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August 10, 2007 – Comments (8)

I noticed this morning that CAPS has a new leader, luvb2b. If memory serves, and now that I'm AARP material serving is not always what it does, it seems to me that yesterday there was a different CAPS leader. If that's true, I apologize for not remembering just who you were.

Where was I? Oh, so back to the new CAPS leader. First of all, congratulations. Being Numero Uno among all of the outstanding investors playing CAPS is no small achievement. I certainly hope that your reign as CAPS King is long and storied!

Which brings me, stumbling I admit, to my original thought. I took a peek at luvb2b's CAPS picks, I mean if I can find a bargain...why not? I can tell you I was floored. Out of 149 active picks, 137 are picked to Underperform the S&P 500.

Admittedly, I was stunned when I saw that. Don't ask me why, I just was. There just seemed to be something wrong with that, something disingenuous, something very...CAPS.

I mean here was the CAPS leader with 92% of his picks set as underperform. It just struck me as strange. Of course in light of the way the markets have been of late, and the way they will probably continue to behave, our leader's timing seems exact. Good for him.

But I thought the idea behind CAPS was to make us better investors? I mean that's what it says on the CAPS Help screen, that the premise is..."Working together, we can improve our investing results."  

I'm not saying that we aren't all working together, I mean we are all apart of CAPS and we are all letting each other see what stocks we've chosen, and in some instances we've even allowed other players to see WHY we've chosen a specific stock. So in the purest sense we are all working together to improve our investing results.

But as we say in Texas, this ain't my first rodeo. I know that there are a good number of younger investors out there that are seeing players like luvb2b and thinking they can transfer his CAPS investing strategy to the real world.

The fact of the matter is...you can't. Certainly you could pick 147 stocks and then short 92% of them. And for that matter, you may even do quite well, for a day or two. But at some point, an investment strategy outside of CAPS, like so many strategies that seem to end up leading the CAPS pack, simply won't work over the longer term.

Heck, just the trade charges would seem to negate any potential profits!

Of course we would all like to stand proudly at the top of the CAPS heap, even it were for one day. I know I would strut around with my chaps on, bull whip in hand...oh sorry.

So all I'm asking folks to do is enjoy playing CAPS.  Enjoy taking with you the thoughts of other investors, enjoy leaving your own thoughts so that investors might take them to the places they travel.

But above all else...above all else...above...

Well ain't that fine howdo ma'am...I forgot where I was going with this.

Wax

8 Comments – Post Your Own

#1) On August 10, 2007 at 9:44 AM, TMFCHarris (99.57) wrote:

Wax,

As we used to say in Neuvo Mexico, your blog is the green chili on the waffle.

Interesting side note about players who are big with the underperforms - while many of the best players are that way, the overall distribution of extreme red-thumbs by rating is pretty even. The best way to see this is to check out the skeptic charm and find the midpoint. There are about 1,000 players who are at least 50% underperforms, and the range of ratings for players 480-520 is 50.66 - 45.79.

Don't really know what that means, but it seemed interesting.

Chris 

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#2) On August 10, 2007 at 10:26 AM, freunddoggy (98.87) wrote:

Wax, as always, you rock.

Here are my thoughts as to why we don't work together:

Getting the number 1 spot = insane and FREE publicity. That is the reason why I, myself, want to get there. There is no way to get there without shorting like mad. I digress, actually, there is a way, but it's extremely difficult and noone seems to have done it yet.

In my personal opinion, the top Yes Man is the #1 person to go to for REAL WORLD investment advice. This title goes to empryean. I also really like sommer316 right now, as his accuracy is fantastic.

I have them both as favorite players and try to learn as much as possible from them, moreso than any other.

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#3) On August 11, 2007 at 5:37 AM, wax (97.03) wrote:

Chris;

I don't really know what it means either, but I'm kinda thinking about the green chili on the waffle thing, and I think it may be...interesting.

Wax 

 

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#4) On August 11, 2007 at 5:57 AM, wax (97.03) wrote:

freunddoggy;

I was looking at empryean's stuff and I see that he his picks are weighted to energy and transportation, just as the S&P is at the moment, which is probably giving him a nice kick in the pants at the moment. I just hope it continues.

I also looked at sommer316. I like that their picks seem more balanced over a broad spectrum of industries. While that may not put you to the top of the heap in CAPS, in the real world it should bring very nice returns, especially over the longer term.

As to rocking? Thanx. Investing and all that goes along with it, including my generally obtuse thoughts, is supposed to be fun. If my thoughts give someone a smile or makes them think I'm a first or second or third class...Alberthole, then good for  me. So thanx for the kind words.

Wax

 

 

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#5) On August 12, 2007 at 10:07 PM, denig (< 20) wrote:

Hey wax (& freunddoggy),

 

Just a small comment, I noticed that freunddoggy's chart has come down as quickly as it went up!  One thing that I look at when surfing CAPS is consistency and accuracy.  Just my two cents... (freunddoggy congrats on your #1, I'd love to see you get it back up there)

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#6) On August 12, 2007 at 10:15 PM, denig (< 20) wrote:

Oh, and for empryean I've noticed that he's only made picks on CAPS on two occasions... hardly a real life scenerio... unless you want to buy 50 different companies tomorrow?

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#7) On August 13, 2007 at 5:52 AM, wax (97.03) wrote:

I used to try and pay attention to the charts, believing that they were a predictor of accuracy.

But the charts are based not only on the players picks, but also on the players picks against the S&P.

What I found to be far more useful was the Average Pick Score.  

Wax

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#8) On August 13, 2007 at 8:14 PM, denig (< 20) wrote:

Oh, and for empryean I've noticed that he's only made picks on CAPS on two occasions... hardly a real life scenerio... unless you want to buy 50 different companies tomorrow?

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