A.I.M. Users Bulletin Board

[Adam]

Hi Steve, OK so the ETF boon has put money into "good" and "bad" stocks. To me all that means is it will lower the gap between the good and bad stocks.

There is still the Holy Grail search for the "good" stock out of the bad. Let's say you have the skill to find the good stock. Say you decide a stock like INTC is undervalued, then what. It will remain undervalued until some big institutions are convinced to start buying large amount of that stock. In the case of INTC it's a stock that's already highly owned so it's hard to move. I think for the individual trying to find undervalued stocks is very difficult-- one could very well end up with dead basket of stocks waiting to move up. And of course you could make some mistakes, so some of your "good" stocks will turn out to be turkeys.

Probably a better strategy for the stock picker is to ride a momentum wave on already discoverd stock, with stop loss. It's a method out of the scope of AIM.

Adam