use.
I've worked with several screening programs. Some make my eyes glaze over as I read all of the mathematical formulas that I need to punch in to create a screen. Research Wizard is extremely intuitive. I really like the ability to pare down my screens and find the "Top" stock in a certain percentage, relative strength, volume, etc.

What I don't like:

It's expensive.
At $133 per month, it doesn't make sense to use it unless it is helping you to beat the market substantially. The verdict is still out on whether or not Research Wizard will make my trading better, but the results of the "To the Moon" screen so far suggest that the possibility exists.

Marketing for Research Wizard is confusing.
I'm not an idiot, but I had a hard time weeding through the Research Wizard web site to get the information that I needed. The folks on the phone are much more helpful (they have to be to make a sale), but I would have appreciated knowing the price up front ($1,600 per year). Also, there is an add-on that allows more complex backtesting that I assumed was included in that price. It isn't. It's $1,600 MORE. It looked interesting but I couldn't justify the price, yet.

I feel a bit isolated.
With the amount of information that Research Wizard generates, I'd expect to see some sort of community or forum dedicated to sharing winning strategies or interesting ideas. Zacks sends an e-mail every day, but it's kind of a conglomeration of all Zacks does. I love information and I would like to see more coming from Zacks about Research Wizard.

Well, that's my take so far on Research Wizard. I'll continue to keep you up to date about my satisfaction in upcoming months.

Why do I look?

My portfolio came screaming out of the gate this morning and my heart started racing a bit as I was up nearly 2%. Of course, I had to look again at lunchtime and I've given back most of that.

Charles Kirk posted a good article about being a perpetual student. He used a golf analogy. I don't like golf, but it made sense.

I've been using Zack's Research Wizard for about a month now. I'm putting together a "review" for this weekend.

I hope everybody had a swell 4th of July. I did.

StockPunk Stock Screens

A few readers have expressed that they've been a bit confused by the screens that I posted last week. My intention was to discuss a screen a week in detail.

I've removed one of the screens that came from my playing around with Research Wizard. I think it's a bit too soon for me to post screens based on the Research Wizard because I've used it less than a month and I'd like to test things out over the next year.

The "To The Moon" stock screen is kind of a hybrid using AAII's Stock Investor Pro and Zack's Research Wizard. It encompasses my own ideas about what stocks are about to take off and is a short-term (week to week) trading strategy.

Those of you who are following the screens closely can see that there are just a few changes on the screens from last week. Let's hope this week treats us better than last week did. Weeks with a holiday are usually crummy.

After a three years of hemming and hawing (is that how you write that?), I purchased a subscription to Zack's Research Wizard today. I've been testing it for the past couple of weeks, and I've really discovered some time-saving ways to evaluate my screens and ideas. I used to go through reams of information (I have a stack of paper two feet tall) to get certain types of historical data. I found ways to get that same information in a few seconds.

The subscription price is $1,600 and that provides 6 years of historical data. I've talked with a lot of folks that nearly drop dead when they hear a price like that but I spent nearly that amount on my dumb '99 Plymouth Voyager yesterday and there is no way that thing is going to make me any money.

I've met a few traders out there who hurt their returns because they are too wrapped up in nickels and dimes. They are afraid to exit a $20,000 losing position because of a $7 commission. They spend all their time looking for free information when they could be making a lot more paying somebody else to do the leg-work for them.

I think there is a lot of fear out there because of shysters who have taken people for all they are worth. I'm sure that hurts the businesses of reputable companies that want to help people make money. My experience with Zacks over the years has been very positive.

I figure this is money well-spent. I'll let you know how things go throughout this next year. I hope to develop some new screens and after the summer, I'll be sharing those screens (and some of my older ones) with StockPunk readers.