An ideal beginning and a recap

The first year of Value Research Stock Advisor is over. Looking back, it feels like a big milestone. However, I also remember the day - so many years ago - when we had reached similar milestones in Wealth Insight and Mutual Fund Insight, and I realise that Value Research Stock Advisor has a long way to go.

Although we didn't plan it that way, this year has turned out to be the best 'Year One' that such a service could have had. It's true that the markets have retreated sharply, and many investors are a bit circumspect. But that's good news. This time last year, my greatest fear was that the equity markets would keep rising and our pioneer customers would end up investing at rich valuations. Or despite our research team having built a great roster of stocks, we wouldn't be confident of the prices at which these great stocks were available. Neither of these fears have come true.

Of course, in the long-term, markets go up and they go down and it all evens out. However, buying at good values is certainly a good way to start using Value Research Stock Advisor.

For those of you who are not yet familiar with this service, let me give you a recap.

What exactly will I get?
Unlike many of our other products, this is a purely web-based service, which you access through www.valueresearchstocks.com. There is no print equivalent that will be shipped to you.

On the website, you get access to our list of recommended stocks. Some of them are classified as "All-weather stocks". All-weather stocks are stocks that we expect you can hold for a long time. The advantages these stocks have are fundamental in nature and we don't expect them to become unworthy of ownership for years. And years. And years. Of course, the point of holding a stock is growing your money. We expect our all-weather stocks to do better than the rest of the market and the economy in a sustained manner.

New recommendations
We aim to issue new recommendations every month and have done so till now. There could be some all-weather stocks too. We say 'aim' because if there's nothing worth buying at a juncture, then we will not issue a recommendation. Unlike those who have something to sell, we will rather keep quiet when it's time to be quiet. However, based on our experience, we expect to make roughly 20 to 25 recommendations every year. Last year, we launched with 10 stocks on our buy list. At the end of the first year, this list has thirty stocks.

A detailed thesis
Along with the recommendation, our research team will publish a detailed investment thesis on why a particular recommendation was made. Of course, you are free to ignore the thesis and just go ahead and buy a stock. However, we strongly urge you to read the entire write-up and give it some thought. The reason is that it's this detailed thesis that will give you conviction and take you on a walk-through of our thought process in recommending each stock.

As markets fluctuate, there will be times when you might feel a little uncertain about a stock and that's when the conviction will play a role.

What about other updates?
Our team keeps continuous track of companies that we have recommended from all perspectives. This includes financials, operations, the news environment, the regulatory environment and other external events. On the markets side too, we keep track of price and other variables. Based on these, we issue updates whenever necessary. When there's an update, we notify all our investors through email.

How are these recommended stocks chosen?
Our research process is geared towards finding great companies for you while eliminating the possibility of a poor stock getting recommended, since both these aspects are equally important in identifying profitable investments.

The process starts with continuous algorithmic monitoring of about 4,500 companies. Our systems monitor many financial and proprietary non-negotiable parameters for these companies. The monitoring generates signals based on business growth, consistency, profitability and financial strength. Based on these signals, we filter down the 4,500 companies to about 120, which can be considered as tentative investment candidates.

Next, we apply our stage 2 filters to this short list. These are a set of 14 quantitative and 16 qualitative parameters that our research team has developed based on our experience over the last decade with Wealth Insight. After applying the stage 2 filters, the list is narrowed down to about 50 stocks.

At this stage, our team begins intensive qualitative study of the soft factors that impact the future of any company. Our analysts study the management's track record, growth drivers, valuations, concerns and a variety of other factors. After evaluating these factors, we select companies that are worthy of investment. We take the final investible list and examine the valuation at which the stock is available currently. Those that are available at a good value are communicated to you.

Who does this research?
The research is done by a dedicated team of in-house analysts. Obviously, all members of the team conform to SEBI's regulations for equity research analysts. For members of the service, full information about each analyst (including what stocks each analyst has invested in) is available.

What kind of investors is this service suitable for?
Value Research Stock Advisor is suitable for anyone who wants to create wealth through investing in equity. You are especially suited for using this service if one or more of these conditions fit you:

· You are tired of the commission-driven, short-term trading that brokers make you do.
· You want to invest for the long-term in robust companies that will stand the test of time. But you do not have the time and resources to research the thousands of stocks that are listed.

Having said that, you do need a certain scale to invest in this manner. You probably need investing capital of at least `10-15 lakh available for at least five years. Below that scale, you may not be able to take full advantage of what we have for you.

Wait, there's more!
Quite apart from the recommendations, our service comes bundled with the best online data and tools for stock research that are available today in India. The best part is that these are not limited to our recommended stocks. Instead, they are available for your own research on any listed stock!

Stock Screener: A unique custom research tool
With our Stock Screener, you can create your own stock screens and test out your investment ideas. Your stock screens can use any of the 72 parameters and ratios that are available for all stocks.

We also have a number of invaluable, pre-configured custom stock screens that you can use as is or as starting points for your own research. These are:

· Five 'Value Guru' screens that simulate what five great value investors would do
· Seven stock-ideas screens, tried and tested for years
· Eight 'seasonal' screens to X-ray current opportunities

Stock Snapshots and Essential Checks
For each stock listed in India, we have 60 financial parameters and ratios going back five years. Not just that, you also get access to our exclusive 'Essential Checks' system for each and every stock.

If you are interested in a stock, there's no better way to initiate your research than our 'Essential Checks'. They'll quickly, at a glance, give you the answer to these questions:

· What is the likelihood of this company becoming insolvent?
· By fundamental measures, how well has this company done in the recent past?
· Is there any creative accounting going on in the company's books? That is, should you suspect the company of somehow trying to show better financials than are justified?

Without Essential Checks, there is no easy, quick and measurable way to answer these questions.

What about my existing portfolio? Will I get one-on-one advice?
Giving specific advice to individuals is not part of our service. However, the extra tools that we have discussed above are meant for exactly that purpose. Essential Checks and the Stock Snapshot should give you plenty of insights on the stocks that you own.

What is the difference between Wealth Insight and Stock Advisor?
Wealth Insight gives you data, analyses and other inputs for choosing your own investments. On the other hand, Stock Advisor chooses investments for you. Additionally, it has a wealth of interactive digital tools that a printed magazine cannot have.