Our Discipline: Unique And Thorough

There are many steps involved in determining what stocks we want to own, and when to sell them.

Our first step is to determine what company fundamentals investors are beginning to reward. We look at 65 fundamental criteria on over 6000 domestic stocks. From this data we are able to determine which of those criteria are being highly sought after by Wall Street now. We then use computer modeling to learn which stocks contain the most desireable combination of these criteria.

We then perform a style analysis on the market. Here we watch for trends in nine market capitalization ranges, three style groupings, twelve sectors and 100 industry groups.

Our goal is to take only as much risk as necessary to acheive the expected return from our stocks. Careful Reward/Risk controls are applied to the universe of stocks so that only those stocks with high potential reward and lowest risk make it to the next step.

Next we narrow the universe of stocks to a buy list of 300 which we call the "SuperStock" list. To this list we apply rigorous due diligence to create a list of the 150 most attractive stocks based on our fundamental research, reward/risk profile and style analysis.

Using a sophisticated optimization process we narrow the list to just 50 stocks. These stocks have the strongest combination of the fundamentals, the style analysis and present the greatest ratio of reward to risk. Our final buy candidates are selected from this list by determining which best compliment the existing stocks in the portfolio.

For a more detailed understanding of our strict discipline go here.

Quantitative, Objective, Consistent, Disciplined - Simply Smarter Investing