Archive for September 14th, 2009

  • Last Look McDonalds (MCD)

    As investors build a portfolio, they must put their stock selections into a context of the stock’s individual trend as well as the stocks relative strength versus the SP500 or Nasdaq. You want to compare your stock in relation to the big engines. I have followed MCD now for several consecutive days to highlight the importance of this analysis.

    I had mentioned that McDonalds MCD was not acting well as an individual stock when it was compared to the market as a whole. The stock indexes were rising, but McDonalds was hovering near its recent lows. I said in my blogs to watch the stock and see what happens if the entire market takes a breather and sets back a bit. The theory is that, if the stock cannot go up while the whole market is in a rally mode, what do you think the stock will do, if the whole market declines?

    MCD set a new low on Friday and was down again today. Now we may see a small bounce over the next few days just to correct this recent decline, but the fall in the price of the stock is a clear picture of what can happen if you ignore individual stock relative strength when building a portfolio. I just thought you may have wanted to gain a little more incite into stock selection, as you learn how to take control of your own financial empire.

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    2009.09.14 / no responses / Category: TCC, The Stock Market