If a stock triggers one of our sell rules, then it will be removed from our newsletter until it once again approaches a sound technical area for buying. If a stock fails to reach our buy point after several weeks, then it may also be removed from the newsletter. Finally, if a stock underperforms the general market and other stocks, then it may be removed and replaced with a better candidate.
Each week, we screen for stocks with the very best fundamentals, such as high earnings growth and high sales growth. Once we have a list of stocks with the best fundamentals, we screen the chart of each stock to narrow the list down even further. We look for constructive chart patterns that have a high probability of producing big gains. Finally, we research the companies to find out what is driving their recent growth. Our subscribers can bypass all of this research by just reading our weekly newsletter and then deciding which stocks to buy or sell.
Our newsletter is extremely focused so that subscribers do not need to spend a lot of time researching stocks before deciding to buy or sell them. Therefore, our newsletter contains approximately five stocks at any given time.
Our strategy is to take most profits at 20% above our buy point, unless they trigger a sell rule before reaching the profit goal. For example, we may sell a stock for a smaller gain if it does not have enough profit cushion to hold through an earnings report. We may decide to hold a small number of stocks for longer term (and larger) gains. We cut our losses at 7-8% below our purchase price, so we almost never take a loss larger than that. Our historical performance can be found here.
Recent IPOs can significantly outperform the general market and the stocks of companies that are more widely followed. By screening for the very best recent IPOs in terms of fundamentals and technicals, we can place our money at a high probability for growth. Since recent IPOs are not as widely followed as more established large cap stocks, they present an opportunity for individual investors to purchase them before they make an appreciable price move.