Friday, February 25, 2011

Your list of screened stocks Part 2

What edge do you get from your list? Screened stocks are lists that anyone can easily get. Is that necessarily bad? For the sake of this post, let's explore other options.

What is a more unique step?

I have tried these:
Come up with a unique value metric, TA, or theme no one has heard of, or discounts.
Actually do the hard work of a FCFF/FCFE evaluation. No short-cut here.
Do a Sector analysis. How long do sectors stay in favor?

I have not tried these yet:
Do a Qualitative analysis approach. Are there screens for that?
Do Macro themes. Not the 24-hour news cycle stuff, but trends that you think will last longer than 1 year.
By the way, how did we go from deflation worries to inflation fears without resting for awhile in the neutral zone? ....but I digress.

Both fast money & slow opportunity options.
I will never have the resources that larger funds have, but I can create unique opportunities.

I want to come up with a short-cut for something that needs a unique approach. Maybe that's a waste of time. Maybe homework/hard choices is the answer. After a month, I find that if I don't believe in the list, then I probably would have been better off using a screened list instead.

That's my amateur guess.

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