Strategic Properties (BEE) and Roberts Realty Investors (RPI) Follow Maguire (MPG)

• Ian Wyatt
• On 5:00 pm EDT, Tuesday September 29, 2009

I've been discussing how investors can use the "Most Price % Change" list published on Yahoo! Finance to find worthy stocks that will start making money for you in the near-term, and hopefully in the future as well.

 

Of course, not every stock that shows up on the "Most Price % Change" list is investment worthy. It's too harsh to say the majority of stocks that show up on this list are "pump and dumps", but if you watch the list for a while, you'll notice that one day's top gainer is the next day's top lower. In other words, many of the stocks that make the "Most Price % Change" are reacting to news that will only affect the price temporarily.

 

I lump all biotechs into this category. Of course, that means I miss a few biotechs. But I am not a doctor. I can't speak to how important a particular drug might be. And besides, news from biotechs about the results of a drug trial is never a surprise. Investors are always holding the stock in anticipation of that news. I do not want to be buying while they are selling.

 

The key to using the "Most Price % Change" list is to be able to discern the relatively few stocks that are moving on fundamentally important news from the majority that are moving on temporarily important news. Trust me, this skill is not instinctual. It can be learned.

 

You can find some of my criteria on using the "Most Price % Change" to find small cap stocks that are experiencing fundamental change and a subsequent fundamental revaluation (read: price moving higher) HERE.

 

Today, I need to add another item to the list: Pay attention to sector trends.

 

Now, as you know, I zeroed in on a commercial real estate REIT a couple weeks ago called Maguire Properties (NYSE:MPG - News). I started talking about it as an investment worthy stock when it was trading around $1.30. Today, it's trading for $2.25, and it's been as high as $3. But ultimately, the point is that it has sustained and increased the gains that put it on the "Most Price % Change" in the first place.

 

And you can find stocks that do that on a regular basis. 

 

Now, when I first saw Maguire Properties, it rang a bell. Not because I knew the stock, or particularly like real estate. It rang a bell because the Fed had recently said that it was focused on finding solutions for the commercial real estate market. Hmmm, I said to myself, here is a commercial real estate REIT jumping higher in big volume...

 

Sure enough, a couple days later, there was Maguire, again on the "Most Price % Change" list. But this time it was accompanied by another commercial real estate REIT Strategic Properties (NYSE:BEE - News).

 

When I checked the "Most Price % Change" list today around 3 pm, one of the top performers was, you guessed it, another REIT, Roberts Realty Investors (AMEX:RPI). It was up 35% on nearly 10X average volume.

 

It seems to me there is trend developing - commercial real estate REITs are moving. This is a sector trend that might be unexpected, but then some of the most sure-fire investments fail to perform.

 

Another trend I'm starting to see is private equity and business development firms, like CIT Group (NYES:CIT). CIT provides funding for small businesses. And while CIT might be risky, it's up 28% today.

 

Another similar company made the "Most Price % Change" list today MCG Capital (NasdaqGS:MCGC - News), up 17%. I've also seen American Capital Strategies (Nasdaq:ACAS) on the list in the last few weeks.

 

Additionally, there are a couple natural gas/energy issues on the "Most Price % Change" list today. Metrogas (NYSE:MGS) is up 15% and some warrants from Mirant Corp (NYSE:MIR - News) up 10% and 18%. Natural gas and energy are always sectors to watch.

 

Finally, some of the more interesting stocks on the "Most Price % Change" list from yesterday, Monday, September 28, were down slightly today, like

 

Ramtron International (Nasdaq:RMTR), India Globalization Capital (AMEX:IGC) and Tri-Valley (AMEX:TIV - News). I'll be watching these to see what happens...

Buzz up!