Quick Prequalify

Use the quick prequalify test to identify the obvious misfits. These may be stocks that would be bad news for any investor. Perhaps they’re firms with businesses based more on hype than reality with little or no sales or earnings. Or they could be stocks that simply don’t fit your investing style; e.g., maybe they’re value stocks, and you’re a growth investor.

Use the quick prequalify test to check:

  • Company and industry overview: Find out something about the company’s business and its industry. It may be in a business or market sector that you favor or that you want to avoid. For instance, the home building industry usually prospers when interest rates drop and suffers in a rising interest rate environment. So your take on the ...

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