Trusting The Follow-Through Day: Ross Haber | Investing With IBD

TL;DR

Market is showing signs of recovery with a follow-through day and broadening leadership, particularly in the tech and biotech sectors.

Transcript

hello everybody and welcome to the investing with ibd podcast sponsored by direction it's justin nielsen here and it is wednesday august 10th 2022 and joining me as always is arusha paris portfolio manager at o'neill global advisors how are you arusha i'm doing well justin okay and joining us again on the show we're happy to have ross haber co-foun... Read More

Key Insights

• 🥳 The market's follow-through day indicates a potential uptrend, but the health and breadth of leadership stocks are crucial for sustained growth.
• 🧑‍💻 Observing sectors with improving fundamentals, such as tech and biotech, can provide insights into potential investment opportunities.
• 🌸 Risk management is essential, and careful analysis of upcoming events, such as clinical trials or FDA approvals, can help avoid significant losses.
• ✋ Focusing on stocks with strong earnings and performance enhancers can provide a higher chance of success in volatile markets.
• 🇼🇫 Monitoring market sentiment, such as the wall of worry, can provide insights into market direction and potential opportunities.
• 🖐️ Fundamentals play a significant role in investment decisions, and stocks with strong earnings growth and stability are preferred.
• ✋ Biotech stocks require additional diligence due to their high volatility and the potential for event-driven gaps in stock prices.

Questions & Answers

Q: How do you determine the health and breadth of market leadership?

By closely monitoring the performance and rotation of leading stocks in various sectors and industries. Looking for strong earnings, volume, and price action can indicate robust leadership.

Q: How do you manage risk in biotech stocks given the potential for gaps due to clinical trials or FDA approvals?

I closely analyze the pipeline and upcoming events for biotech stocks. If a stock has a significant event approaching, I may trim my position or use tight stop-loss orders to mitigate potential losses.

Q: How do you handle earnings announcements?

If I believe in a stock's long-term potential, I may hold a position through earnings. However, I often reduce my position or set tighter stop-loss orders to protect against potential negative surprises.

Q: How do you navigate a speculative market fueled by meme stocks and excessive speculation?

I focus on stocks with strong fundamentals and technical patterns, rather than chasing speculative plays. By sticking to a disciplined investment approach and focusing on quality stocks, I aim to minimize risk and maximize returns.

Summary & Key Takeaways

• The market experienced a follow-through day on June 24th, indicating a potential uptrend. However, it took some time for the market to gain momentum.

• Leadership and breadth of the market have improved, with notable strength in the tech sector, particularly in software, semiconductors, and biotech.

• Risk management is crucial, and it's important to focus on stocks with strong earnings and performance enhancers, while being cautious of potential gaps due to events like clinical trials or FDA approvals.