Market Smarts

Graduate student's newsletter offers an accurate analysis of the Dow Jones Industrial Average

By Mark Sullivan
Contributing Writer

Other kids would grab the comics or the sports section, but as a boy John Halstead reached for The Wall Street Journal . Now a student at Carroll Graduate School of Management, Halstead does more than read the financial news - he publishes it.

Halstead authors his own stock market newsletter, Halstead's Market Analyzer , which he launched three years ago as a sophomore at the University of Connecticut. The free publication is probably the only one of its type to have been founded by an undergraduate student, he claims. While he does not foresee the Analyzer joining the ranks of established business journals, he enjoys playing the role of financial pundit.
Master's degree candidate John Halstead, publisher of Halstead's Market Analyzer. (Photo by Lee Pellegrini)

"I like analysis, finding out why this is happening," said Halstead, who is studying for a master's degree in finance. "A lot of people believe the market is not predictable ... They're using the wrong data."

The quarterly newsletter attempts to forecast the direction of the Dow Jones Industrial Average and grades as many as 180 individual stocks, based on a computerized system of Halstead's design. His rankings consider such factors as a stock's movement, earnings growth and relative strength on the overall market in the rankings.

"I strive for accuracy, I don't strive for hype," said Halstead, who is considering pursuing a doctorate in finance, then working for an investment firm.

"His predictions have been very good and have come fairly close to what has actually happened," said Assoc. Prof. John Preston (CSOM), whom Halstead serves as a graduate assistant.

The Analyzer clearly is written for the financial expert, with its tightly packed prose on price oscillators, weighted momentum indicators and flattened yield curves. The most recent issue, published in late August, forecasts a rise in overall prices over the next three months and thus far the prediction seems correct: Over the past 10 weeks, Halstead claimed, the stocks rated highest in the August issue have increased in value by nearly 28 percent.

Halstead can sound much the same in conversation as in the pages of the Analyzer. During a recent interview in a Fulton Hall study lounge, the bespectacled Halstead - clad in non-Wall Street garb of windbreaker, white socks and black work shoes - peppered his talk with animated references to P-ratios and market breakouts.

A fascination with the vagaries of the stock ticker came early to Halstead, who said he inherited his interest in finance from his father, a private investor. He acknowledges, with a laugh, his boyhood attraction to the Dow Jones was "pretty unusual." One of his most vivid childhood memories, for example, is of the Crash of 1987, when the stock market fell more than 500 points in one day.

Halstead was not yet out of his teens when he began publishing his own stock-market analyses, which won praise from one of his professors at the University of Connecticut, Lewis Mandell.

"I've read his newsletters and they're certainly as good as many out there that people are paying hundreds of dollars a year to receive," said Mandell, now dean of the College of Business Administration at Marquette University.

Halstead figures he spends less than $50 on printing and mailing each issue, and estimates the current circulation at about 100. He said the newsletter has been available in 22 Connecticut libraries, and is sent to a few individual and institutional investors. Halstead added that he will seek an arrangement with O'Neill Library to display the Analyzer .

The next issue of the newsletter is planned for late fall, Halstead said, and persons interested in getting a copy may contact him by e-mail at halstejo@tony.bc.edu.

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