What is the Money-Maker System?
The Money-Maker System is perfect for the conservative investor. The methodology creates consistent retirement income, requiring that stocks meet a safety standard before qualifying for a portfolio. That is why it is appealing to the “Safety-Minded” investor. The Money-Maker System pairs safe stocks that have a VectorVest a buy rating, with a risk management technique called the “Profit Locker” which further enhances the safety of the system. In order the generate consistent income, the system is highly adaptable to market conditions. To that point, your portfolio of 20 stocks will be highly diversified, consisting of two stocks per industry to ensure that you make the safest stock picks.
How does VectorVest evaluate a stock?
VectorVest evaluates 7600+ stocks daily through Timing, Value, and Safety formulas to determine if a stock is safe to buy. These stocks are then rated on a 0.00 to 2.00 scale. A rating above 1.00 means that the stock is favorable in terms of timing, value, and safety, while a rating below 1.00 means that a stock is unfavorable.
How does VectorVest Generate a Buy Rating?
A stock will receive a Buy Rating when its Timing, Value, and Safety ratings are well above 1.00, demonstrating that the stock is safe to buy at this time.
What makes a stock safe?
There are several conditions used by VectorVest to determine if a stock is safe. Criteria include:
- The size of the company
Large companies are generally safer than smaller companies. This is because its very difficult to forecast the trajectory of the earning of smaller companies. Therefore the VectorVest safety rating on smaller companies is below average.
- Price Behavior
VectorVest measures the volatility of stocks as part of generating its safety rating. This is performed by determining how far the price of a stock has veered from its mean. Historically stocks tend to revert to their mean. When the price of a stock is well below or well above its historical mean, volatility is likely to be too high and therefore considered unsafe.
- Longevity
All factors being equal, it’s better to invest in a company with a long track record than a new company with little to no earnings history. While some new companies offer the most attractive investment opportunities, they also are riskier and can have numerous pitfalls. VectorVest considers a company riskier if it has not been trading for at least 5-years.
- Dividend History
A company does not have to pay a dividend to be considered a safe company. If a company does pay a dividend, its important that they maintain or increase their dividend. A cut in the dividend is a black eye that is a warning sign and questions the safety of investing in the company.
How does VectorVest use a Profit Locker Stop?
A Profit Locker Stop allows you to set a profit target and a maximum loss, ensuring that you lock in profits. The Profit Locker uses a stop price to efficiently manage risk. The stop-price is a trailing stop that moves up and down with price action. You set your profit target and maximum loss and the Profit Locker will automatically adjust. The Profit Locker adjusts to the price action based on the inputs you select. A stock that hits the Profit Locker Stop will be replaced with a stock from the Money Maker strategy if the timing formula indicates that it is safe to buy. If it is not okay to buy, the stock will not be replaced until the timing system says it is. Once the price of a stock moves above the entry price, the Profit Locker will set a stop above the price of the stock, locking in a profit at all costs.
What Kind of Stocks Should You Invest In?
Intelligent investment decisions cannot be made without including an assessment of stock safety. Do not let stock safety be your missing link. By using the Money-Maker system, you can combine the safest stocks with a robust risk management system, allowing you to earn consistent solid income without taking risky bets.
What Tool Gives You this Trading System and More?
VectorVest. Sign up for our 30-day, risk-free trial and get the training and support you are looking for and start making money in the stock market.
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