Evening everyone -
Wow what a day for the Markets - UK100 doing particularly well and the US - up at least 3%.
I am new to this and wanted to know from the experts the difference between GVM & GVGM.
I have read the text and still rather puzzled.
Also when choosing stocks - what is the best stock ranks list to look at?
I would appreciate a response.
thank you
Perhaps you meant QVM and QVGM ? If so the difference is clearly G, or the addition of the Growth Rank.
Hi Mohammed,
In my own opinion, there is no single best Stock Rank list. They all have their benefits, and I guess many people have their personal favorites depending upon their investment style.
The overall Stock rank gives the best combination of factors (Quality Value and Momentum) but this is still, of course, no guarantee of market performance in any single stock.
Also the risk rating is an important element to consider.
Best to consider your own preferred investment style and risk tolerance, then use the stock ranks to aid your own stock selection.
Happy investing and good luck.
QVGM is Quality-Value-Growth-Momentum, the different factors which long term empirical research indicates are predictive of stock market performance on average - i.e. they don't tell you anything about the prospects for an individual company. However, if used to construct a portfolio (roughly 15 to 20 companies) they should give above average performance over reasonable periods of time, where the "average" is defined by the relevant index (which could, of course, still be a loss) and an "average period" is as long as the proverbial piece of string (but say 5 years).
As I recall Stocko dropped the Growth factor when they figured out it has no predictive power over an above QVM. So for all practical purposes ignore the Growth factor and just use Q,V and M. Really Stocko ought to eliminate references to the Growth factor as they're confusing.
Just to repeat - because everyone gets this wrong - a high Stockrank for an individual company is no guarantee of outperformance. Factors only work at the portfolio level, not the individual stock level.
And finally, note that the biggest single day rises in the market tend to happen in bear markets - i.e. they're usually a sign of bad things to come.
timarr
