Manulife Financial (MFC) – “Coming Out of the Blue” (Again)!

I have been keeping an eye on Manulife Financial and finally yesterday, the stock had a positive transit of EBV-3.

Here is last night’s model price chart of Manulife.

Manulife Financial with weekly price bars, EBV Lines (colored lines) and model price (dashed line)

Manulife Financial with weekly price bars, EBV Lines (colored lines) and model price (dashed line)

For those interested, a daily updated chart of MFC subsequent to this post will be maintained on Facebook, here.

I wrote a blog on March 15, 2012, when Manulife had its first positive transit above EBV-3.  Here is the model price chart that I included in my blog.

Manulife Financial with weekly price bars, EBV Lines (colored lines) and model price (dashed line)

Subsequent to this blog, in early May, Manulife transited back through EBV-3 giving investors a sell signal.  It is important for investors to sell, if not substantially reduce their positions when there is a negative transit.  Why?  One never knows how far the stock will fall and the duration of time the position will trade under EBV-3, if the stock ever re emerges – above EBV-3 – at all.  Also, investing in stocks is about risk and reward, in my opinion there is just too much risk in owning a stock trading below EBV-3.  For investors that buy stocks “in the blue” and they subsequently have a positive transit above EBV-3, these investors deserve whatever rewards they receive because, in my mind they took maximum risk to obtain said rewards.

Why are we drawing your attention to “Coming out of the Blue” stocks?

For over fifteen years we have seen this phenomena.  Stocks that transit up through EBV-3 and over a period of 2 to 5 years trade as high as EBV+5.  These are secular trades that investors can sit back and wait for good things to happen, and they usually do.

Bonus – Highlight of Sun Life Financial

Since I’m on the subject of Canadian insurance companies, back on February 28, 2012 I highlighted through a blog Sun Life Financial “Coming out of the Blue”.  I have reproduced the model price chart that I highlighted when Sun Life had a positive transit up through EBV-3.

Sun Life with weekly price bars, EBV Lines (colored lines) and model price (dashed line)

Here is last night’s model price chart of Sun Life Financial

Sun Life Financial with weekly price bars, EBV Lines (colored lines) and model price (dashed line)

Sun Life Financial with weekly price bars, EBV Lines (colored lines) and model price (dashed line)

For those interested, a daily updated chart of SLF subsequent to this post will be maintained on Facebook, here.

Since my blog post, highlighting the positive transit of EBV-3, SLF has appreciated some 35%, with dividends.

2 responses to “Manulife Financial (MFC) – “Coming Out of the Blue” (Again)!

  1. John Boyce January 3, 2013 at 3:09 pm

    manulife seems to be going up penny by penny but seems to be gaining some momo towards breaking $14,financials my largest holding with manulife, bank of america, and first niagara bank. Am learning lot and 1st site to give me clear buy and sell targets aside from using technicals (moving avgs,macd etc) which I don’t use a lot, thx again

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