Dividend Stocks

The Best Tool to Find Growth Stocks

We all know the story of “The Tortoise and the Hare.” It’s a simple story with a powerful lesson.

A tortoise and a rabbit race each other. The hare thinks his speed and cleverness will make him the easy winner over the slow-moving tortoise. He gets overconfident and decides to take a nap thinking that the tortoise will never catch up to him. Once the hare wakes up, he finds the tortoise is close to the finish line. He rushes to catch up but it’s too late. The tortoise won.

Through hard work and determination, the tortoise did the impossible. He proved that you can be more successful by acting deliberately and steadily … rather than acting quickly and carelessly.

You may be wondering what a 2,500-year-old fable has to do with stock investing. It’s simple – when you’re a growth investor, the last thing you want to be is the hare. You don’t want to hit the snooze button while the market steadily rises. At the same time, you can’t react simply because of a headline or blip in the market.

There are a lot of “hares” out there. And they’re their own worst enemies. They’re the last to spot buying opportunities – they wait too long to buy. They’re the first to panic when the going gets tough – they sell too quickly. For them, stock investing is a source of constant stress and anxiety.

On Wall Street, the tortoise is a much rarer breed. Their movements are carefully planned. They identify the best buying opportunities early, but only after they’ve carefully vetted them. They commit to a strategy that’s based on cold hard data rather than emotion. And, when speculation runs rampant, they consider the facts before selling.

As a long-term quantitative investor with a heavy focus on fundamentals, earnings and sales growth, I view myself as more of a tortoise. I dig deep into the numbers and see if a stock truly has staying power. If it does, I may invest and hold for the long term. If my research shows that it does not, I won’t touch it with a ten-foot pole, even if all of Wall Street is dazzled by it. On the flip side, if a stock’s fundamentals start to turn, I’ll sell.

To help find the best stocks, I used my proprietary system Portfolio Grader, a tool I’ve discussed a lot in previous Market 360 articles (you may have even used it yourself). Well, today, I’m excited to announce that I have upgraded Portfolio Grader to my brand-new Stock Grader. And in today’s Market 360, I’d like to show you what Stock Grader looks like and how you can use it to find fundamentally superior stocks in any market condition.

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