Page 824 - How to Make Money in Stocks Trilogy

Breaking Boards: Successful Trades and Lessons Learned 97

You must be ready to take advantage of leading stocks as they are breaking
out, and the overall market is acting strong.” Debra started her journey of
being a full-time investor.
She logged gains of:

Tractor Supply. 23% in 11 weeks
Apple. 33% in 13 weeks
MasterCard. 21% in 11 weeks

• KEY POINTS •

• Do a post analysis of trades, and find ways to improve.
• Always be ready for a new uptrend so you can capitalize on
stocks that break out as a result.

Learning to Capture the Big Winners
Jeff Heimstaedt was in his senior year at Pepperdine University in Malibu
when a fraternity brother invited him to his parent’s home for dinner. Jeff
met a successful stock broker at the dinner who described the stock market
as a great place for someone young to make money, if they were willing to
work hard. The financial possibilities and the intellectual challenge
appealed to Jeff, so shortly after college, he got a job with Merrill Lynch.
He became aware of IBD through a co-worker and read How to Make
Money in Stocks, which introduced him to a fact-based investing system that
made sense. Jeff said as well as reading the paper on a regular basis, he
started subscribing to Daily Graphs (now MarketSmith) and would pick the
chart book up at noon every Saturday as a way to find companies that were
setting up in base patterns. “At the time,” he said, “there was no Internet, and
very few charting services were around, so Daily Graphs was extraordinary.”
From 1998 to 1999, Jeff was buying a lot of the “hot” tech stocks like
Yahoo as they broke out of price consolidations. His overall strategy was to
buy stocks at the pivot, but if the trade went against him more than a point
or two, he would sell them.
From January 1998 until February 2000, a period of 26 months, Jeff’s
account increased over 750%.