St Louis Money Spinners
Investment Club
Investing Guidelines
Goals
Learing the art of investing
Having fun
Creating wealth
Not a “get rich quick” scheme
Responsibility
Understand and be committed to SLIC investment philosophy.
Commit to active participation in the club.
Contribution of time and talent
Serve on operational committees as necessary
Participate in the research and investment activities
Participate in educational activities
Attend meetings
Contribute your monthly investment and yearly administrative fees on time.
Understand that all contributions are RISK capital
Abide by the Partnership Agreement and By-Laws.
Philosophy of the club
Believe in Diversification
Doing Homework
Reinvestment of earnings, dividends
and capital gains
Growth Stocks
Criteria for Buying Stocks
3-Yr. Sales Growth (%) > 20
3-Yr. Earnings Growth (%) > 20
Proj. Long-Term EPS Growth (%) > 15
Price Chg. - 52 Wks. (%) Range_Per from 50.0 to
100.0 for Industry
Avg. Surprise, Last 4 Qtrs (%) > 0
1-Yr. Sales Growth (%) > 3-Yr. Sales Growth (%)
Avg. Daily Trading Volume > 200000
Average Analyst Rating <= 2
Price Chg. – YTD (%) > 0
Criteria for Selling Stocks
Although no single factor will determine a
criteria for selling a stock but the following
criteria would be considered
Adverse change in management
Declining profit margin
Deteriorating financial condition
Competition affecting profits
Dependence on a single product
To balance the portfolio or to purchase a better stock
Stock price drops 10%
Diversification Philosophy
In order to lower the risk of portfolio, club
will maintain diversity by Industry and
company size
No stock should account for more than
20% of the total value of the portfolio
No sector should account for more than
20% of the total value of the portfolio
Scaling In
We do not enter into a position all at once
in a single buy
We scale in by buying 50% of the proposed
value to be spent on an equity first
Should the stock decline by more than 5%
then we buy the remainder of the position
Scaling Out
We do not leave a position all at once
in a single sell if we met our profit
criteria.
We scale out by selling 50% of the
equity should the profit exceed 20%.
Remaining position of the same stock
is sold if it decline by more than 15%.
Stocks in our criteria
Stock Ticker
Company Name
RIG
Transocean Inc.
NE
Rating
Sector
Curr. Price
S&P Ranking
2
Basic Materials
100.06
Buy
Noble Corp.
1.6
Basic Materials
97.27
Strong Buy
SII
Smith International Inc.
1.9
Basic Materials
56.91
Hold
CAM
Cameron International Corp.
1.5
Basic Materials
76.5
Hold
CELG
Celgene Corp.
1.7
Healthcare
59.46
Buy
HOLX
Hologic Inc.
1.6
Healthcare
51.82
Strong Buy
RS
Reliance Steel & Aluminum Co.
1.6
Industrial Goods
GME
GameStop Corp. Cl A
1.6
LTM
Life Time Fitness Inc.
LKQX
50.2
Hold
Services
39.55
Hold
1.5
Services
52.75
NR
LKQ CORP
1.4
Services
28.76
NR
ZUMZ
ZUMIEZ INC
1.6
Services
36.48
NR
RIMM
RESEARCH IN MOTION LTD
1.8
Technology
218.5
Hold
CTSH
Cognizant Technology Solutions Corp.
1.6
Technology
82.85
Buy
APH
Amphenol Inc.
1.7
Technology
34.81
Buy
VSEA
Varian Semiconductor Equipment Associates Inc
2
Technology
48.4
Hold
CTV
Commscope Inc.
1.3
Technology
53.23
NR
DIOD
DIODES INC
1
Technology
27.83
NR
Stock Analyst
LKQX & RS – Ganesh
NE – Rajesh
HOLX – Elango
CTSH - Raj
Buy Decisions
CTSH
NE
HOLX
LKQX
*Subjective to through analysis