My Fundamental Process: Part Three

The final step in my fundamental process is to take into consideration my macro outlook. For instance, if I think the economy will get worse I am less likely to buy shares in companies whose cash flow will suffer in a weaker economic environment, unless I believe its already priced in.

Once I finally emerge with a buy candidate using fundamentals I might use my (non fundamental) indicators to decide on the timing of a purchase or if I should hedge the position with a short on the S&P 500 or another index.

2 comments:

Anonymous said...

So what stocks fit this criteria?

Tsachy Mishal said...

The last stock I bought was Medtronic. It has run nearly 10% since I bought it but its still priced well. If the stock corrects its probably still ok to buy.