But the above styles are just a few of the many different styles somebody might consider themselves to fit into. This also includes the 'All-Style Style', which is really just a combination of some or even all of the different styles put together.

Some of these are more conservative while others are more aggressive.

But which one works best?

Let's take a look at some.

Momentum Style

Momentum traders look to take advantage of upward trends (or downward trends) in a stock's price or earnings. They believe that these stocks will continue to head in the same direction because of the momentum that is already behind them.

And there's a lot of evidence to support the idea that stocks making new highs have a tendency of making even higher highs. Although, this style of trade will likely carry with it a higher degree of volatility, it can be extremely rewarding.

For this Momentum study we'll use one of our strategies called Big Money Zacks.

This method, of course, finds stocks on the move. And aside from focusing on the best Zacks Rank stocks, along with a few other fundamental filters, the main drivers to this particular screen (once we've narrowed down the list) are as follows:

1. First it selects the top 20 Price Performers over the last 24 weeks.

2. Next, from those 20 above, it selects the top 10 Price Performers over the last 12 weeks.

3. Then, from those remaining 10, it selects the top 3 Price Performers over the last 4 weeks.

How Did It Do?

• In 2007, this Momentum Style strategy gained 36.8% vs. the S&P 500's 4.1%.

• In 2008 (with the bear market in full swing), this strategy was up 19.7% while the S&P plummeted -36.4%.

• And in 2009, it was up over 224% to the S&P's 23.5%. (That's right, 224%. As the market was rebounding more than 65% off of the lows, this strategy capitalized on that by getting in on some of the top performers.)

Wow!

So is this the best style?

Maybe for some. But maybe not for others.

The Momentum Style is typically a short-term trading strategy. And this method was designed to be rebalanced once a week, which means you'll be buying and selling new stocks every week. Great if you're an active trader. Not so much if you aren't.

You'll also find yourself getting in on stocks that have already made big moves or that are making new 52-week highs. And it works. But for some, high flyers and fast movers aren't the kinds of stocks they want to get into.

Maybe getting into a stock that's low in its price recognition cycle or finding undiscovered gems is more to your liking.

So let's take a look at the Value Style.

Value Style

Value investors and traders favor good stocks at great prices over great stocks at good prices. This does not mean they have to be cheap stocks in price though. The key is the belief that they're undervalued. That they are, for some reason, trading under what their true value or potential really is. The value investor hopes to get in before the market 'discovers' this and moves higher.

The value investor will typically need to have a longer time horizon because if a stock has been undervalued, i.e. 'ignored' for a while, it may take a bit of time before that stock gets noticed and makes a move.

For the Value Style study, let's use our strategy called R-Squared EPS Growth.

This one too uses the Zacks Rank along with a unique way of finding trendline growth rates. (That's where the name R-Squared Growth came from.) But don't let the name fool you; this is a straight up value screen that keys in on different classical valuation metrics.

How Did This One Do?

• In 2007, this Value Style strategy increased by 11.2%.

• In 2008 (raging bear market), this strategy was up 14.2%.

• And in 2009, it was up 44.8%.

This strategy was designed to have a longer holding period of 4 weeks, which means this strategy would be rebalanced essentially once a month rather than once a week.

Moreover, the very nature of the screen (and the Value Style) is such that it tries to reduce volatility and minimize risk while at the same time outperforming the market.

And while this more conservative style may not produce the kinds of triple-digit returns that a Momentum Style or an Aggressive Growth Style can, the smoother ride it provides, while still outperforming the market, may be just what you're looking for.

Or maybe a Growth & Income Style approach with core holdings that pay nice income-producing dividends is what you're really after.

This kind of strategy will tend to focus on the more mature companies with solid revenue and consistent payouts.

You'll also have a longer time horizon with this style (at least 12 weeks), especially since you'll want to hang onto your stocks long enough to receive the dividend.

Then again, the allure of getting in on a newer company and watching it blaze a trail of success, as an Aggressive Growth Style will try and find, may be your goal instead.

Aggressive Growth traders are primarily focused on stocks with aggressive earnings growth or revenue growth (or at least the potential for aggressive growth).

You'll often find smaller-cap stocks in this category. And you should expect some volatility in this style as well.

This kind of style will require a more hands-on approach to monitor how these companies are doing. But like the Momentum Style, the additional activity can be well worth it when the method is hitting its stride.

And the Winner Is...

All of them.

No one style is better than the other. They're just different from each other.

And that's fine.

The 'best' style is the style that fits the kind of trader you are or want to be.

And this is important because then you'll be able to find the stocks that are in alignment with who you are and your risk tolerance.

If you're an active trader looking for aggressive picks, don't try and fit yourself into a Value Style or Growth & Income Style. You'll quickly grow impatient and feel like you're missing out, regardless of how good you do.

Likewise, if you're more conservative and don't want to trade quite so often, do not try and make a Momentum Style or an Aggressive Growth Style work for you. It won't.

Why? Because if you find yourself getting into stocks that are not in alignment with your style or beliefs, you'll find yourself dropping those stocks the moment the market hits a rough patch. Or talking yourself out of winning trades altogether, because you're uncomfortable being in stocks that don't fit your style.

The Strategies Work Best When You Use Them

The best trading strategy in the world won't make you any money if you don't use it.

Part of the formula for success is to just do it.

And the more confident you are in your strategy, the more apt you will be to use it.

To build confidence in your trading, remember to first:

1. Identify what kind of trader you are or want to become. This will help you find the style(s) that are right for you. And don't worry about fitting perfectly into one style or another. Many people will be a combination of several styles rolled into one.

2. Once you understand the different styles and where you fit in, you can then concentrate on what kinds of items will help you pick the stocks that have those characteristics, so you'll always get into the right ones.

3. Don't give up. As mentioned above, the most successful trading strategies work best when you use them. Once you've indentified your style and the method to pick those stocks, make sure to follow a proven profitable trading strategy to increase your odds of success. This will give you the confidence to stick with it and to maximize your returns.

You can do it.

And to help you get started, you may want to look into our Zacks Method for Trading: Home Study Course. It's a DVD/workbook set that guides you to better trading step by step. In it, we go over in detail how to identify what kind of trader you are, how to find those stocks with the right style characteristics, and how to trade them so you can consistently beat the market. It also goes over some of our best performing strategies from all of the different trading styles and shows you how to create your own.

If you're interested, be sure to check it out now. Remember we're making it available to you at our cost - an arrangement that was set to expire next Monday. But because the response has been so overwhelmingly positive we need to move up the deadline to 11:59 pm Saturday, January 30. Click here to learn more.

Thanks and good trading.

Kevin

Kevin Matras
Vice President, Zacks Investment Research

Zacks VP Kevin Matras is our chart patterns and stock screening expert. He runs the Research Wizard and personally developed many of its built-in market-beating strategies. He also directs the Zacks Method for Trading: Home Study Course.

Zacks Investment Research

That potential problem was very well telegraphed, and led to a huge amount of spending in the Tech sector to try to avoid it. It provided the final few pumps to the Tech bubble that was already well under way due to enthusiasm about a revolutionary new technology, the Internet. The enthusiasm proved to be way overdone, even though the Internet did largely fulfill its promise to transform vast swaths of business and culture.

What Came First: The Strong '90s

The 1990’s had been a hugely successful decade for the United States, and we were almost as dominant then as we were at the end of WWII when the rest of the world was in ashes. Our previous big rival, the USSR, had been dissolved and its successor was an economic basket-case. The stock market was hitting new highs on a regular basis, the economy was near full employment and inflation was low.

The dollar had soared to new highs, which helped keep inflation low, and was great for our sense of national pride (though not so good for our net exports). The stock market was fully pricing in a very optimistic outlook for the economy and was trading at record high valuations, not just for the tech-heavy Nasdaq, but for the S&P 500 as a whole. The Federal Reserve was warning that our biggest economic problem was that the Federal debt was in danger of being fully paid down, and that would make it difficult for the Fed to conduct monetary policy.

Laissez-Faire Policies Took Hold

Under the surface, some things had happened that would prove to be extremely harmful. The culture had grown so that entrepreneurs were celebrated above all others, and the feeling was growing that the best thing the government could do for the economy was to get out of the way.

That the game was best played when the refs kept their yellow flags in their pockets. The financial rules were made far less strict under the passage of Graham Leach Bliley and the Commodities Futures Modernization acts. The first largely repealed the Glass-Stiegel separation between banks and investment banks (it had been greatly eroded over time, so in some ways the law was only recognizing and legitimizing the reality of the time). Bob Rubin, who was most responsible for the undermining of Glass-Stiegel at the government end of things before the law was repealed had quit government and gone on to become Vice-Chairman of Citigroup (C), which was at the forefront of the new “financial supermarket" model.

The Tech Bust...and Then 9/11

After Y2K turned out to be one of the greatest non-events in recent history, investment in the Tech sector plummeted, in large part because so much of it had been pulled forward in anticipation of the problem. This threw the economy into a shallow recession starting in early 2001. The governmental response was fairly quick and came in the form of a series of interest rate cuts and a massive tax cut, one aimed primarily at the people paying the highest marginal tax rates.

Then, just as the economy was about to pull out of that recession, the events of 9/11 happened. The direct macroeconomic effects of that were small -- the loss of 2 office buildings, another severely damaged, four airplanes and 3,000 lives lost. The indirect effects -- mostly the fear that if it happened once, it could happen again -- were much more serious. People cut back on travel significantly, hurting the airline and hotel industries. Much of Wall Street had to relocate to mid-town, at least temporarily.

The country had to respond. We did so first by invading Afghanistan, which was the country that harbored the people who attacked us and refused to turn them over. We did so in a half-hearted way, and as a result the people who attacked us were able to slip away. We invaded Iraq, which had nothing to do with the attacks but was headed by a world-class jerk -- one who held a grudge against the U.S. and who we feared might be inclined to attack us. That we did not do half heartedly. While we went to war, another massive tax cut, again aimed at the rich, was passed. That danger of having no Federal debt outstanding was safely defeated. 

Unemployment never got to horrendous levels in the 2001 recession, but it led to a weak recovery, particularly in terms of net job creation, but the percentage of people in the work force was no longer growing, which helped keep a lid on the unemployment rate.

Housing Boom Turned Housing Bubble

The low interest rates greatly helped the housing sector. With house prices rising, people were able to tap the new found housing wealth and consume it through refinancing, second mortgages and home equity lines of credit. Housing prices soared, but as they did, a strange thing happened -- in aggregate the percentage of equity people had in their homes did not go up. Normally with a leveraged investment, if the price rises, the amount of debt remains the same, so the equity portion soars.

In the housing bubble, though, the country was pulling that equity out as fast as it was being created. Since “real estate only goes up" people were using more and more leverage to buy it in the first place, once bought it was used as an ATM machine.

The tax laws that make only mortgage interest tax deductable, but not other forms of interest deductable, certainly encouraged this behavior. After all, it seems to make a lot of sense to pay 6% interest that is tax deductible on your mortgage instead of paying a non-deductable 18% rate on your credit card. What does not make sense, though, is borrowing for 30 years to payoff a dinner at TGI Friday’s, which is essentially what people were doing when they refinanced their homes (or used a home equity line of credit) to pay down their credit cards. After 9/11, the government told us that the most patriotic thing we could do was to go shopping...and we did.

Unlike other recessions, housing never really suffered in the 2001 recession. In the recovery, it was clearly the leading area, greatly assisted by a boom in consumer spending. Median incomes were not rising, but rising housing prices provided a substitute. If the price of the underlying asset is going up and you pull out some of the equity, you are not worse off. Rising home prices attracted more and more speculators, causing even faster appreciation in housing prices.

However, the U.S. is generally not land-constrained (at least outside of some major cities), and the higher prices for existing homes set of a boom in building new houses. Between December 1999 and January 2007, there were 1.028 million new jobs in construction created, or more than one in five total new jobs.

Elsewhere: Weak Jobs Recovery

Outside of construction, and some related financial areas like mortgage finance, the economy was not creating a lot of jobs. It was not producing much in the way of higher incomes for the majority of Americans (total compensation went up more than wages, since an ever-growing proportion of the total comp package went to benefits, most notably health care. Higher employer contributions for health care insurance, especially ones that go to cover higher health care costs, not reducing employee contributions and co-pays, do not leave more money in workers pockets to pay their mortgages.

Housing prices in the long run are going to be largely a function of two things -- incomes and rents. Income, since mortgage debt has to be serviced out of income, and rent, because renting a house is a reasonable substitute for owning a house. At the height of the bubble, the price of housing was way out of whack with historical norms relative to both. Innovative financing like teaser-rate adjustable mortgages hid the income side of things for awhile.

Creative Financing Takes a Toll

In a sense, it was a decade in which the creativity of our financers and accountants exceeded the creativity of our inventors and artists. Creativity is an admirable trait, and one that is greatly needed for the economy, but it is not a good one for accountants to have. I would also argue that it is a greatly overrated virtue when it comes to finance. The financial innovations of the past decade, mostly endless permutations of derivatives like futures and options, and expanding of the range of assets that they were applied too, mostly have not worked out all that well.

Many of these (but not all) were tied to housing. As long as the price of housing was going up, the mortgages, and hence the derivatives on those mortgages, were almost all money good. After all, even if the homeowners ran into cash flow problems and thus could not pay the mortgage, they always had the option of either refinancing (and thus using previously built-up equity to pay current carrying costs) or selling the house, and doing so at a profit.

And Then...the Bubble Pops!

As soon as housing prices started to fall, things started to go bad in a very big way. Cash flow problems lead to defaults and foreclosures as soon as the sell or refinance options go away due to falling prices. If you owe more on a home than it is worth, then it is economically rational to simply default on the loan and lose the house.

All the players in the mortgage market, which by this time included every major bank and investment bank, as well as Fannie (FNM) and Freddie (FRE) was standing in front of a tsunami of bad debt. This led to a massive bailout of Wall Street. Had this not occurred, the dominos were all lined up for a cascade of financial failures which would have plunged the world into a second Great Depression.

The Great Seize-Up

At the end of last year, the financial system was completely frozen, and even letters of credit were not being honored. That can be more effective in shutting down world trade than a fleet of submarines roaming the oceans and sinking ships. Unfortunately, many of the people who were at the heart of the failures that led to the crisis were the ones who benefited the most from the bailout.

The net result was essentially the worst decade this country has seen economically since the end of WWII. Taken as a whole, there was zero net job creation for the decade. Each of the previous two decades had seen cumulative 20% growth in total payrolls, and even those were slowdowns from earlier postwar decades. Total payrolls expanded by 27% in the 1970’s and by 31% in the 1960’s. Industrial production (as measured by the industrial production index) was unchanged between the beginning and the end of the decade. The average gain for the prior six decades was 49.3%, and the previous worst decade was the 1980’s when the industrial production index gained “only" 20% over the 10-year stretch.

We had the lowest cumulative growth in Real GDP during the decade -- 17.8% -- by a very large margin. The next lowest growth decade was the 1980’s at 34.9%, and both the 1990’s (38.6%) and the 1970’s (38.1%) produced cumulative growth of over 38%, while the 1950’s and 1960’s saw cumulative growth of over 50%. Real household net worth actually declined by 4% over the course of the decade, mostly due to a very weak performance by the stock market and the fall in housing values towards the end of the decade.

While household net worth data does not exist for the 1940’s and 1950’s, the prior four decades all saw real household net worth rise sharply over the course of the decade. The next weakest performance was the 1970’s where real net worth was “only" 28% higher at the end of the decade than it was at the start. The 1960’s and 1980’s both saw gains of over 40% and the gain in the 1990’s was 58%.

The 00's One Bright Spot: Inflation

The one area where the economy was successful in the last decade was on the inflation front, with the headline rate of the CPI rising at its lowest total level for a decade since the 1950’s (up at a 2.84% annual rate, vs. 3.45% in the 1990’s, and 2.90% in the 1960’s and 2.47% in the 1950’s. The 1970’s were by far the worst inflation decade with an average of 8.24% on a headline basis).

Core inflation data does not exist for the 1940’s and 1950’s, so we can safely say that the 2.36% average rate for the 00’s was the record low -- well below the 2.88% rate for the 1960’s, which was the second lowest, and less than a third of the 7.53% average rate for the 1970’s. On average, inflation was also a fairly big problem in the 1980's, with an average headline rate of 5.67% and an average core rate of 6.34%, but we ended the decade at rates which were far below the rates we started the decade.

Market Performance Takes a Hit

Not surprisingly, given the poor overall economic performance during the decade and the lofty valuations it was trading at back -- when we were partying like it was 1999 (because it was), it proved to be a very bad decade for the stock market. We ended the decade with the S&P 5000 at 1115.1 down 24.1% from the 1469.25 level we started the decade at. The 1990’s had seen the market more than quadruple from the 353.40 level it started at, and that came on top of a more than tripling in the 1980’s which started with the index at 107.94. Even the 1970’s produced a 17% gain over the course of the decade, although most of that gain was eaten up by inflation.

Looking Ahead

It strikes me that we can do a lot better as a country than we have done over the last 10 years, and it is highly likely that we will do so. Clearly the country has big challenges in front of it, but we have overcome big challenges in the past. I therefore feel little nostalgia for the decade that we are leaving, and have hopes that the decade to come will be much better than the one we just left.

Company Description

Bristow Group provides helicopter services to the offshore energy industry, worldwide. The company provides transportation, maintenance, search and rescue, and related services to companies with offshore drilling platforms.

Estimates are Steady

Right now the estimates are unchanged since the original feature. However, the company has streamlined its operations, which could lead to reduced costs in the future.

Also, 2 analysts reaffirmed their projections for this year and next year, in the past couple weeks. While these forecasts are unchanged, both years from both analysts are above the current Zacks Consensus.

The Chart

After the November 27th feature, shares of BRS broke through a key level of resistance. The stock has a great upward tread going right now and valuations remain cheap.

November 27th Feature Here

Last Week's Aggressive Growth Zacks Rank Buy Stocks

Trina Solar Ltd. (TSL) continues to soar on upward estimate revisions after announcing excellent quarterly results. Read Full Article.

Bio-Reference Laboratories (BRLI) is setting new 52-week highs following its record-breaking quarter.

Read Full Article.

Hi-Tech Pharmacal Co (HITK) estimates are surging following the latest earnings report, which showed earnings rise more than 600%. Read Full Article.

Bill Wilton is the Growth Stock Strategist for Zacks.com. He is also the Editor in charge of the market-beating Zacks Growth Trader serviceZacks Investment Research

I know some are reluctant to buy stocks making new 52-week highs. If you're one of them, have you ever asked yourself why?

If a stock is making a new 52-week high, isn't that a good thing? Just like a stock making a new 52-week low is bad thing.

I'm pretty sure that a person who dislikes buying stocks making new 52-week highs wouldn't be too upset if the stock he already owned broke out to new 52-week high.

And why should he? Statistics have shown that stocks making new highs have a tendency of making even higher highs.

These are the stocks we all dream about. Get in and watch it continue going up.

Of course the fundamentals need to be there. And you should keep a watchful eye on valuations. But if you were in a stock making new highs and cheering it on, it seems silly to be afraid of one doing the same just because you haven't bought it.

One question I like asking myself just to put things into perspective is: if I was in it, would I be excited and would I still want to be in it? If the answer is yes, then I'll look for the best opportunity to get in.

If the answer is no, I'd want to take profits, then I'll move on.

This topic actually reminds me of a question someone asked me a while ago about a stock I was talking about that was at a new 52-week high - in fact, it was at a 5-year high.

He asked, "Aren't you worried about buying a stock at a 52-week high?" I said of course not. So it just made a new 52-week high. That's great news! Guess what -- last year it made a new 52-week high as well. And the year before that. And the year before that.

Can you imagine all the money you'd be leaving on the table if you were afraid of being in stocks every time they made a new high?

Case closed.

:)

The screen I'm running today looks for:

• Stock trading within 5% of their 52 week high. The expression looks like this:

  Current Price/52 Week high >= .95

  That means these stocks are either at a new 52-week high, or have just hit it and still trading within 5% of it, or are climbing towards their 52-week high and are within striking distance.

• Zacks Rank less than or equal to 2
  Only Zacks Strong Buys and Buys.

• Price to Sales less than or equal to 1
  A Price to Sales ratio of 1 means you're paying $1 for every $1 of sales a company makes. A P/S ratio of less than 1 means you're paying less than $1 for every $1 of sales a company makes. I have found that by looking at stocks with a P/S ratio of less than or equal to 1 helps me find stocks that are still considered undervalued -- even if they are making new highs.

• Current Avg. 20 Day Volume > Previous week's Avg. 20 Day Volume
  In short, this helps me find stocks where the volume has increased in the recent week vs. the previous week. If the price is climbing on increased volume, that shows increased demand or buying coming in. And the more buying demand there is for a stock, the more it should climb.

• All of these parameters are applied to stocks >= $5 with Avg. daily volume of >= 100,000.

Here are 5 stocks that made it thru this week's screen for 12/29/09:

AIN Albany International Corp.
CAG ConAgra Foods, Inc.
FUL H.B. Fuller Company
ODSY Odyssey HealthCare, Inc.
UVV Universal Corp.

Get the rest of the stocks on this list and start using this screen in your own trading. Or create your own strategies and test them first before you invest. Know what to buy and when to sell.

Click here to begin a 2-week free trial to the Research Wizard.

Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material.

Disclosure: Performance information for Zacks' portfolios and strategies are available at: http://www.zacks.com/performance.

Zacks Investment Research