On February 13, 2009, I wrote an essay called, "Another Day at the Races." I had developed a technique of buying or shorting fast moving stocks in fast moving strategies, so I detailed how I tracked the performance of nine strategies, five bullish and four bearish, from the market's Open at 9:30 AM to its Close at 4:00 PM. In my mind, it was like going to a racetrack and watching the horses run. It was great fun and often quite profitable, so we created the VectorVest RealTime Derby.

The VectorVest RealTime Derby tracks and displays the performance of over 175 VectorVest Strategies from the time the market opens to the time it closes. With this tool, I could easily see which strategies or stocks I wanted to trade on any given day. Not only that, but I could see internal market action like never before. Take today, for example: I could easily see that the opening rally of the major indexes wasn't going to last because the Derby showed Bearish strategies out-performing Bullish strategies. Sure enough, the major indexes turned lower shortly after 10:00 AM.

With the Derby providing a tremendous amount of valuable data each day, we now needed a way of storing and analyzing it. So our developers created the Tote Board. We are very proud to announce that the Tote Board is being released today to all VectorVest RealTime Derby Users at no extra charge.

Like the Tote Board at your favorite track, the VectorVest RealTime Tote Board stores the daily Derby results and provides useful statistical information on performance. Over a time period of your choice, it shows the total gain or loss of every strategy, the percentages of the winning days and trades, and the maximum draw down. This information makes it extremely easy, of course, to see which strategies have been the best or worst performers over the time period you selected.

As I look at the Tote Board right now, 2:32 PM, the best performing strategy over the last five days is Odd Fellows Short with a gain of 8.57%. It's made money in four of the last five days, which is tops for any strategy, and it's had 68% winning trades, which is second best. It also was listed as a Top-Five Performer in Tuesday's Color Guard, and it's already up 4.1% today. Should I go short with this strategy? I just might do that. Thanks guys for The Derby and The Tote Board.

PROTECTING PROFITS.
The Price of the VectorVest Composite has gone up 61.4% from the March 9th low to yesterday's close. If you have been fortunate enough to participate in this rally, you should realize it's not going to last forever. Even if you may not wish to sell any stocks right now, you should learn how to protect profits. Mr. Steve Chappell, our Director of Educational Services, will share his knowledge and experience in how to perform this delicate task. So join Mr. Chappell at the VectorVest University to see this week's "Strategy of the Week" presentation: "Protecting Profits."

Four weeks ago I began writing about a $500,000 retirement strategy for people in IRAs or 401Ks that would produce $50,000 per year of current income while maintaining the principal. I said that I would put $200,000 into relatively safe bond funds that were paying about 6% interest and then build three $100,000 stock portfolios with the remaining $300,000. Almost immediately we began receiving calls and emails asking about safe bond funds. That's not our particular field of expertise, but I didn't think it would be all that hard to find such funds, and it's not.

Just recently I went to my bank and put some money into a "Tax-Advantaged Municipal Closed End Portfolio," which is expected to pay about 6.9%. You should be able to do the same if you wish. If you don't want to do that, you can Google the term, "safe bond funds," and get nearly 900,000 hits. The top three listings should more than meet your needs. Of course you can always Google the term, "Pimco," and also receive a wealth of information.

If you don't want to go that route, you can always use VectorVest. Simply click on Viewers on the Main Menu Bar, click on Sector Viewer, click on ETFs, right click on the ETFs row, click on View Industries in Business Sector, sort By Industries Asc, click on ETFs(FixedInc\Other), right click on the ETFs(FixedInc\Other) row, click on View Stocks in Industry Group and sort by DY. You should see JNK at the top of the list with a DY of 12.29%. Overall, you should see nine ETFs with dividend yields of 6% or more. Pick your poison.

As you can see, even in the world of zero percent Federal Funds rates, you can still find Relatively Safe Bond Funds Paying 6%.

ATTENTION REALTIME USERS.
Have you run any searches using double crossovers? Try it, you'll love it. I've been experimenting with a search that finds stocks having a 20 day DPO crossing above zero and MACD crossing above the signal line within the last two days. The search also find stocks with Price greater than $1.00, AvgVol > 100000, and %PRC < 100. It is sorted by %PRC Desc. It has found some really big winners, and virtually all of the Quick Tests I have run, of which there have been many, have given positive results.

DON'S DIVIDEND DANDIES.
Would you like to buy stocks with the highest combinations of Dividend Yield and Earnings Yield? Then sort them by DY*EY. Ah, but there's more to it than that. Mr. Don Thornton, one of our best instructors, will show us the magic little twist that produces the best stocks with the highest DYs and EYs. So join Mr. Thornton at the VectorVest University to see this week's "Strategy of the Week" presentation: "Don's Dividend Dandies."

We went long in the YBR portfolio yesterday with selections from the "Explosive GRT & EPS Stocks" Strategy. The VectorVest RealTime Derby made the decision to pick this strategy as simple as pie.

The "Explosive GRT & EPS Stocks" portfolio clearly had the highest performance rating of the strategies recommended in Wednesday night's Views. We calculate a portfolio's performance rating by multiplying the percent winners times the percent gain. Since the RealTime Derby calculates the percent winners and the percent gain on a tick by tick basis and delivers the results on a second per second basis, we were able to make our decision quickly and easily.

If you are not using VectorVest RealTime, you can obtain a close approximation of a portfolio's real-time performance by using our Portfolio Tracker, which is free. Another option would be to use Yahoo!Finance. In this case you'd have to manually build a WatchList of the stocks from each strategy and check them when the major indexes all gain more than 1%. This event happened yesterday at 10:09 AM, so we jumped in.

Now we are faced with the task of managing the portfolio. You may recall that the original exit strategy for a long YBR portfolio was to sell any stock that had achieved a 50% gain or a 30% loss. Stocks that were sold from the portfolio were not replaced. In real life, I found that I could not handle using a 30% Stop, so I began to use tighter Stops. I finally settled on using Stops that were 10% below the higher of the purchase price or the highest closing price attained thereafter. This seemed to work quite well, but I don't know if it gave the best results as far as risk vs. reward goes.

Even though I did some investigative work on this issue, I asked Mr. Glenn Tompkins to look into it more thoroughly. My ultimate goal is to get the maximum profit at the minimum risk. I'm sure that Mr. Tompkins will be able to help me find the sweet spot in Managing the Yellow Brick Road Portfolio.

Last Friday I said that the market had been "as flat as a pancake" and the Buy, Sell Ratio, BSR, a.k.a., the Canary, had given us fair warning that the magnificent rally from the March 9, 2009 low was losing steam. Sure enough, stock prices fell sharply on Monday, June 15th, and the Primary Wave, i.e., the week-over-week movement of the Price of the VectorVest Composite, went from Up to Dn.

It is highly unlikely that the Primary Wave will return to an Up mode today, given the market's wishy-washy performance. Therefore, it's time to prepare to go short in the Model Portfolio if the market moves sharply lower. It is also a good time to review and update the procedure we will use. Here are the basic steps:

1. BEST STRATEGIES. First of all, we will identify five Strategies that we believe are the best ones to use under current conditions. We give you five Strategies instead of one because we do not want to "move the market." We have also discovered that being open to using more Strategies increases your chances of picking a really big winner.

2. EXAMINE THE STRATEGIES. Before the market opens on Monday, use the UniSearch and Quick Test Tools to see how each Strategy has performed recently and what kind of stocks they have been finding. Are they right for you? If not, it's OK to cherry pick a list of stocks that are more to your liking.

3. WATCH THE FUTURES. The Futures give an indication of whether the stock market is likely to open higher or lower. Since we're planning to go short, on Monday, we want to see the Futures on the Dow, S&P 500 and NASDAQ go down. This information is available on TV as well as the internet. PLEASE NOTE: THE MARKET DOESN'T ALWAYS DO WHAT THE FUTURES INDICATE.

4. WATCH THE MARKET OPEN. The key to making a good entry is to make sure the market is going in the direction you want. All sorts of things happen as the market opens. It often reverses course in early trading, so it's best to wait 30 to 60 minutes to get a better idea of what it wants to do. We want to go long on a sharp up move and short on a sharp down move. By "sharp," I mean that the DJX, SPX and IXIC all must be up or down by one percent or more after 10:00 AM EST. They also must be trending in the right direction at the same time before you trade. BOTH OF THESE CONDITIONS MUST BE MET.

If you miss the Open, it's OK to make your trades as long as the appropriate conditions prevail.

5. TRACK STRATEGY PERFORMANCE. You should begin tracking the real time performance of the top 10 stocks from each Strategy from the time you see the market moving in the right direction. If you don't have VectorVest RealTime, you may use VectorVest Portfolio Tracker, but it is on a 15 minute delay. You may also track a portfolio's performance in real time on Yahoo!Finance, or similar facility.

6. PICK STOCKS FROM THE STRATEGY WITH THE BEST PERFORMING RATING. The performance rating is the percent winners times the percent gain. For example, a Strategy may yield seven winners and an eleven percent gain. Its performance rating would be 7.7. Another Strategy may have three winners and a 20 percent gain. Its performance rating would be 6.0. I'd pick the Strategy with the 7.7 rating. When going short, I will not sell any stocks that are going up in price.

7. BE PATIENT. If the desired conditions do not develop on Monday, just sit tight. Watch the Daily Color Guard Report on Monday evening and re-assess the situation. The whole idea is to make the right trades at the right time.

The procedure I have just described has evolved over a long period of time and I have written about it many times. Today I simply covered that aspect of entering positions. Next week, I'll cover the subject of Position Sizing; then Managing the Model Portfolio. That should complete this Update on Riding the Wave.