Finding Value In Heavy Volume

Since Jon Petak started sitting on the desk a few weeks ago we have been talking a lot about esoteric stocks and if you regularly listen to the broadcast I’m sure you have heard your share of names being tossed around.  When I say esoteric I’m talking about stocks that are breaking up or down on heavy volume.  We have been trading the names small for the last few weeks but we haven’t been trading them with the success we should have becasue were not taking all of the trades. 

In my opinion when your trading a signal you have to trade every signal or your results will be flawed and you will never get a true feel for the success or faliure of your system.  So on Friday I set up a basket of all of the esoteric names we identified Thursday to see how our strategy would have worked if we took every trade with a notional value of $5,000 per name. 

The results are as follows:  Thursday we identified 28 names that fit our criteria.  We took the trades MOC (market on close) so we got filled at the closing price that day.  

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