Book Score: 5/10
As an amateur, there are several useful concepts that this
book has offered me. Concepts such as how he evaluated each stage of a stock’s
growth and the detailed criteria provided to identify each stage is certainly
valuable. Next, his VCP technique is also a key useful takeaway from the book.
From his information, I am able to roughly identify basing patterns and
understand what it might possibly mean when I encountered this trend in a
chart. Combined with his staging criteria, this technique will be helpful in
identifying potential stocks to keep a lookout for.
With regards to his SEPA technique, though it is useful to
state the criteria that he considers, the information provided here is rather
lacking. This is especially so when this is a key step in identifying the
correct stock to keep a lookout for. Without this, I find it very hard during
my practice to verify that the stock I had pick out is the correct one (by
applying his staging and VCP technique). Therefore, I find it rather difficult for
a thorough application of his method. As for the monitoring of EPS, while I
find it informative, it would be better if he could explain in detail how the
EPS growth is calculated. I attempted to calculate some of them, and my values
certainly do not match his (and I am certain that I am doing it wrongly). It
would be good if he could provide more guidance to where important values could
be obtained from (like EPS, and many other financial numbers from his SEPA
ranking process).
Information provided in the book often is repetitive and all
over the place, even across chapters. Hence for quite a substantial amount of
time while reading, I do not find myself satisfied with the knowledge that the
book has to offer. There are certain key points that I disagree upon as well,
probably due to my prior education received in the field. Most of these are
regarding the last 2 chapters of risk management. For example, I feel that he did
not give a clear distinction between investors and traders. I feel that his method
outlined in his book would be more suitable of trading. As an investor, I disagree
that one should not average down, and that there is no such thing as a safe
stock, because these are the things that I do. As a trader, I disagree to split
my trades into 3 portions (like the “professionals” do) because this will badly
intervene with my R:R ratio and disrupt the time frame at which I will be
trading at. This brings me onto the next point: while he cherry picked all his
examples, he only highlighted where he bought. It will be better education if
he could showcase when he exits and what kind of a timeframe/R:R in mind. From reading
his book I find that the trading timeframe could be rather long (several months
to years) which will be more suited to investing rather than trading, yet he
applies risk management of a trading viewpoint (in my opinion). When I looked
back at some of his examples, some of them crashed badly after the point where
he signalled the big percentage gains. Without knowledge of his exit strategies,
I find his strategy dubious at times.
Lastly, while inspiring, I find a certain portion of his
book to be boastful of his achievements, which I find it most unnecessary and makes
me want to roll eyes at time.
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