How to find good ideas?

1. Theme-based

Look for things like technology advancement, demographic pattern, major macro trends such as inflation, currency, etc. – all the above things are secular by nature 

2. Catalyst change

Look for things like new management, new products, new market entry, regulatory/policy change, turnaround, big size recaptilization, hidden assets, take-out possibilities, insider transaction, etc.

3. “Palm Pilot” system

Look for names analyzed before and be alert when price moves dramatically above or below intrinsic value

4. Under-followed or little-followed companies

5. Controversial or misunderstood stories – contrarian approach with deep fundamental research

6. “Flatten-out” names

 Use quantative screening to find stocks that trade within a narrow range of prices for the most recent months – they most often are soures for # 4 and/or #5 ideas

 7. Spin-off/split-off

CBSmarketwatch.com email alert

Regular reading of sell-side reports or newspaper

8. Sell-side opinion change (contrarian or implication on other opportunities) or initiating reports

9. Trustable sources

Selected VIC members

Barron’s

10. Buy low/sell high

52-week hi/lo

low P/E, P/B, P/CF

Momentum (EPS revision)

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