Stockbee IBD 200 Update

It's time for another Stockbee IBD 200 update. The first stock purchased using his strategy was Open Table Inc. (NASDAQ: OPEN). I've been simulating this test in my stock simulator to see how the strategy pans out. I read his post about how to trade the IBD 200 and decided to test it out. As a side note, I wanted to talk about testing investment strategies. One of the things I noticed about Stockbee's post about the IBD 200 was how simple it was. Because it was so simple, most people loved an idea that required so little effort. But what was missing in the comments as far as I was concerned was that no one commented about how well the strategy worked for them. Stockbee does say that people who did implement it though did make money as well as comment on how not many really put it into practice.

Because of that, I thought that his claim that it's a good way to select stocks needed some proof that it actually did work as advertised instead of taking it at face value. You can read more in my article called Stockbee's IBD 200 Market Update: NASDAQ: OPEN.

So, back on July 12, I bought 22 shares of OPEN in my stock simulator for $44.95. Today, the stock closed at $48.89 which is up 8.77% since that date. Today was a great day for the stock as alot of the gain was today on heavy volume. This is another good sign. The stock was highlighted in the IBD the other day in the Stocks in the News column as well.

Which brings me to one thing I wanted to make sure that I pointed today and that was that on July 30, Forbes analysts downgraded the stock. If you have read any of my articles, then I think you know that I think that downgrade was on purpose to shake people out of the stock. While it remains to be seen if their analysis is on the money, the big money didn't think so because volume was way above average today. I'm hoping for a 20% gain before I close out the position unless it reaches that point in 8 weeks or less. Then I will want to hold onto it.

This is an example of stock market investing today where you want to do what they do and not what they say. Watch the media very carefully because they may not be on your side. This may be the case here as well.

So far so good, I'll have another Stockbee 200 update soon.