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IGVSI Bargain Stocks - Are There Any Left? |
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Submitted by Steve Selengut
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The IGVSI Bargain Stock Monitor clearly reflects the strength of this ten-month-rallying stock market. In fact, the bargain monitor is sporting the best numbers ever recorded. No, this is not a "buy" signal.
The numbers are telling you that most Investment Grade Value Stocks are at or approaching their highest valuations of the past 52 weeks. Market Cycle Investment Management (MCIM) Program portfolios are approaching the all time high profit levels achieved in 2007, and only a handful of IGVSI equities are at "bargain" price levels--- i.e., down 20% or more from their 52-week highs.
Additionally, the most conservative MCIM portfolios have been achieving new all time highs regularly, for the past three or four months--- this because managed income closed end funds rose about 31% in market value during 2009.
So, with the very best numbers we've seen in two and a half years, why aren't you taking profits and positioning yourself to take advantage of the next market correction instead of (as usual) being victimized by it?
The Bargain Stock Monitor is reporting that a 52-week high has been achieved in Investment Grade Value Stock market values, but it is predicting nothing. What matters now is what you do with the paper profits that the past ten months' rally should certainly have provided for you.
If you have not taken profits, one or more of these things is happening:
* You are being greedy by ignoring Working Capital Model (WCM) profit taking guidelines.
* You do not have profit taking opportunities because you fearfully failed to take advantage of hysterically lower prices over the past two years.
* You don't have profit positions yet because you were unable to add to your portfolio significantly when prices were lower
* You don't want to be burdened with short-term capital gains.
* You think that this rally will last forever.
Yes, we are still in a rally, and the longer that we experience slow improvement in the more widely worshipped numbers, the less likely it is that the next correction will be as devastating as the last. But there absolutely will be another correction, and
There is no such thing as a bad profit!
For your information, the Bargain Stock Monitor is one of three market statistics used as performance expectation analyzers in Market Cycle Investment Management portfolios.
A "WCM friendly" watchlist program identifies specific IGVSI companies trading at least 20% below the 52-week high water mark, and that also meet the price selection criteria outlined in The Brainwashing of the American Investor: The Book that Wall Street does not want YOU to read.
The fewer IGVSI stocks at bargain prices, the stronger the market and the more "smart cash" that should be building up in investment portfolios. As the list of bargain stocks grows, portfolio smart cash should be finding its way back into undervalued securities.
The other numbers used for MCIM portfolio performance evaluation are: The Investment Grade Value Stock Index itself (The IGVSI), IGVSI Issue Breadth, and new 52-week High vs. new 52-week Low numbers.
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