Investing Principles and Methods Series (IPMS)

Earlier on I posted four critical areas I would look at in evaluating public companies for my own investment.  I’ve since revised from:

1)     Ethical Issues
2)     Owner’s Reward
3)     Debt Management
4)     Value Investment

The new version will only include the followings:

1)     Return on Equity
2)     Intrinsic Value
3)     Relative to Market
4)     Ethical Issues

I have chosen to stay with the pass or fail grading system.  Again, the final assessment of a ‘pass’ grade will only be rewarded to companies which passes all four key areas under scrutiny.

My previous goal was to present at least one company analysis per week.  However, I found this to be difficult in light of my schedule; no more goals – just going to wing it when possible.

Howard

Copyright © 2010 by Farting Camel

Investing Principles and Methods Series (IPMS)

This is perhaps the biggest part and the most important element in this series – the outline or format which will keep me in line as I present my work to you in a more practical aspect of stocks investment.

I have thought about this process more than you care to know.  This represents the administrative part of the series in which I’m laying out the rules.

I have isolated the list of important requirements that will let me evaluate and determine the merits of US public companies for my investment purposes.  I have decided on a new grading method isolating key areas in the target company that allows me to quickly determine an investment merit from a glance.

The four key areas in determining an investment merit in stocks are:

1)     Ethical Issues
2)     Owner’s Reward
3)     Debt Management
4)     Value Investment

My analysis will follow an overall pass or fail grading system.  The final assessment of a ‘pass’ grade will only be rewarded to companies which pass all five key areas under scrutiny.  A company not meeting these stringent criteria will fail the grading process.

What does a pass or fail grade mean to me?  This list of companies with a pass grade will be shortlisted for investment consideration, and may ultimately be placed in my investment portfolio.

I will track and present the investment results for you to view at your convenience under the sub-category ‘Portfolio’ within the main ‘Stocks’ page.  The goal is to present at least one company per week.

Howard

Copyright © 2009 by Farting Camel