In Brief

This is a mixed-criteria GARP screen inspired by the enjoyable best-seller by Robbie Burns, "The Naked Trader: How Anyone Can Make Money Trading Shares". His approach combines a focus on fundamentals:

"My investment strategy has always been quite simple: find excellent companies and hold them until the value comes out".

While he does appear to use a fair amount of technical analysis in order to time the entry, he appears sceptical about pure TA:

"I strongly believe charts are very important to look at.. but I also believe it’s simply crazy to buy and sell shares on the basis of looking at a chart and nothing else at all".

 In the book, Robbie seems to ally himself most closely to the investor type that he calls the Medium Term Trader, i.e. an investor that buys and holds shares for:

"anything between 3 months and 2 years, does some careful research, sticks to stop losses, takes profits when it’s sensible to do so... & prefers smaller companies (with growth prospects) to FTSE 100 ones".

Background 

Robbie Burns is a journalist and writer. Formerly working with BSkyB, ITV, Channel 4, he left full-time work in 2001 to trade and run his own businesses. While at BSkyB, Robbie broadcast a diary of his share trades which became his website, www.nakedtrader.co.uk. He published the first edition of the Naked Trader in 2005, following up with the third edition in September 2011. As Alistair Blair of the Investors Chronicle notes, "The Naked Trader by Robbie Burns sounds awfully like one of those 'How anyone can make money trading shares' books that wouldn't get a mention in this column. It really does say exactly that on the cover. But hey - to ignore the fact that this promise sells books would be very naive. It's what's inside that counts".

The book does cover a lot of very useful material, including an excellent chapter discussing the top 20 mistakes that investors make, backed with real-life examples (these range from not using stop losses, to buying lots of penny shares and/or tipped shares). He also lists in the book 20 "proven" investing  techniques which range from fairly trivial examples like "Find something cheap", to the more interesting ideas such as buying shares that have recently done a share split (he gives the example of Greggs for this) or which are moving from AIM to Main Market ("whenever you see an announcement…

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