< How David finds top stocks with buy with ShareAnalysis
“ShareAnalysis provides a rigour that ensures my decisions aren’t influenced by emotions or the noise of the stock market”
Now in his late fifties, David has only recently taken a hands-on approach to his superannuation. He set up his own Self Managed Super Fund (SMSF) just a few years ago.
After a few years of refinement, David has settled on an investment strategy that allocates 28 per cent of the portfolio into medium/long term cash or equivalent holdings, 62 per cent into equities (mainly individual Australian stocks with some overseas shares via a managed fund) and the remaining 10 per cent in cash that can be invested when he uncovers new opportunities.
David describes his investment philosophy as “one of growing awareness, with an increasing reliance on a 'value' approach.”
When it comes to stock picking, David relies on ShareAnalysis.
“I find ShareAnalysis a great way to focus my mind on what should I think about. It also provides a rigor thanks to the incredible 'smarts' of the programming that I can apply every day of every week, all year round. Thanks to ShareAnalysis my decisions aren’t influenced by emotion or the 'white noise' of the stock market.”
After using ShareAnalysis to find a shortlist of stocks to buy, and understand their fundamentals and future growth forecasts, David does a bit of reading. “I read a fair bit of the business press as well as online blogs in order to understand medium-term trends in the economy”, David said.
Throughout the year David also uses ShareAnalysis to regularly review the stocks in his portfolio. “When shares become overvalued I sell the lesser-quality ones. With spare cash on hand, I’m then in a position to buy once a top stocks becomes cheap”.
“I love the Stock List as you can effectively filter very quickly. It also lets me see what stocks are just outside the cut off point I have nominated. As far as Evaluation screens, I love the Summary screen for individual stocks.”
David’s top stocks filter
David uses ShareAnalysis’s filters to identify top quality companies with strong future growth forecasts. He also prefers stocks with low debt and high return on equity, as well as companies whose price hasn’t risen too far above value. Here are David’s favourite ShareAnalysis filter settings:
|Filter criteria||David’s filter setting|
|ShareAnalysis Score||A1, A2, A3, B1, B2, B3|
|Market cap||> 50M|
|Safety Margin||-25% to positive (Really only interested in -10% to positive)|
|Dividend yield (historical)||> 0.5%|
|Return on equity||> 15%|
|Historical change in intrinsic value||> 0%|
|Forecast change in intrinsic value (future growth)||> 10%|
|Forecast P/E ratio||< 25|
|Forecast earnings per share growth||> 0%|
|Net debt / equity||< 75%|
|Cash interest cover||> 2|