Vintcent Strategy.
Source: The Investor’s Guide – Be Your Own Stockbroker by Charles Vintcent
http://www.amazon.co.uk/exec/obidos/ASIN/027364467X/qid=1068164380/sr=1-
3/ref=sr_1_0_3/026-2297028-0123661
1. Establish the overall direction of the market. Consider interest rates, inflation,
exchange rates, and political stability.
2. Carry out sector analysis:
• Is the sector creating demand for products?
• Are prices falling? Is it getting hard to sell?
• What are current market conditions?
• Is the sector likely to grow?
• Measure the share performance against it – share price and PE.
3. Carry out a company analysis:
• What are its key products? Is it achieving 10%+ growth?
• How can the company sustain growth? What is its market position?
• Are the managers credible? Are they liked in the City?
• Is the share’s valuation reasonable?
• What risks does it face?
4. Organic Earnings Growth should be 30% yearly, with growth rate of 50%+.
5. Note the High and Low of the share over the last 12 months. Calculate how far off
its high it is today.
6. Note the latest movement in the price since yesterday.
7. Check Market Capitalisation. Avoid companies of less than £150m.
8. Study share price graph over 3 years using the 30-day and 200-day MAs.
9. Check the Extel report showing the accounts over the last 5 years.
10. Check the Dividend Cover over the last 5 years.
11. Calculate the Dividends over the last 5 years. Look for an upward trend.
12. Look for a positive net Cash Flow record.
13. A share on an upward trend but near the bottom of its trading range is a buy. A
share that has broken through the upper level of its trading range is a definite and
immediate buy. A share on a downward trend in its trading range can be bought
when it begins to turn upwards.
14. For Investment Trusts choose one whose Gross Yield is 5% or more, or whose
price is at a discount to NAV.
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