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Strategic Investing

A Service of Adrich Corporation

Strategic Investing focuses on stocks with increasing revenues and profits.
KISS + SF!

What is Growth Investing?

The Strategic Investing philosophy relies upon fundamental concepts of investing pioneered by Graham and Dodd in their book, “Security Analysis” as well as the criteria developed by Ernest Zahn, Armand Erpf, Ralph Hansmann, Malcom Smith, Ian Woodard, Marc Chaikin and others. Our portfolio selection criteria requires companies to have sales and earnings growth, institutional sponsorship, and meet certain other conditions.

Stock ratings

Stock ratings enable the investor to quickly separate stocks that might be able to show improvement in their stock price.  There are several methods for evaluating the multitude of stocks available using online tools and resources .  Several publicly available investment data services provide some variant of the following classical investment measures. While the services calculate their measurements with modest differences they generally simplify the data for the user by classifying measurement performance into groups or ranges.

Measurement    Description     Range
Accumulation/
Distribution
   Uses a price and volume formula to determine if a stock is under accumulation (buying) or distribution (selling) in the last 13 weeks.     The top quintile (sometimes called A) signals heavy buying; the lower quintile (E) is heavy selling.
Earnings
Per Share
   Compares a company's last two quarters and last 3-5 years of growth and stability with those of all other companies.     As typically calculated by data providers, a 90 rating means a stocks earnings outperformed 90% of all companies.
Relative
Strength
   Measures a stock’s relative price change in the last 12 months vs. all other stocks in the dataset.     The best companies rate 80 or more on both EPS and RS on a scale of 1 to 100.
Overall    Combines multiple ratings to get an overall picture.     EPS and RS usually receive more weighingt, although a stocks’ percentage off their high price also is considered. Data provider ratings are usually from 1-99, with 99 being best.

It is easy to buy stocks but the most important aspect of successful investing is knowing when to sell

The development of Action Points as selling criteria allows investors to concentrate on retaining profits while reducing losses. 

However, the choice of a selling trigger should be dependent upon each individual's determination of a risk/reward ratio coupled with a GNS (good night's sleep) factor.


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Last updated - January 14, 2014

 

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