The easy route to a winning stock portfolio

It's now been six years since we launched Value Research Stock Advisor. Ever since, this has been the most frequent question I've been asked, "What kind of stocks do you recommend?"

My answer to that question has always been that we recommend stocks that will make money for you. To some people, this sounds like a non-answer, as if I'm avoiding the question, but it's not. I mean, I am avoiding saying the kind of things that some investors expect, but I'm doing so with careful thought. Investors expect to hear well-worn terms like dividend stocks, value stocks, growth stocks, large/mid-small or contrarian stocks or some such common way of classifying stocks. They await an answer that is filled with such jargon.

If you are reading our magazine 'Wealth Insight', you might be reading and watching other media about stock investing and constantly coming across these terms. They are fully justified in expecting such answers because that's how things have always been done in the business of stock recommendations.

Plenty of stock advisories have different services for mid-caps or value stocks or whatever. Like any other business where specialist professionals guide the casual customer, there is an upside to creating complexity and many different products. We don't believe in that. That's something that has been a guiding principle of Value Research over the long (almost three-decade) period that we have been guiding investors.

Let's see what Value Research Stock Advisor does, why it's different and why it makes sense for you.

Our job, not yours
In Value Research Stock Advisor, there is only one stream of recommendations - a list of stocks you should buy. Does that mean we don't look at factors like dividends, the value equation, or capitalisation? Far from it. These factors are central to our evaluation of stocks. However, looking at them is our job, not yours. We have a great liking for companies that have good dividend yield, are available at a reasonable value, and we fully believe that a good portfolio should have a balance of large, mid and small-caps. However, these are just some factors that go into stock selection. They have to be weighed with each other and against each other to decide whether a stock is worthy of investing. If we have a list dedicated to a certain class of stocks, that cannot be done.

So, does that mean that our stock recommendations are an undifferentiated pile? Far from it. As our members know, we, too, have differentiated categories of stocks. The distinguishing factors are that, one, they are parts of the same service; two, they can overlap; and three, they fit the way investors should invest. Puzzled? Let me explain.

Best Weather Now
We mark some of our recommended stocks as 'All Weather' and some as 'Best Buy Now'. Notably, these are not categories but more like the hashtags you see on social media. That's an idea. Uniquely, we have some recommended stocks which are neither and some which are both! They are ALL recommended for investing, even the ones which are neither. Let's look at the 'Best Buys' created a couple of years after the service's launch.

A problem of plenty
Why did we do this? Because it served a genuine investor's need. To begin with, Best Buys served a problem of plenty that our new members faced. We have 51 recommended stocks currently. You can become a member and buy all 51 on day one, but starting in bulk is not a great idea. We started with 10 stocks when we launched this service in November 2017. As the months and years went by, we added a lot of stocks and removed some and now have 51. In April 2020, we created a 'Best Buys Now' list. This is not added to the recommendations but is a selected subset. The basic idea is that if stocks in the main list are too much for you to invest in, then at this point in time, you can concentrate on building positions in the 'Best Buys'. Best Buys reflects a problem of plenty which some of our members cannot cope with. It does NOT reflect any issue in those stocks that are not in Best Buy.

So, does that mean that seasoned investors should ignore Best Buys Now? Not at all. Best Buys is not just for beginners. There's nothing magical about it that is more useful for beginners. It is exactly what the name implies. What are best buys now for beginners are best buys now for everyone. Essentially, that is all you need to know to use our Best Buy list to finetune your equity investing. 'Now' is an important word in the name of this feature. For example, at times, a sound business may be beaten down for temporary reasons, which makes valuations attractive. Best Buys is designed to exploit this and other sharp, focused opportunities that may present themselves at a time.

Most importantly, it is not a type of stock like the conventional categories that people think of. Our idea is how stock recommendations should be classified in investors' interest. An old saying goes, "The best time to plant a tree was ten years ago. The second best time is today." Some people might interpret this as meaning that you can plant a tree at any time, and it doesn't make a difference. Today, tomorrow or 10 years later, no matter when you quote this saying, it will always be today. But that's not what it means.

A lot else
Let's take a look at what you will get with Value Research Stock Advisor:

• Access to all our stock picks
• Best Buy stocks selected from our recommendations. Use this set to start building your portfolio right away!
• The complete investment thesis for all recommended stocks so that you understand why you are investing
• New recommendations as soon as they are released
• Continuous updates and analysis on all recommended stocks straight from our dedicated analyst team
• Tools and data to research and analyse any other stock

To start right away, head over to Value Research Stock Advisor, read the details and become a member.