I may have finally found my holy grail of trading.

Here is what I did.

I wait until the market is undervalued(look at the market valuation graph)

When this bottomed at .94 I bought a ton of 5 star wide moat stocks which I will sell when they are 3 stars.

I will not buy any stocks when the market is overvalued. Instead I will be selling all of my 5 star to 3 star stocks.

This gets me in the market and the bottom and selling at the top.

This is an exponential gain since I am riding the market up and picking good stocks

Originally posted in thread: 602

An simplified plan. Should work well if you can address a few issues:

1) Markets rarely get seriously undervalued for very long. Then they stay overvalued for extended periods. If you sell to early, it takes a special type of tempermant to stay out of the market. It is this one skill (however simple and complex) that makes the difference between brilliant to avg. investing.

Sometimes the best trade is the one you never made... (this is a deeper thought than you might think)

2) You mention trade, how quickly do you think these stocks will move from 5 to 3 stars and back?

3) Are you a net buyer of stocks, or retiring/retired?

4) What if your in 5 star stocks and the market continues to slide... will you hold, buy or sell?

Your right, Morningstar has some wonderful tools out there that will get you in the market at great times, but valuations can change unpredictably. What looks undervalued today can look overpriced tomorrow and vice versa. I use Morningstar, MSN investing tool box screener and SEC.gov almost exclusively. So you know using Morningstar tools has my vote of confidence if used right.

BGF

Originally posted in thread: 602

That is another name for market timing. In the long run, market timers break even. The "good buy point" may be the highest the stocks are for five or ten years.

Originally posted in thread: 602