In a perfect world, we would have just one small list of stock recommendations and you would just gradually build positions in each of those stocks. As time goes by, you would have a nice cost-averaged portfolio, ideally positioned to generate outsized returns as their value increases.
However, as equity investors know better than anyone else, the world is not perfect. As time goes by, profits go up and down, business prospects improve or decline, pandemics come and (hopefully) go, and thus stocks become more or less attractive. It's notable that when stocks become more or less attractive, this is often not a permanent situation. Stocks change their attractiveness far more often and more quickly than the fundamental desirability of investing in them.
This is exactly where the subsets of our recommendation system come from. Let's examine the different sets of stocks that you will have access to as a member of Value Research Stock Advisor.
The recommended stocks are our master 'buy' list. All other groups are a part of this. Our stock recommendations are the result of a multi-step process that starts with continuous monitoring of a large number of listed stocks, detailed evaluation of business prospects, management quality and many other parameters. Obviously, these stocks are a tiny subset of the entire market and yet are not a small number. Although we started the Stock Advisor service with 10 stocks three years ago, we have slowly added to the list and currently have 39 stocks on this 'buy' list. All these stocks are continuously revalidated and if we find anything that is not worthy of investment, then they are removed from the list.
This is the base list. Then we have our 'Best Buys Now', which was added a few months back.
Best Buys Now
These are a part of the main list. The main reason why we created this was that 35-40 stocks are generally too many to cope with for most investors, especially new members. This list does not mean that the remaining stocks in our list have been 'de-recommended' in any way. Over a period of time, they're just as desirable investments as the 'Best Buys'. However, they narrow down the focus to just 12 stocks at a time, making it easy to build a portfolio.
Best Buys are meant to exploit the fact that the markets work on both ends of the spectrum. At times, a sound business may be beaten down on account of temporary reasons, which makes valuations attractive. Generally speaking, if your investible surplus is not large enough to do justice to the entire list, then you could focus just on the Best Buys.
Sometimes we issue a recommendation of a stock that is already on our recommended list. This sounds like a strange thing to do but it serves a very useful purpose for our members.
A re-recommendation essentially means that we are re-emphasising that a stock is worth investing in because there is now a significant upgrading of the original logic that made us recommend it. Something more has happened that has made it even more attractive, even more worthy of investing in.
We are all aware that the desirability of a stock is a combination of two factors. One of these is the innate quality of the stock and the other is the proposition that it offers at its current price. We could re-recommend a stock when either of these (or more likely, both) becomes even more attractive than it was when we originally recommended it.
What you should do
So, when you become a member of Value Research Stock Advisor, you will find these subsets of the main list being extremely useful in finetuning your investment strategy. If you are a beginner and/or have limited funds, stay focused on the Best Buys Now list and keep building up your holdings continuously.
When we re-recommend a stock, we are clearly signalling that it is yet more attractive. If you have, for any reason, stopped investing in it, correct that mistake now. Start investing in it. If you were still investing in it, then by all means, increase your outlay on it. Re-recommendation means that it's exceptionally attractive and it would serve you well to invest more vigorously in it. Neither Best Buys nor re-recommendation is a de-emphasis on the full list. However, they definitely help you in fine-tuning things, so go ahead and do that.
Does all this whet your appetite for equity investing the way it should? I certainly hope so. Head straight for www.valueresearchstocks.com and start your membership right now.
Value Research Stock Advisor a premium service where you get promising stocks along with their full analyses. We also actively track the underlying companies for you and keep you posted on the major developments in them, including when to sell a stock. Additionally, members get exclusive access to a range of tools and data which they can use to study any other stock.
To view our complete list of recommendations including all three subsets of stocks described above, subscribe to the service here.