• Follow Free Cash Flow Not EPS

    Momentum in earnings is a simple and effective investment idea. A company’s profitability can be described by EPS and FCFPS. Momentum in FCFPS lets investors select stocks with higher potential return than momentum in EPS.

  • Trade On Momentum In Prices And Price Targets

    Price Target is one of the most popular indicators that investors pay close attention to. Implied Return is the return an investor would receive if they were to buy the security at the current price, and the price then increased to the Price Target level. If the current price of the security is increasing and the Implied Return is increasing as well, this may be a good time to purchase. If the current price of the security is dropping and the Implied Return is dropping, this is not a good time to open a position.

  • The Santa Claus Rally Is Coming

    Santa Claus rally is an annual stock exchange that happens at the end of the year. The phenomenon has been a topic of heated debate between market participants. There have been many attempts to figure out the reason behind this phenomenon, but nobody has been able to arrive at a satisfactory explanation. Santa Claus rally has different levels of impact on different industries.

  • 3D printing - is it time to invest?

    The 3D printing industry is rapidly developing. 3D printers are used in many fields, from clothes and furniture to biotechnology. There is a lot of potential in 3D printers, but using them for mass production is currently associated with very high costs. From an investor’s point of view, the 3D printing industry does not look appealing. The current state of affairs may change drastically in the near future.

  • How To Cash In On Inflated EPS Forecasts

    Earnings surprise can have a big impact on a company’s stock price on the reporting day. Loss-making companies with positive EPS forecasts have a much higher probability of negative earnings surprise than other companies. However, this fact is already priced in by the market, which is why expected returns are higher for these companies on reporting day. This effect is most persistent in Industrial, Health Care and Information Technology sectors; the anomaly doesn’t hold for Utilities sector.

  • What Are Market Favorites Worth?

    Market favorites are securities that are trading at high valuation for a long time and consistently post price growth. Purchasing securities considered to be market favorites can bring good returns. But it’s difficult to distinguish a real market favorite from a bubble. Clear signals that indicate a security is most likely a bubble include high levels of investment and inflated expectations for future growth.

  • Advice For Momentum Strategies

    Momentum investing is an investment strategy that aims to capitalize on the continuance of existing trends in the market. Value investing is a strategy of selecting stocks that trade for less than their intrinsic values. Growth investing is a strategy whereby an investor seeks out stocks with what they deem good growth potential. Combining all three approaches is the way to find good stocks to include in portfolio.

  • Sales Growth Generates Alpha

    The goal of any business entity is to make a profit. A company’s ability to consistently increase revenue amounts is highly valued by investors. Stable revenue growth serves as confirmation of a company’s strong position on the market and the ability to meet financial obligations and pay dividends. Reduced rates of revenue growth or a drop in revenue serve as negative signals for investors, making company shares less attractive. Using sales growth as a criterion for selecting stocks is the way to generate alpha.

  • Protect Your Portfolio Against Risks

    Uncertainty in the market is increasing, which means that investors want to insure themselves against risks. Hedging is one way to protect a portfolio against losses. Hedging with options is a popular method that has a lot of shortcomings. A market-neutral portfolio is a hedging method in which the distinguishing feature is the lack of correlation with the market. A market-neutral portfolio enables investors to make a profit when the market takes a nosedive, but this method has to be used carefully.

  • Glamour Stocks. Part 2.

    Turnover/Market Cap ratio is a useful indicator for determining "glamour" or "hot" stocks. Turnover/Market Cap ratio captures key trends such as a decline in commodity prices or a mortgage crisis and points out stocks that don't belong in the "hot stocks" category. Hot stocks generally come from the Information Technology, Healthcare and Consumer Discretionary sectors. "Boring" stocks by Turnover/Market Cap ratio from above-mentioned sectors show greater risk-adjusted returns than hot stocks.

  • “Glamour stocks”: yes, no, maybe?

    Buying company shares is one of the most popular ways of investing money. The investment doesn’t have to be too large (like with real estate, for example), it also allows people to make a significant profit (unlike bank deposits) and yields results faster than an investment in education or health. The buyer only has one major task – picking the right shares to purchase. The vast majority of people are convinced that the best way to make money is to buy shares from popular companies. Is this actually true?

  • Version 1.3

    Version 1.3 List of updates

  • Version 1.2

    Version 1.2 List of updates

  • Fundamental Analysis – a tool for understanding the market

    Why is it so important to look at companies' fundamentals?

  • Version 1.1

    Version 1.1 List of updates