2.  When I click on the product links on the left hand side of the page I find pages and pages of discussion.  Why are these sections so long?

The short product descriptions can be found by clicking on the blue links in the middle section of the Home Page.  The "Products" link on the navigation bar is another way to get there.  Most people will find all the information they need at these locations.  On the other hand, some of our more technically minded visitors want much more information.  In fact, the quantity that would satisfy them would probably put most people to sleep.  Most Web sites do not offer nearly enough information to satisfy this kind of visitor.  We made a real effort when designing our Web site to satisfy both types of visitor by offering them a choice.  They can opt for mind-numbing quantities of information or they can opt for a briefer description consisting of a little less than a page.  Visitors can decide for themselves when they have enough information. 

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3.  Why does the Valuator cost as much as the weekly StockAlerts?

The production of The Valuator is much more labor-intensive.  It is packed with information--some of which is not available anywhere else on the planet.  The real question is "How can The Valuator be as inexpensive as StockAlerts?"  Perhaps an even better question is how they can both be so much less expensive than the average 10-page monthly newsletter.  By posting them on our Web site, we do not have to pay for paper, ink, postage, or envelopes. It also takes time and labor to print and assemble paper publications.  Aside from that, we do not try to get the highest price we could get nor do we try to get the "average going rate."  We want people to think "Wow, what a bargain!"   

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The real problem we face is cheating or stealing.  We base our whole operation on trust.  We can’t afford to get beat up in the market place because our customers send free copies of our products to friends.  If people are not honest with us, we will either have to go out of business or significantly increase our prices.  Some people think that because they send a copy of our product to only one friend, it cannot make much difference, but it does.  Every paying customer counts, especially since our company is not a huge conglomerate.  We are a small but dedicated operation.  We have been producing The Valuator in hard copy for over 18 years.  Even though we are small, we are not fly-by-night.  You might call the electronic provision of our products an experiment.  It enables us to be more efficient and to pass significant savings on to our customers.  However, we must adapt to survive.  We do not want to limit the availability of our publications to printed versions only, but we will if we cannot trust our customers to honor our copyrights.  That would mean customers would no longer be able to use a spreadsheet to sort stocks.  If we have to print on paper, our delivery will be slower, and our prices might be more than double what they are now.  Instead of sending free copies to a friend, why not tell the friend how useful the product is and recommend it?  That’s the way the system is supposed to work.  (Please read #s 5 & 6)

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5.  Why do you require customers to promise they will not forward or otherwise send your products to another person?  Won’t they do it anyway?

We believe that people are essentially honest and that most cheating occurs when people do not really think about what they are doing.  They do not think of the fact that they are stealing something that is ours in order to give it to a friend.  Only the customer has a right to use our product.  The customer does not own the copyright.  The copy they send to a friend is a stolen copy.  Sending a copy to a friend is similar to going to a magazine rack, paying for a copy of Newsweek or Money, and stealing an extra copy to give to a neighbor.  The requirement is intended to focus their attention on the issue and to cause them to commit to being honest with us. Actually writing their name to the promise and sending it to us will mean something to honest people.  To see our "Notice" about this, click on NOTICE.    This link will provide additional information.  (Please read #6 also)

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6.  So why do you ask people to e-mail you their promise before they order? 

If a person orders a product, the product will not be delivered until the promise is received by us.  If the customer refuses to send the promise after paying for the order, we will have to give a refund.  If the individual has paid by credit card and we are asked to process the refund through the credit card company, we must charge the customer for any processing fees charged to us.  The company that we have contracted to process our Web site fee transactions charges extra to process a refund, and the credit card company itself will charge a fee.  Therefore, to avoid unnecessary aggravation and expense for the customer, we ask that the promise be sent before the order is placed.  If an individual is not going to send us the promise, we might as well find out beforehand so we can avoid having to pass those expenses along to the customer.  If we can pay the refund by check, however, there will not be any "processing fees."  In that event, the amount refunded will be the amount paid by the customer minus the amount we were charged by the customer's credit card company when the original payment was made.

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7.  Why do StockAlerts and The Valuator have such different issuing rates?

They were both originally conceived as monthly publications.  However, it soon became apparent that the signals generated for the large number of stocks in StockAlerts would be of interest to very short-term traders as well.  Short-term swing traders and day-traders need a constant supply of stocks that are ready to move at any given time.  The Valuator is a research tool that goes far beyond merely finding a stock that is likely to surge.  It gives information about fundamentals that can fuel a long trend, and so on.  Since the moves that shorter-term traders are looking for are not very extended, fundamentals are not quite as important as they are for other investors (however, that does not mean they are unimportant).  It is more critical for them that they scan a much larger universe so they can always have a collection of stocks that are ready for action at any given time.  Unlike The Valuator, StockAlerts does not provide any information on the fundamentals of a company.  As the holding period increases, fundamentals become increasingly important.  That makes The Valuator a very useful screening tool for short-term, intermediate-term, and long-term investors. We decided that The Valuator could, at a reasonable price, meet these needs and that monthly publication would serve the purpose nicely.  Because StockAlerts is not as labor intensive as The Valuator, we can publish it more frequently and cover more stocks at a similar price.  The two publications have an overlapping constituency, but they address somewhat different needs.  They both can serve some of the needs of long-term investors (who will want a stock that triggers an alert in StockAlerts because it is ready to move, and that also satisfies elements of their discipline derived through reference to The Valuator) and short-term traders (who want stocks that are ready for action that they locate through StockAlerts but are smart enough not to ignore the fundamentals and other information available in The Valuator). 

^.

Because of the labor involved we have decided, at least for now, to keep The Valuator limited to about 500 stocks.  However, we will listen to any ideas for adding new stocks to the list covered by StockAlerts.  We will give serious consideration to any stock you suggest that trades at least 100,000 shares a day, is priced above $10, and trades on a major American exchange.  We might even give some consideration to a $7 stock if it trades at least 150,000 shares a day.  Then again, we might not.  Think about it.  A stock that trades 100,000 shares a day at $5 is actually trading only about $500,000 a day.  Traders all over the world are scanning stocks for various buy signals.  When there are so few shares traded, competition for those shares at a good price is extremely tough.  That means your trading efficiency will go way down.  You will tend to buy at too high a price and sell for too little.  You need liquidity to get in and out at a good price and to execute trades efficiently.

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9.  Why use Stops?  Don’t some charting programs also generate stop-losses?

Some can, but not at anywhere near the price nor are they nearly as easy to use.  Also, some do not use the right formula for computing a standard deviation.  There are two basic formulas, and they have different statistical uses.  However, one major charting program we know about (priced at more than $1000) uses the wrong equation for this purpose.  This error will tend to place the stop too close because it assumes the data measured is all the data rather than a sample of the data.  Measuring stock price data over any time period is measuring only a sample of of the data that could be measured.  Measuring the tallest man in a room of 30 men does not tell you how tall the tallest man in the city is. In the same way, the largest price spike of a stock over a period of 20 days does not define the largest probable price spike.  There is a specific formula that should be used to draw inferences about probable price spikes based on a sample of pricing data.  Another problem with using charting programs to plot your stops is that every such program we know about requires that its users learn how to use the syntax of the program and how to write the needed equations correctly.  With Stops, all you have to do is enter price and date information.  You do not have to know how to write statistical equations or figure out program syntax.

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10.  Why did you stop managing accounts?

We will spend some time on this one because new traders and investors might learn something from reading about our attempt to use a high-performance discipline with client accounts, the different performance targets, why a high-performance discipline was not practical, the need for a strict adherence to the rules of a discipline, the tradeoffs required, and why we finally decided to leave the advisory business. 

We decided that taking this step was necessary to release the full power and profitability of the Disciplined Growth Strategy (our high-return trading discipline) for the personal accounts of company members.  Managing the accounts of others for a fee (but not using the discipline for our personal accounts) was less attractive financially than giving up the fees and fully implementing the discipline for our personal accounts.  However, there was much more that went into the decision than this.  Let's look at some of the factors that were involved.

Because the high-performance discipline required our undivided attention, we could not use the discipline in our own accounts while using other strategies for clients.  The account management process, the regulatory paperwork, the wide range of investment needs of our clients, and their widely divergent attitudes about "appropriate holding periods" all placed too many constraints on the trade-decision process.  To do it right, all accounts would have to make the same trades at the same time. 

However, we could not get all our clients to consent to a strict adherence to the discipline.  Although a few clients were ready to implement the discipline, others complained or were prone to confusion whenever trade activity levels increased.  Some even seemed to want to "buy and hold" without implementing any selling discipline at all.  For example, if our algorithms issued a sell signal and we sold a declining stock quickly with only a small loss, some clients became upset and called to advise us (in no uncertain terms) that we should have given the stock more "breathing room."  We concluded from these and other comments that clients would prefer that we "rode" a stock up and down like a roller coaster through several cycles before even thinking about selling.  They would also prefer that we ignore our algorithms when they indicate that a small decline had a very high probability of growing into a larger loss.  Experienced traders know that this attitude has no place in the execution of any high-performance investment discipline.  We could not trade as freely for our clients as the discipline required.  Furthermore, because we needed to manage the personal accounts of members in the same way as we managed client accounts, our members could not come close to achieving for their own accounts the growth potential of a strict adherence to the discipline.   

We even considered the possibility of continuing with only those clients who were fully committed to achieving high performance and who did not care what level of trading activity it required to get there.  The problem with that idea was that the number of candidates was small (most of our clients were retired or nearing retirement) and the risk we would assume was too great relative to the fees we could charge.  If one person became confused because of the trading activity, or if we had a temporary slump that frightened somebody to the point that they contacted the SEC or other regulatory authorities with a complaint, then we would have to take time and energy from our enterprise to explain or defend our methodologies to regulators who are committed to the conventional wisdom that one should buy and hold stocks through their ups and downs and eventually sell them when they are higher.  [While this approach might work sometimes for people who do not have the disciplines and tools to be effective traders, it will not enable a person to achieve returns averaging well over 40% a year.]   

We have a discipline that has generated about 20% a year for 15 years.  This strategy is designed for intermediate-term investors in utility stocks.  We have another slightly stronger discipline that has averaged about 26% a year and that buys any kind of stock.  Let’s refer to these disciplines as "20% systems" (reflecting their targeted level of performance).  However, the discipline we wanted to use for client accounts (the Disciplined Growth Strategy) was far stronger than either of these "20% systems," but it required a more active and disciplined approach to trading.  If a person makes a half-hearted attempt to use the Disciplined Growth Strategy (if a person does not sell immediately when the model says it’s time to sell, and so on), performance will suffer.  Under those conditions, the performance of the Disciplined Growth Strategy will not be as good as that of our "20% systems." 

An analogy might help you to wrap your mind around the problem.  Assume that the cylinders in the engine of a racing car are similar to the rules of an investment discipline.  Optimum performance of a racing car can not be achieved unless all cylinders are firing correctly.  In the same way, optimum performance cannot be achieved with a high-performance trading discipline unless there is strict adherence to the rules of the discipline.  A high-performance racing car will not perform as well as the average family car if you disconnect the spark plug wires to four of the eight cylinders in its engine.  In the same way, following only a few rules of a high-performance investment discipline will result in relatively poor performance.  Performance will tend to be inferior to that of the 20% systems.  The interdependent rules that comprise a high-performance discipline also function as a kind of glue that gives the discipline its integrity.  Ignoring some of the discipline's rules will weaken or even destroy the discipline's integrity.  In other words, "things will fall apart."  The unwillingness of a significant number of clients to follow the rules of the Disciplined Growth Strategy left us in a quandary.  We either had to give up any hope of using the Disciplined Growth Strategy for client accounts and return to the use of more conventional investment disciplines, or we had to quit managing accounts and use the much more powerful discipline for our own accounts.  There was another factor at work. 

Wendy Felt had been testing the Disciplined Growth Strategy in her own account with real money for about 5 years.  [Wendy is the daughter of Winton Felt, and co-editor of The Valuator.  She is also a trader.]  Wendy was having fun with her trading.  Also, her trading activities convinced us that consistent returns above 40% were realistic goals when using our trading discipline (even without the use of margin, short-selling, options, or commodities).  Wendy had been preparing to take over parts of our portfolio management business and planned to use the discipline that she had been using for her own account to manage the accounts of her clients.  However, when she saw the reluctance of clients to implement the rules of the Disciplined Growth Strategy, and concluded that their attitudes could also result in problems with securities regulators, she realized she would have to use a much less powerful discipline in managing client accounts.  That would also interfere with her use of the Disciplined Growth Strategy for her own account.  She weighed the burdens and problems of managing money for others to get a 20% return against the freedom she would have from client and regulatory difficulties while trading her own account without restraints and with targeted returns well over 40%.  She decided to choose the latter.  Winton Felt reached similar conclusions from a different perspective.  He decided that working together with Wendy and being able to use the Disciplined Growth Strategy without opposition from clients or any other constraints would not only be more enjoyable but also more profitable.  He decided that working closely with his daughter in a profitable enterprise of mutual interest in which they could stimulate and encourage each other in creative ways was a very attractive alternative to the constraints, burdens, regulatory overhead, and limitations on performance that are part of the investment advisory business.  Simply put, he wanted to have fun playing with his daughter.   

Now let's look at it from a strictly business perspective.  Managing accounts to achieve a return of 20% while collecting a management fee was not as attractive financially to our members as taking the firm out of the portfolio management business, fully implementing the discipline for member accounts, and targeting returns 3 times as great.  That kind of performance does not come easily, and it seemed a shame not to make use of knowledge that took so many years of research and testing to acquire.  We doubt very much that there are many investment advisors who have the ability to achieve that level of performance.  If they did, it seems they could do much better for themselves by simply trading their own accounts.  Why would they work for a fee and put up with all the regulatory hassles?  On the other hand, we know of some traders who consistently achieve these higher performance levels when managing their own money.  We have studied, conducted research, and tested trading systems for many years.  At one point we dedicated at least 8 hours a day (for 3 of those years) to designing and/or testing the profitability of many thousands of disciplines.  We satisfied ourselves (with real trading in a real account) that the Disciplined Growth Strategy can do what it was created to do.  We wanted to share what we learned with clients by employing the discipline in the management of their accounts to achieve performance rarely seen by investors.  We just could not get the level of client consent we needed to implement the discipline effectively. 

Once we came to the conclusion that the goal of implementing the discipline for a large number of clients with widely divergent attitudes about investing was not practical, we decided that the best way we could put all that work and knowledge to good use would be to let our members implement the discipline for their own accounts.  We understood the discipline well enough to fully trust it.  The trading activities of members could then be used as resource material for the teaching and training activities of the company.  Our products flow naturally out of our own trading needs.  Even if nobody subscribed to them, we would still have to produce The Valuator and StockAlerts for our own purposes.  We make extensive use of them in our own investing and trading.  That is the real reason they exist, not because we can market them to others.  However, we decided that since we produce them anyway, we might as well make them available to subscribers.  Thus our own need for these resources has resulted in the availability of tools that can benefit others.  Our visitors, subscribers, and licensees can therefore benefit from our experiences and information while trading as conservatively or as aggressively as they desire.  The members of our company, on the other hand, can benefit from being able to fully implement our disciplines for their own accounts.    

Thus, we finally came to the conclusion that life would be simpler and there would be fewer headaches and less stress for our members if the company focused on providing resources for investor enablement and stopped managing accounts.  Accordingly, "enablement" has now become the focus of Stock Disciplines, LLC.  The firm now gives no investment advice.  We never make stock recommendations.  We simply try to enable others to do a better job for themselves.  Therefore, we no longer have to indulge securities regulators who are constantly demanding more paperwork (at the time of our withdrawal from the advisory business securities regulators required that each advisory firm have at least one employee whose full-time responsibility is to keep the firm compliant with all the regulations).  

On the personal level, the trading of our members is now their own business and they can do it without clients telling them how to manage their portfolios.  Many clients simply could not grasp the idea that taking losses quickly when they are still small is an essential requirement for rapid account growth.  Changing our company's focus gave us a win-win business model.  Our customers and visitors can benefit from the use of our tools and information.  Our members get to trade the discipline correctly and without interference from clients.  Everybody benefits from this arangement.

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11.  How do you teach?

Visitors learn by poking around this site.  Each section has information.  Some ideas conveyed in "Market Review" transfer to individual stocks.  For example, most of the indicators can be applied to stocks.  Learning how to read them for the market is transferable knowledge.  An example of how to use R.C. Allen's system is on the same page.  The procedures and rules used here apply to all triple moving average systems.  We illustrate the procedures with the Dow but this is knowledge that is transferable to individual stocks.  We also use tutorials to teach.  Please bear in mind that this site is new.  We think of the 25 or so tutorials listed at the time of this writing as only the beginning.  We expect to have many more tutorials posted over time.  Studying and thinking about what is said in the tutorials can be extremely useful.  For example, our discussion of the CCI is, in our opinion, one of the best available.  Other sites may display the CCI, but most don't say much about how to use it.  Some of our tutorials emphasize the thinking process.  The particular stock used to illustrate a concept is not really important.  It's the process of analysis used in approaching a situation that is important. 

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12.  What is a simple way to place a shortcut to your Web site on my desktop?

Look at our URL in your browser.  Notice that just to the left of our URL is a small picture.  In Internet Explorer it is usually an 'e' but it may be some other picture.  Click on this small image and drag it to your desktop.  This creates a shortcut to our Web site on your desktop.  

If you cannot see your desktop, your screen image is probably maximized.  In the top right-hand corner, you will probably see .  Click on the overlapping squares in the center.  A single square will now appear.  Move your cursor to the right edge of your screen.  It will change to an arrow.  Press your mouse button and drag the edge of your screen image to the left.  Your desktop should become visible.  If not, repeat the process on the screen image that has become visible.  Eventually, you'll get to your desktop.  Once you can see your desktop, click on the image at the bottom of your screen that represents our Web site.  Now you can perform the procedure described in the first paragraph.  The top right-hand corner of your screen image has been changed to .  If you want to maximize it again, click on the square.

Another way for Windows users is to click with your right mouse button on the desktop and select "New" then "Shortcut."  In the window that appears type "http://www.stockdisciplines.com" without the quotes and click "Next."  Type a name for the shortcut in the window.  For example, you could simply type the word "Stocks" (without the quotes) and then click on "Finish." 

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13.  Why do you have California time posted on the "Market Review" page?

The two charts below the time have New York time embedded in them (the location of the New York Stock Exchange).  We are located primarily on the West Coast.  For us, the market closes at 1 p.m.  We often, if not usually, complete our updates by about 4:30 in the afternoon West Coast time (sometimes a little sooner and sometimes a little later).  However, unforeseen circumstances may interfere with our achieving that goal.  The "clock" gives a reference for people in Europe, Asia, and in other time zones.  We use US Naval Observatory Master Clock time because we want accuracy.  We thought that providing a clock accurate enough that people could use it to set their own clocks and watches would be a nice amenity for our visitors.