Fool.com: Monthly Model Update- RS-IBD (Workshop) February 8, 1999

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Monthly Model Update- RS-IBD

Burlington, VT (Feb. 8, 1999) -- On the Monday following the first Friday of each month, tune in here to get the latest on a monthly traded Workshop model -- either the Unemotional Growth model or (reinstated for 1999) the Relative Strength-Investor's Business Daily screen.

First, with the honors for the month, the RS-IBD screen. I'll fill you in on Unemotional Growth's performance on Thursday. (You can always get the latest screen choices at the Workshop Rankings page.) In my January 4, 1999 Workshop column, the IBD-RS picks for the month of January were laid out. Here's how the ponies ran over the last five weeks:

Yahoo! Inc. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: YHOO)") else Response.Write("(Nasdaq: YHOO)") end if %>        45.82%
America Online <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: AOL)") else Response.Write("(NYSE: AOL)") end if %>         5.72%
Dycom Inds. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: DY)") else Response.Write("(NYSE: DY)") end if %>            -3.08%
EMC Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: EMC)") else Response.Write("(NYSE: EMC)") end if %>             14.71%
Nokia Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: NOK.A)") else Response.Write("(NYSE: NOK.A)") end if %>          8.25%
Solectron Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: SLR)") else Response.Write("(NYSE: SLR)") end if %>      -17.28%
Schwab (Charles) <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: SCH)") else Response.Write("(NYSE: SCH)") end if %>      17.58%
VISX  Inc. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: VISX)") else Response.Write("(Nasdaq: VISX)") end if %>         35.38%                 
AnnTaylor Stores <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: ANN)") else Response.Write("(NYSE: ANN)") end if %>      -5.07%
Amer. Eagle Outf. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: AEOS)") else Response.Write("(Nasdaq: AEOS)") end if %>  -1.50%
                    RS-IBD 5      14.28%
                    RS-IBD 10     10.05%
Standard & Poor's 500 Index        0.83%

Seems like the RS-IBD is off to another hot start. This screen has been cooking of late.

It may be your bag to view it as a "non-factor in selecting companies for investment," like fellow Fool Dale Wettlaufer mentions in his Fool on the Hill column. Personally, I'll keep it in the top tray of my toolbox, since it had everything to do with my decisions to buy great stocks like Dell Computer and America Online. It's also helped me stay unemotional when selling a stock or two before a total crash and burn. Sure, it's not the perfect buy and sell indicator -- nothing is -- but ignoring it lately may have had you playing catch-up to investors who reach for the RS calipers often. The beauty of Fooldom is the diversity of approaches we follow toward the common goal of market-beating investment returns.

Looking at the latest Value Line and Investor's Business Daily, you can get the screen's current picks. The method is this: Start with all the stocks listed by Value Line as having a Timeliness rank of 1 (100 stocks), look up each stock's "Relative Strength" ranking in the Investor's Business Daily, and sort the Timely #1 stocks by IBD-RS rank from highest to lowest. The top 5 and 10 stocks are the screens we track. Here they are as of last Friday:

Yahoo! Inc. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: YHOO)") else Response.Write("(Nasdaq: YHOO)") end if %>
America Online <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: AOL)") else Response.Write("(NYSE: AOL)") end if %>
Schwab (Charles) <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: SCH)") else Response.Write("(NYSE: SCH)") end if %>
VISX Inc. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: VISX)") else Response.Write("(Nasdaq: VISX)") end if %>
Dell Computer <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: DELL)") else Response.Write("(Nasdaq: DELL)") end if %>
MiniMed Inc. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: MNMD)") else Response.Write("(Nasdaq: MNMD)") end if %>
Oracle Corp. <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: ORCL)") else Response.Write("(Nasdaq: ORCL)") end if %>
Sun Microsystems <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: SUNW)") else Response.Write("(Nasdaq: SUNW)") end if %>
Amer. Eagle Outfitters <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: AEOS)") else Response.Write("(Nasdaq: AEOS)") end if %>
Best Buy Co. <% if gsSubBrand = "aolsnapshot" then Response.Write("(NYSE: BBY)") else Response.Write("(NYSE: BBY)") end if %>

Remember, Fools, this screen comes with the usual disclaimers about not investing in a screen or company blindly. Before plunking down money, make sure you are comfortable with the high volatility that these stocks have shown in the past and remember that the list is generated totally mechanically. Its appearance on the list doesn't mean a company is a good investment. Sometimes companies on the list have been very bad investments. Being on this list simply shows that the stock has done great in the recent past and the folks at Value Line think it has some potential left. Do your homework.

There is a season for every purpose under Fooldom!

Check out the latest file updates for the Workshop:
New Rankings | Workshop Returns