Sunday, May 25, 2008

RiskGrade Review Update

I run my US stock and ETF screens every weekend and record the stocks and ETF's that pass as well as the RiskGrades.  It is much too early to make strong conclusions but thus far it appears that the best stocks are those having a Riskgrade between 250 and 400 and the best ETF's are those having a RiskGrade between 125 and 175.  At first I didn't recognize the importance of requiring stocks and ETF's to have a minimum RiskGrade but in hindsight it makes sense.  Why buy an ultra-safe stock or ETF (i.e. an investment with a very low RiskGrade)?

My observations are based on buying and holding the stocks and ETF's for two months.

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