September Edition

---John Sweeney, Technical Editor

IMF Corporation
325 South 3rd St., Bldg. 1, Suite 294
Las Vegas, NV 89101
Phone: 800 491-9951, 949 643-9064
Fax: 949 643-8312
Product: Manual detailing a simple trading strategy.
Price: $59.50; Guide to Call Options, $39.50; Guide to Shorting Hi-Performance Stocks, $79.50. All three: $139. All include free updates via fax on demand or via Internet. Add $5.50 shipping & handling.

The Pitbull Investor bills itself as "a disciplined tactical stock investment system." My opinion? Strike the "investment" notion: This is delightful speculative material. It's a simple approach shooting for 200% return on investment. Plus, at $60 for the idea and the procedure, it's quite cheap in these days of $3,500 trading systems.

So is it worth $60? In the current bull market, the return on your investment is likely to be much greater than $60. If you don't like the buy side, you can also pick up IMF' s manual on short selling for $60. What's attractive about Pitbull is it presents a straight forward approach to combining fundamentals and buying momentum. Of course, the day will come when momentum will no longer be the easy way to trade, but when that day comes, this system simply won't come up with many stock picks. When that happens, you'll need to have the short-selling system running.

The manual puts it well: "This is a common sense approach to stock selection that focuses on fast growth, moderate risk and a merciless approach to cutting our losses at the earliest possible stage before they get out of hand."
Wisely, its first three goals are: Don't lose money, Don't lose money and Don't lose money.

The system aims to find the stocks that are breaking out, which is your call to jump on board - and if the stocks don't pan out, you get rid of them immediately.

The basic system comes with something even more valuable than the entry and exit rules: pithy, realistic direction on learning and implementing your speculative trading. The publisher, W.H. Ford, not only focuses on not losing money, but also on the problem of getting back to cash with returns above the myriad small losses of time as well as the opportunities of diversification. He also points out that this mechanical system allows active investment, even with a life away from the trading screens. The only problem he doesn't deal with is all the tax events that trading creates, which can of course drag down returns.
I was unable to find any users who didn't like this system or Ford's approach - which requires no computer, offers simple rules and promises good performance. Of course, being in a bull market always helps performance No third-party confirmations of trading results were available for this system though IMF's Web site does have records of past selections you can review.

You can trade this system once a week on your own, or follow faxed instructions from the company. You can even check your work with postings at the company's Web site. If you absolutely must use a computer, you can get spreadsheet templates for the PC or Macintosh to use for computation and tracking.

GOING SHORT Even in these days of booming markets, plenty of stocks can be found tanking. For an extra $60, you can use Pitbull's system for shorting high-flyers. It turns out there are plenty of candidates for short selling, and the rules are unique, not simply a reverse of the rules for going long. The rationale behind the strategy makes sense, can be implemented easily with paper and pencil and is accompanied by the vendor's elaboration on using puts to take positions on the underlying instead of the outright short.

Of the market wisdom passed along, Pitbull includes an indicator designed to alert investors if something goes wrong with the current market: a crash index. The data for this index can be accumulated on your own or accessed via IMF's Web site or taken from the weekly faxes. A straight forward idea, it may get you out a bit too often, but it will certainly get you out before disaster strikes, keeping with the idea that several small losses are preferable to any big hits.


The Pitbull Investor represents a model approach to selling a trading system: The developer gets $60 for the idea, discloses it completely and then earns some additional income after the initial sale by implementing and/or updating market calls for people, or even pulling the trigger for them. According to IMF, some 13,000 customers are currently relying on IMF for updating. Most folks just don't have the time to trade all the gee-whiz systems they find out there; there's a market for ongoing service, and IMF provides that.

I liked the systems offered in The Pitbull Investor, especially in the market we have today, which, as far as anyone knows, could last many more years and peak at levels inconceivable today. You can get the manual for the cost of a couple lattes, and if you don't like it, you can return it as late as six months later (only about 2% of trials do this). If you have a rigorous loss-control system in place, then you have little to lose by buying a copy of The Pitbull Investor and puting the approach to work.

---John Sweeney, Technical Editor

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