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| Author: Mike Celeste | Editor: Tony Ponzo | July Circulation: 13012 |
STAT SHEET WEEK ENDING July 30 / 05
2005 Month of July Percent Points
Dow July Change + 3.6 % + 366
S&P July Change + 3.6 % + 43
Nas July Change + 6.2 % + 128
SplitMaster July
Basic + 5.7 %
Big Dipper + 6.6 %
Option Calls + 71 %
Option Puts + 75 %
Week ending 7/30 Percent Points
Dow Weekly Change - 0.1 % - 10
S&P Weekly Change + 0. % + 0
Nas Weekly Change + 0.2 % + 5
Comments:
July turned out to be hot not only in the weather around the country. All the markets had a very good month. You can see by the figures above that the summer doldrums didn't turn up in the stock market. Now the question is whether it can continue for the rest of the summer. Earnings have been very good, but when they weren't, individual stocks were punished pretty severely. The week did end up on a down note, but that one day couldn't damper the enthusiasm that has built up over this month. CNBC mentioned that the hedge funds, with all their exotic trading tools, might have taken some profits off the table to have the figures for the month look good. I can't argue with that because I don't have their figures on hand, but it sounds logical. Nas led the way with an excellent month, showing a gain of 6.2%. I had to check my figures twice to see if that was correct, and it was. That is the only index that was able to beat any of our SplitMaster systems, edging out only our Basic System, while still losing to the Big Dipper and our Option calls and puts.
July is typically a slow month for splits and this year was no different---but---hold on to your hats, because we have 10 new splitters coming--so far--as opening plays in August. That means up to 20 call/put plays. Those of you that have been wanting more action are certainly going to get it. Even so, July had 14 Option plays and 5 Basic splitters close out. Looking at the option results above, it is hard to ignore those numbers. The calls and puts were almost even in results, with a great +71% profit return on the calls and +75% profit on the puts. Also, we must keep in mind that the puts have a maximum return potential of 100% on each individual pick, since we are writing/selling them and can only make as much as we sell them for. The other beautiful part about selling puts is that no cash has to be put up as long as there is enough asset total in a margin account. The loss risk is greater than buying a call, but if we are correct when we say that stock splitters do well over the course of a year, we are going to see a net profit in those puts. We can't guarantee the future, but we're thinking that history is going to repeat itself, as it has done for the last 30 years.
Now I'm going to brag. Not about me and not about SplitMaster, but about my 16 year old student that I have been mentoring. Jonathon had his father open an account and set a goal of making $10,000 over the course of this summer, using our system, including options. I'm very pleased to hear him tell me that he has already reached his goal---and his starting investment was very reasonable. He comes to my house, and we sit around, throwing questions at each other. I hardly ever answer questions, by the way, but answer his question with another question, especially when I know that he has the knowledge to answer. In other words, he has to think when he is with me. He doesn't know it all yet (and who does, including me), but he has advanced so fast I have a hard time believing it myself. This was a good test for me, too. My goal was to see if I had the ability to transfer stock and option knowledge in a one-on-one, in-person situation. So far, both of us are passing the test. Keep up the excellent work, Jonathon. Oh, he would have had even better results, but something called high school finals got in the way and he couldn't execute all the plays that he wanted to. That's ok--he did very well in both the school results and in the system plays. I mention this also to show that just about anyone can understand and use our systems to their advantage, based on their own personal goals.
There is another favorite team member that I mention from time to time, because he is in frequent contact with us, making suggestions, asking questions, and telling about his stock experiences. I have to say that I am a bit jealous about Bernie. His last correspondence stated he was taking an early profit in SUN, as he was comfortable with the gain he had, and that he would see me on the links. Sure, see me on the links---not. Here we are, slaving over data analysis, looking for improvements in our systems and trying out new ones, and Bernie is out on the links. He said before, that because our systems are so simple to use, with 2 days advance notice of what to buy on the open, etc., he just puts his order in and goes play golf. Now don't get me wrong. I'm very happy for Bernie, because that's the way we designed our systems---simple and easy to execute.
Naturally we want our team members to be successful. I'm sure you can understand that hearing from members is tremendously satisfying---I guess it is the old teacher in me. Whenever I hear the words "Oh, now I see what you mean" and knowing the light bulb went off, gives me the feeling that everything was worth the time in trying to educate someone. At the same time, we keep repeating that we educate, but it is most important that a person feels comfortable in their investment program.
Don't forget to check out all the info, free and fee, members and non-members at www.splitmaster.com. Also, comments, questions and suggestions are always welcome.
Today's Thought---
Losers visualize the penalties of failure. Winners visualize the rewards of success......Rob Gilbert, via member, Marilyn.
Mike Celeste
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