October 26, 2017

Investment Green Flags – Decreasing Shares Outstanding

Share Buyback Programs

A company purchasing back its shares tends to increase the stock price for a couple of reasons. First, it shows that the firm and its employees are confident in the direction the company is heading, and second, it cuts down on the shares available for investors to purchase purchasing the price up through basic supply and demand.

Below, we’ve outlined one of our green flag indicators “Decreasing Shares Outstanding” which can be found within our Green Flags Score.

Like all green flags, we want to keep this to be as simple as possible. We are building a piece of a larger score, not an entire screener.…

October 19, 2017

What is your definition of “high dividend?”

How high are “high” dividend stocks?

As the markets continue to lack volatility, a number of investors are attempting to find opportunities outside of the traditional growth stocks. This leads many of them to alternatives such as forex, options, etc. However, some investors are still attempting to find gains in the equity markets, and a number of them are doing so through looking for companies with exceptionally high dividend yields. I have a little experience in dividend investing, but not enough to give my thoughts on the matter without running a few tests.

Above we have created a simple stock screener that ranks all companies in the market based on their dividend yield and returns the top 25% of them.…

October 12, 2017

Investment Green Flags – High F-Score

High Piotroski F-Score

 

A recurring name throughout our software and website, the F-score has been continuously tested under many different circumstances and never ceases to amaze me. It may be simplistic, but, when used correctly, can be a very powerful tool for your portfolio.

For this Green Flag we want to look at the two calculations we have in the system for the Piotroski F-Score – Yearly and Trailing 12 Months. If you are unsure of the difference, the yearly score is based on the most recent annual data, while the T12M relies on the four most recent quarters. This slight difference just means that the T12M score is two-quarters ahead of the yearly score data wise.…

October 3, 2017

How to Long or Short Bitcoin

In a nutshell, bitcoin is either something as monumental as the introduction of the internet or as futile as the tech bubble of the late 90s. Bitcoin has been in the news for quite some time now, and over time, one begins to wonder if this is a bet you should be in on. Yet, perhaps your ignorance of this new asset may hinder you from taking that first long/short position—everyone has got to start somewhere. This article has one sole purpose, and that is to increase your confidence in opening a bitcoin position by going over the procedures and implications of opening a long or short position on bitcoin.

September 28, 2017

Investment Red Flags – Close < 2

Sharing a lot of characteristics with the “Ultra Low Market Cap” red flag, looking for companies with a close of less than 2 gives you a number of companies whose market cap ranges from Micro to Small. These companies tend to have extremely poor fundamentals and also have a high probability of causing negative returns in your portfolio.

For this flag, we collect all companies who have a close of less than two at the time of screening. Now, a lot of marketers sell you the idea that you can make your fortune on these low priced stocks and in some cases that are true.…

September 21, 2017

Investment Red Flags – Micro-Cap Companies

Every time I get on the internet to try and find something new to learn about the markets I’m inundated with advertisements selling classes. These classes all seem to follow the same theme – they teach you how to become “rich” on penny and microcap stocks. Some people even get lucky and make some money doing it, but the vast majority is simply throwing money into a pit. Now let me explain why, and also why we have included microcap stocks in our red flags score.

Keeping with our other flags, we have kept it as simple as possible here by only having one line that simply states the following –

  • Companies whose average market cap over the past year is less than $100 million.
September 14, 2017

Investment Green Flags – Increasing Sales and High Asset Turnover

Revenue Growth and High Asset Turnover

 

When it comes to finding green flags, sometimes the simplest idea is the best. In the case of our flag – Revenue Growth and High Asset Turnover – we look for just that. It’s pretty self-explanatory that if a company is bringing in more money and is selling products faster than anyone else, it will likely increase in price long-term.

In this flag, we’ve kept it fairly simple by looking for the following –

  • Within the past trading year, the total revenues must be larger than they were a year ago. This must be true for all points throughout the year.
September 7, 2017

Investment Red Flags – Bad Beneish Score

How negatively does a bad Beneish score affect your portfolio?

 

With all of the recent articles regarding red and green flags, I realized I should begin writing articles on the flags within the score. One such flag, the bad Beneish score, is a key component of the red flags score.

The line item, “Bad Beneish Score” within the red flags score is calculated by using the above editor.

  • The Beneish M Score over the trailing 12 months (The most recent calculation) must be greater than 0.
  • The Beneish M Score over this past year (Two quarters behind the T12M calculation) must also be greater than 0.
August 10, 2017

Guys, you’re being too selective with your screener

It isn’t uncommon for one of our users to call us up and ask for help. To be honest, there have even been times when I will help a client at their site to get them up and running. In the past two years of working in this industry, I have noticed one major theme among every person(myself included) when it comes to screening for potential investments – we are all far too selective.

What do I mean by that?

Well, when we go in to start building a screen we all have the idea of the “perfect” company. This shrunken world view is just our individual preferences, but it can minimize our potential to make good investments.…

August 5, 2017

Can’t Compare Split Adjusted Prices

If you have been using the Equities Lab system in recent weeks, you may have seen a new error that hadn’t appeared before.

———————————

Stock Server Error:Server Error:Cannot compare split ajusted quantities to constants: greater(Close, 444)

Don’t worry! This error message doesn’t mean that the system is down; it simply tells you that there is a split adjusted value in a place it shouldn’t be.

Have you ever input the following line into a screener?

If you have, you’ll need to change that to the following –

What’s the difference?

  • Close
    • This is the split-adjusted value. When a company undergoes a stock split the value of stock changes, typically by half, and the number of available shares doubles.