Monday, February 16, 2015

My Watchlist, Step 1b



A week ago I mentioned that I am going to reboot my investment process. I found it messy and haphazard.

I already took some time to go through a rudimentary screen. I'm surprised I wasn't that lazy and managed to do that quite quick.

Today, I combined the results of those 4 lists together to get one exhaustive list of the companies that apparently meet my criteria of:

  • Dividend Yield is positive
  • Net Profit Margin is positive
  • Debt/Equity Ratio is under 200%

  • I have decided to make it a public file, so it you want to take a look, you can download it here.

    From the SGX universe of 775 stocks, I have managed to chop off a lot of companies so that my current list has 429 stocks. This is about 55% of the total number of stocks listed on the SGX.

    Moving forward, the next step in my process will be to look at the stocks and see if they can be trimmed without looking at their financials. Unfortunately, since my SGX portfolio is a portfolio in SGD, I will also be cutting off any stocks listed in other currencies. I think the biggest culling will come from companies that seem to be in a sunset industry or with a seemingly bad business model. Hopefully I will be able to quickly cut 5-10% off from the watchlist with these additional parameters. I am aiming for the list to be under 400 stocks by the end of the next step.

    I have to stress that this watchlist should not mean much to anyone right now. If you buy any stocks here, there absolutely no guarantee that you will do better than if the stocks are not on this list.

    However, I would be pretty confident to say that the stocks on my list would perform better than the stocks not on the list. Equal weight my 55% in a portfolio and run it against the other 45% equal weighted as well. I would definitely wager that my portfolio would outperform.

    4 comments:

    1. Hi GMGH

      Will you be doing a further filter into the screen of stocks you have done?

      That's still a huge lists out there to absorb.

      ReplyDelete
      Replies
      1. Hey B,

        Hehe, of course! 429 is still way too much, not manageable in my opinion. After I do some quick chopping to get under 400, I'll start digging into the business fundamentals.

        There's still a ton to go through, but I think I'll try to work my way through the list alphabetically. Or maybe by industry? I suppose it would be more useful and meaningful to compare fundamentals of companies to those within the same industry. Hmmm, I think that sounds like a good plan actually!

        Delete
    2. Just a tip, use Google Spreadsheets instead of XLS, it's easier for mobile users to read :)

      ReplyDelete
      Replies
      1. Thanks for the tip, will try to keep that in mind the next time!

        Delete

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