The Traders Journal

An Organized Process to Navigate the Markets - ChartPack Update #19 (Q1, 2018)


In the 18 years I’ve been teaching investors to grow their wealth, I believe I can simplify it down to two basic prerequisites for success.  Despite all the clatter, prattle and bluster that increasingly emanates from the financial industry, individual investors can multiply their probability of success many times over by grasping two essentials.  I’ve witnessed that the investors who focus on these two have built and grown significant wealth. These are my factual observations. End of story.

Prerequisite Number One: Your likelihood of success skyrockets if you build a methodology that you not only understand thoroughly but also personally embrace as well. Our Tensile Trading book describes our methodology in step-by-step detail. Take from it what appeals to you the most and then assemble your own approach so that you will know precisely what it is you are looking for in stocks, ETFs and mutual funds. 

Prerequisite Number Two: The second huge probability enhancer and wealth builder is organization.  Some call it process; in our blogs we often refer to it as routines. It simply describes money management tasks in a clear, defined and easy to navigate manner which you can consistently accomplish.  I’ve witnessed investors take over a decade to achieve this routine / process / organization. I’ve also seen investors never achieve this objective.

The ChartPack can be the basis of your routines. We’ve spent thousands of hours boiling it down to the essentials and thereby vaporizing the clatter, prattle and bluster.

As Joe Friday used to say in the 1950’s television detective series, “All we want are the facts, ma’am.”  The ChartPack gives you just the essential stock market facts.  We are thoroughly pleased with this quarter’s improvements and updates to the ChartPack. We know you will be as well as we continue to nudge and enhance our collective investing probabilities in our favor.


#10.07 – A Buffet of Asset Allocations

The feedback we hear from investors who’ve read our book is that one of the top 20 takeaways is that we managed to prune the universe of thousands of asset classes down to the essential 59 classes and still managed to cover all the important bases.  Since we published Tensile Trading in 2016, a number of the ETFs we chose as “best in class” have been surpassed by other ETFs.  Today’s update replaces eleven (11) of the original ETFs with better low-cost performers. 

This ChartList should be one of the key pillars of your asset allocation strategy, and as such, it is imperative that you have it populated with the strongest, lowest cost, highest performing ETFs possible. By ranking, sorting and reviewing these asset classes once a month, you clearly know which assets you need to be in and how to allocate your portfolio across these assets.  The following is a list of the asset classes where we replaced the old representative with a new higher performer “class president”.

  1. Large Value US
  2. Large Blend US
  3. Dividend Yielders US
  4. Mid-Cap Blend US
  5. Small Value US
  6. Small Blend US
  7. Global Biotech
  8. Global Small Caps
  9. Global Emerging Markets
  10.  Regional Europe
  11.  Emerging  Market Debt

#10.9 – Sample ChartStyles

We added a second performance-based chart in addition to the existing PerfChart. We are particularly fond of using the PerfChart format in comparison of multiple equities. This new performance chart is once again based on percentage versus price performance and is therefore a powerful chart style for monitoring your holdings.

As investors, we want our assets working for us as best as possible. This requires our ticker symbols to be performing better than their sister stock alternatives and the indexes we’re endeavoring to outperform. Charting these as price-based chart overlays does not present relative performance as clearly as using a percentage overlay.

In our personal accounts, we have a separate ChartList where every equity we own is presented in the performance view. It makes it clear which assets are strongest and which are underperforming our benchmarks. A nice option is to use the CandleGlance view on this ChartList to easily see all your equities side-by-side for visual performance conclusions.

#105 – ETF Master Watchlist

A major ETF rating service (which will go unnamed) has expanded the number of ETFs that it rates. In reviewing all their new additions, we found eight new highly-rated ETFs that justified being added to our watchlist. For example, the iShares Russell Top 200 Growth Stocks (IWY) has outperformed the markets and has other attractive attributes. We have added IWY along with seven other compelling ETFs to this indispensable ChartList.

#640 – Institutional Dividend Darlings

This ChartList is populated by the 26 stocks most commonly owned by the top dividend-oriented ETFs and best mutual funds. Historically, these equities cycle through long periods of outperformance and slight underperformance versus the S&P 500.  We felt that adding four ETFs to the ChartList allows users to better monitor these cycles as well as presents four top-tier dividend-oriented ETF alternatives to simply buying individual stocks. 

The yields for these four ETFs ranges from 1.85% to 4.74%.  The expenses range from 0.07% to 0.39%, while assets under management reach $17 Billion for the largest.  Please note that the charts are performance plots, so therefore it is very clear as to the relative outperformance of these dividend yielders versus the S&P 500.

ChartLists 420-12 to 420-90 – Fidelity Sector Portfolios:

Anyone who knows me well will tell you - I’m a sports junkie.  The way I see it, there has never been a better time to be a diehard sports fan.  Why?  Well, coverage.  And not just coverage, but endless coverage.  And not just endless coverage, but endless insider coverage that’s so good it even sometimes (or often…) borders on over the top and downright weird.

You see, what I love most about sports today is the limitless, 24/7 insider access we’ve been granted – the behind-the-scenes footage, the locker room videos, the tweets and Instagram posts and more from athletes we idolize on the field, the court, the ice or wherever else they compete.  As followers today, we truly get to follow like never before, no matter where our favorite players go or what they’re doing. In short, we get to see what, when, where, why and how the pros are doing, uncovering a perspective on sports that was previously little more than a mystery.

With our ChartPack and the Fidelity Select Portfolios that we track, that same concept applies.  By carefully analyzing the top 10 holdings of all 40 Fidelity Select Sector Portfolios from quarter to quarter, taking note of what’s been added and what’s been dropped, we can gain unique, timely, tradable insights into the accumulation (buying) campaigns of some of the market’s big money institutional players.

Following LeBron James on Twitter isn’t going to make me any money.  Following the Fidelity Tech fund though?  Now that just might.  With that in mind, let’s take a closer look at a few highlights I noticed.

  • How would I describe Q1?  Volatile.  We saw the (pretty epic) return of volatility this past quarter, with huge swings in the $VIX and a complete disruption of last year’s steady uptrend.  Not surprisingly, the Fidelity funds were moving.  Q1 saw the lowest ever number of unchanged funds in the many years that I’ve been tracking these numbers.  One of the most active funds I noticed was the Brokerage / Investment Management Portfolio (list GR-420-20), which added four new positions to its top 10.
  • Netflix (NFLX) continues to be an absolute stunner, topping earnings estimates earlier this week once again with huge subscriber growth.  The Consumer Discretionary Portfolio (list GR-420-30) took a BIG position in NFLX this past quarter, adding the stock as one of its largest holdings. That institutional support is yet another nice boost for an already great stock (one that I own - full disclosure).
  • The Financial Services Portfolio (list GR-420-44) brought back two major financial institutions that had dropped out of its top 10 just last quarter.  Perhaps more notably, the fund dropped Wells Fargo, which is unsurprising after all drama the bank has faced in the past few months, including today’s news of a $1 billion fine for the car-loan and mortgage violations.
  • The IT Services fund (list GR-420-58) added a substantial position in online domain services company, GoDaddy (GDDY).  That stock has maintained a strong uptrend that continues to look promising even in today’s uncertain conditions, and GDDY is now held by multiple Fidelity Portfolios.  I’ve added it to my watchlist and am keeping a close eye on the stock for now.
  • The shakeups in the Technology Portfolio (list GR-420-80) were major, with Google (GOOGL), Facebook (FB) and Autodesk (ADSK) getting the boot in favor of Salesforce (CRM), Adobe (ADBE) and PTC.  That shift in institutional support is an interesting one, and the charts tell the story.

Already Have The ChartPack? Here's How To Upgrade:

  1. Log in to your account, then click the "Your Account" link in the upper right corner of the web page
  2. Scroll down and click the "Manage ChartPacks" link towards the bottom of the page
  3. In the table that appears, find the entry for the "Tensile Trading ChartPack" (if you don't see the Tensile Trading ChartPack listed there, that means that you haven't purchased it - click here to purchase the ChartPack now)
  4. Click the "Re-Install" button next to the Tensile Trading ChartPack to start the re-install process

The download should take about 15 seconds, after which you can explore the new ChartLists and other updates!

Installation Instructions for New ChartPack Users

If you would like to add the Tensile Trading ChartPack to your StockCharts account, CLICK HERE to get started.

p.s. Have You Heard The News?

Back by popular demand, Grayson and I are hosting another Investors Boot Camp, which kicks off this May 19th - 20th here in Seattle. The testimonials speak for themselves, and I strongly encourage you to read those to hear what previous attendees have thought of this unique event.

2 days. 14 investors. 1 transformative experience.

Join us for two enriching days in my downtown Seattle trading office among a small group of just 14 investors. With a seminar this size, in a unique environment this engaging and intimate, it will be unlike any other investing event you've ever attended. It's no wonder that, for Grayson and I, the Boot Camp has quickly become our favorite teaching forum. Whether you're new to the markets or a seasoned trader, the Boot Camp will make you a better investor. Period.

Course Goals:

  • Learn Proven Routines, Strategies and Methods
  • Avoid Mistakes and Overcome Fears
  • Build a Personalized Asset Allocation Profile
  • Find Your Financial Freedom

Only a few seats remain, and they will not last! To learn more or register for next month's Investors Boot Camp, CLICK HERE.


Trade well; trade with discipline!

Gatis Roze, MBA, CMT
Grayson Roze, Business Manager,
Co-Authors, Tensile Trading (Wiley, 2016)
Co-Presenters, How To Master Your Asset Allocation Profile


Gatis Roze
About the author: , MBA, CMT, is a veteran full-time stock market investor who has traded his own account since 1989 unburdened by the distraction of clients. He holds an MBA from the Stanford Graduate School of Business, is a past president of the Technical Securities Analysts Association (TSAA), and is a Chartered Market Technician (CMT). After several successful entrepreneurial business ventures, Gatis retired in his early 40s to focus on investing in the financial markets. With consistent success as a stock market trader, he began teaching investments at the post-college level in 2000 and continues to do so today. Learn More
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