Blood in the Streets Time to Buy?

Stock Market Video

Dont Cry

In Case You Missed It

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Taking on the title of Editor is always a little dizzying for someone who thinks of himself primarily as a writer. Ive been at Cabot for more than seven years, and Ive been the Editor of the Cabot China & Emerging Markets Report for six of those years. Being called the Editor means that I take responsibility for seeing that it gets written and for everything that it says. And thats the way it will work in my new additional role as editor of Cabot Wealth Advisory as well.

If you have any questions, comments, criticisms, quibbles or kudosand I hope for lots of eachI hope you will put your hands to the keyboard and send them along. I will read everything you write, and will respond whenever it seems called for. Let me hear from you.

Today, while the New England summer is letting us know that it will start when it darned well pleases, Ive been thinking about the difference between the weather and the stock market.

When the sun comes out in this region and the thermometer tops 80, it takes no time at all for New Englanders to head for the beach. Even if its been cloudy for so many weeks that webs are growing between their toes, people in New England know that theyd better slap on the sunblock and look for a spot on the sand for towels and coolers.

But its a little different with rainy stretches in the stock market. Even after the major indexes have shown some good strength and have climbed back into convincing uptrends, many investors continue to sit on the sidelines. And many of them will continue to sit while loads of money is being made by people who are climbing back on the bandwagon.

The real shame is that some will persist in shunning the market until the rally has gone on for so long that everyone is happy and totally optimistic about stock investing. Maybe there will even be a cover story in Time magazine about the new, improved stock market.

So they finally jump into the market just as it begins to peak, stalls out and starts the correction process that will wipe out all late arrivers, which is what it always does. This is the wrong time to buy.

Some legendary investorsources suggest that it was Baron Rothschild in the days following the defeat of Napoleon at the Battle of Waterloosaid that the time to buy is when theres blood in the streets.

If you take that to mean that its a good time to buy when assets are extremely oversold, its probably true. But whats true for a massively wealthy banking family isnt necessarily true for individual investors.

And if you take the quote to mean that you should try to buy the market at the bottom, then its not only false, its impossible!

If you would like to know how to make the transition out of a bear market with confidence when it’s time to buy, I have a suggestion. And it should come as no surprise to you that it involves a Cabot newsletter.

The suggestion is based on the fact that the Cabot Market Letter has 41 years of experience getting investors out of bear markets and into cash, and then out of cash and back into bull markets. The method has nothing to do with intuition, economic predictions or the Magic Eight Ball.

The Cabot Market Letters Cabot Trend Lines, Cabot Tides and the Two-Second Indicator have been honed and refined to make sure you never, repeat NEVER, miss a major bull move and never stay heavily invested during a major bear move.

Bull markets are a great phenomenon; they make you feel smart and they make you money. And the confidence that comes from following a proven market timing system only adds to the experience. With the Cabot Market Letter and its award-winning timing system, you will Know the Bull when it arrives. No Bull. For details, click here.

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In this week’s Stock Market Video, Mike Cintolo, the editor of Cabot Market Letter and Cabot Top Ten Trader. says that the recent strong day or two in the market is a good sign, but theres still more work to do before the trend turns up. Its a time to remain defensive and avoid predictions of either future strength or future disaster. Stocks discussed include Apple (AAPL), Chipotle Mexican Grille (CMG), Amazon (AMZN), and Equinix (EQIX). Click below to watch the video!

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A Quick Profit of 105%

On May 4, subscribers to Cabot Small-Cap Confidential received a recommendation to buy a little stock with a consumer product that is becoming very popular but is still under appreciated by the mass market and most institutional investors. It was trading for 2.19 per share.

But it didn’t stay there for long. Earlier this week, the stock touched 4.48, bringing a quick profit of 105% to subscribers who followed Cabot’s advice—in just 22 trading days! Which means that in those 22 trading days, you could have turned $1,000 into $2,050, or $10,000 into $20,500 or $100,000 into $205,000!

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%img src=/

/media/Images/CWA-Buttons/DontCry.ashx /%Here’s this week’s Contrary Opinion Button. Remember, you can always view all of the buttons by clicking here.

Dont Cry

Created by a child of Alex Seagle, current co-owner of Fraser Management, which created all these buttons. Note the spilled milk. The point is that you shouldn’t obsess over past mistakes or bad luck. Learn and move on.

[Editors note: Some people have no problem at all with the moving on part of this interpretation; its the learning part that escapes most people. The market is always offering lessons on what works and what doesnt, but you have to be willing to change in order to learn from them.]

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On May 22, we picked Ariba for our June Stock of the Month. Before we could even publish the recommendation, they announced a takeover bid by SAP—which sent their stock price skyrocketing 20% in an hour.

Picks like these only prove the promise of Cabot Stock of the Month. that we’ll double your money in 60 days.

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In case you didn’t get a chance to read all the issues of Cabot Wealth Advisory this week and want to catch up on any investing and stock tips you might have missed, there are links below to each issue.

Cabot Wealth Advisory 6/7/12 — The Aggressive Aggressive Investor

Mike Cintolo takes on the techniques and rewards of swing-for-the-fences growth investing and sees value in a company that most of us see every day, and maybe use as our coffee and donuts stop. Featured stock: Dunkin Brands (DNKN).

In this issue, Tim Lutts takes on some big issues, speculating about what might be necessary to reduce the persistence of armed conflicts. He also features a small company with a promising anti-obesity drug. Featured stock: Vivus (VVUS) .