Stocks

Stocks for the Long RunThis is a list of stocks that Fundamental Trends subscribers generally hold for extended periods. On rare occasion we might trade short-term on news or large price swings, however, we are generally on a 3 to 5 year time horizon. People who are looking to trade frequently are genearlly making a mistake. Not only are trying to trade against super computers, hedge funds and investment bankers, they are destined to miss the biggest moves by being "out" when something happens and they wake up to see the news and stock price move too late.

Our core criteria for buying any stock is that we believe it can double in price within five years as a worst case scenario. We believe in building in a "margin of safety" on each purchase.

Most stocks will be released to the public once we are done accumulating a position, generally four to twelve months after initial purchases are made. Often we will use selling cash-secured puts to build a position. Those trades are noted in the Options section. 

Many people will build a 20-30 stock portfolio over a few years and then slowly replace expensive stocks with cheaper stocks. It is a process designed for the patient, thoughtful, forward looking and emotionally controlled. Asset allocation is a seperate issue. Some subscribers buy nothing but stocks, but most blend with an ETF allocation. I recommend blending an ETF portfolio with a stock portfolio. Read the guide you get when you subscribe to learn how to build an asset allocation that is right for you.

Your strongest edge as an investor is the ability to evaluate a company and let the calendar work for you. Not only can you beat the market that way, but you can do other things with your time.

Summary

Look at the big secular trends and embrace them - the future is coming fast.

Old economy, high capital, no moat is a catastrophe waiting to happen - sell your grandpa's stocks.

Find high ceiling stocks within strong secular sectors, build a position, be patient.

I get a l common question from new members to my investment letters: what should I do right now to get started? So, here's some answers:

Summary

These are stocks I own or am looking to own soon.

Price matters, quality matters more.

Sometimes I speculate, but not often, there has to be a massive upside to do that.

Many of these companies can be used in conjunction with an option strategy, so see the monthly options page in the Tools tab.

All you need for a lifetime of successful investing is a few big winners, and the pluses from those will overwhelm the minuses from the stocks that don’t work out. --- Peter Lynch

In real estate it is "location, location, location." In stocks it's quality, quality, quality. The problem is that in the stock market, basically everybody knows who the quality stocks are. There are certain companies that only go on sale once or twice a decade, usually during correlated market corrections when "everything" falls in price.

It's late and I don't feel like reading or writing anymore, but, this is pretty big news for Kinder Morgan (KMI). 

Canada Is Likely to Buy Full Trans Mountain Pipeline Project

In real estate it is "location, location, location." In stocks it's quality, quality, quality. The problem is that in the stock market, basically everybody knows who the quality stocks are. There are certain companies that only go on sale once or twice a decade, usually during correlated market corrections when "everything" falls in price.

T2 is seeking to fill an unmet need for Sepsis testing. Sepsis has been dramatically on the rise the past two decades killing many.

The company has a date with the FDA closing in for its T2 Bacteria panel. If approved, the company would take a lead in the testing for Sepsis.

I have not had the time to do a deep dive recently, but the story remains the same. If the T2 Bacteria panel gets FDA approval, it's already in use in Europe, it will be a sizable improvement over existing blood based tests for Sepsis which can take 2-3 days to render a diagnosis vs the 6-8 hours for T2. 

Why is that time delay so significant? Because by the 3rd day Sepsis often kills you.

I have a very small position in the stock. With the drop today, I am considering taking a call position on speculation they get FDA approval.