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The Secret of Social Relative Strength and Stock Picking

Way back when I started Wallstrip (before Twitter and Stocktwits) I was sitting with Fred Wilson riffing on how I thought Crocs was a great ‘undiscovered’ stock. The price was going up but people (investors and traders) were not taking it seriously. I pointed Fred Wilson to YouTube and there were tens of thousands of people talking about their Crocs in videos. Sure enough, the stock continued to climb and climb. The stock had strong relative price strength but a low social relative strength. Continue reading The Secret of Social Relative Strength and Stock Picking at Howard Lindzon.

Way back when I started Wallstrip (before Twitter and Stocktwits) I was sitting with Fred Wilson riffing on how I thought Crocs was a great ‘undiscovered’ stock. The price was going up but people (investors and traders) were not taking it seriously. I pointed Fred Wilson to YouTube and there were tens of thousands of people talking about their Crocs in videos. Sure enough, the stock continued to climb and climb. The stock had strong relative price strength but a low social relative strength.

I thought if you could find more public companies with striong price relative strength but low social strength I was on to something.

It was a catlayst that hedge funds and institutions would not have yet thought about or cared.

It is 2020 and that same startegy works for me and it is even easier for me to spot the social realtive strength because of Stocktwits.

I look for the best relative strength stocks with the least amount of people that SHOULD have interest (retail traders, prosumers, institutions0) NOT ‘watching’ or following the stocks.

Examples the last few years continue to be $POOL $MKTX $FTCH (FarFetch – I am long) $Z (Zillow – I am long).

Eventually the great companies and stocks to get discovered and that does not mean they will stop being great stocks. Some may get better.

For me though, I love finding strong price momentum stocks in which the

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