What is a Quality Stock Investment Strategy?
Quality Investing is a stock investment strategy based on identifying stocks with above-average quality characteristics. Quality investors tend to invest only in those High Quality equities that are also attractively priced.
Benjamin Graham in the 1930s classified stocks as either Quality or Low Quality. He also observed that the greatest losses resulted from buying Low Quality at a price that seems fair not from buying Quality at an exorbitant high price.
The BCG matrix of 1970 uses two specific dimensions of life cycle and the experience curve concept, the matrix allocates a company’s products and the company into either Quality classes (Cash Cows and Stars) or Non-Quality classes (Question Marks and Dogs).
Quality Investing became very popular after the burst of the stock market bubble in 2001.
How to identifying Quality Stocks
Systematic Quality investors identify Quality stocks using five categories:
- Price potential
- Business model
- Market environment
- Management
6. What is the Stock Investment Strategy -Scalping?
Scalping is very short-term trading in which the investor seeks to profit from quick moves in stock prices in a very short period of time, which can be seconds or minutes. Most of these moves occur in the morning hours and before closing. A scalper sits at the computer the whole trading day. 9:30AM (EST) to 4:00 PM (EST).
