The New Very Short Lists 2020

Summary

  • Expansion of the VSLs to include tracking.
  • Wider coverage list with “must owns” to get on corrections.
  • Broader research capabilities using TradingView & Stockrover allowed me to sort and monitor better.
  • Will have balance of data entry finished by end of Q1.
  • Still have more stocks to add as research is finished.

I have the “beta” version of the new Very Short Lists with trade tracking up and available now. Click here to see it or go to the Tools tab. 

These new VSLs are expanded as I try to cover a wider range of companies that people might own or might want to own. Here’s the bullet list of what I have done so far and what is coming:

  • I have removed all the companies that no longer meet scrutiny.
  • Made some updates to DJIA list. 
  • Expanded Dividend Growth using 3-year dividend growth rates, sustainable growth rates and shareholder yield. In short, every company is growing and improving their balance sheet in order to support the dividends long-term. Expect several more companies later this quarter.
  • Changed nature of Retiree Low Volatility Dividend a bit to reflect 3-year beta rating under 1. That eliminated most tech stocks, so you will need to go to Dividend Growth for tech. Result was expanded Utilities, Communications & Consumer Staples pick. This list will exhibit less volatility and slightly higher income, but lower growth, so buying at value prices is especially important.
  • Alt Hi Income is a work in progress and will focus on REITs, MLPs, YieldCos, BDCs and whatever else pays dividends above 5% (equiv to long-term treasury historically). If there is a high dividend stock you like and you can support it with a SWOT report & brief investment thesis, send it to me at [email protected] and I will consider it for coverage.  
  • Sustainable Growth has been updated, but there is more to come as I continue to do the research on about a dozen stocks.
  • Added “Spec” tab for those who want to swing trade certain volatile stocks or speculate on turnarounds. A few more to come there as well. 
  • International added a couple companies, several more to come. 
  • Need to incorporate Ted’s and Dave’s picks yet. 
  • I will be adding a “Top 20” tab that highlights what I feel are the best stocks to own long-term.
  • The tracking pages are blank, I’m going to try to get my kid to populate it, otherwise I will. Will add picks back to start of 2019 and all new picks based on published trade alerts. This will make it easier to track buys and sells. 

Research Process 

I spend a lot of time since September reading, taking notes and charting. 

I used StockRover extensively to do deep screening and data sorting. The screening functions were nothing short of amazing once I figured out how to use them. They have several dozen preset screens and the ability to add customized criteria. If you are looking for a cheap way to really dig into the numbers and screen for new ideas, I recommend StockRover, it’s replaced Zacks and a few other services for me. 

I also have been using TradingView extensively now. Again, there was a learning curve. If you are looking to learn technical trading, I think they have passed StockCharts and I have downgraded my membership to YCharts as a result of the extra tools and lower cost at TradingView. 

If you are a member of R.A.R.E. and plan to join us swing trading in a couple weeks when I get back from vacation, you should have TradingView.

Biggest Take Away From Research

Ultimately, research takes time. I warn you against the guys firing out 7 or 8 “research” pieces per week. There is NO WAY they are doing good research. I might do that many for a little while to catch up, but it is unsustainable beyond “Quick Thoughts” and updated charting. 

I also caution you against all the permabulls out there. Especially those hocking dividend stocks or REITs. I’m telling you, there are going to be a lot of hurt people in the next correction who have been paying growth prices chasing yield. 

It is clear to me after studying chart after chart and data set after data set that the stock market is desperately overvalued. We are on thin ice and the ONLY thing keeping markets up is the Fed pumping money into the banking system again – stealth QE via the repo market. 

Take very special notice how much difference there is between the Bottom Fishing prices and current prices of most stocks of the good companies. Imagine what it is for the bad and mediocre companies. The last time we got near and around the Bottom Fishing prices – which were spot on in many cases, i.e. Tesla, Google, Amazon, etc… – was several days around Christmas 2018 (that’s how fast it was). 

When this market turns down, and it will someday soon, it is going to be at least as bad as Q4 2018 and possibly much worse. If we enter a period where no fiscal policy can get done just as the monetary tools lose effectiveness, like they did in Japan and Europe, the S&P 500 can drop 40% quickly. I think that’s a very probable scenario. At best, I believe we see a 20% correction this year. At worst, a 60% downturn.

When that next correction happens, the VSLs should make for a very good shopping list. Think about what you want to own in the early to middle 2020s over the next several months.

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

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