Profitable investing demands a unique type of profitable thinking. Once you’ve achieved this consistently in your thinking and investing, you are ready to move on to focusing on
how best to nudge the probabilities in your favor with respect to all elements of your methodology. Specifically, the example I’ll use in this instance is William O’Neil’s CANSLIM methodology that is so widely used.
I’d like to thank my friend Tom McClellan (of McClellan Oscillator fame) for bringing together two CANSLIM experts and traders for an enlightening evening last week. My first exposure to William O’Neil and his methodology was in graduate school, just as he was starting the Investors Business Daily newspaper. Back then, he came across as an almost shy but clearly brilliant investor when he spoke to our class about his trading methodology.
When I began trading full-time, my methodology was heavily influenced by his books, his newspaper and his CANSLIM approach. Over time, as I managed to achieve both profitability and consistency in my investing, I began to look for what I’ll call ‘probability-enhancers’ to layer on top of the standard CANSLIM paradigm. For this reason, the other night as I listened to both CANSLIM traders who were presenting their versions of O’Neil’s methodology, I could not help but revisit my own growth as a trader.