Question 1

What is the average holding period?

Accepted Answer

What is the average holding period?

| The average holding period is around 2.2 years

The minimum time period a stock can be held is 1 month. The maximum time period a stock can be held is 4 years. (Although it is rare for a stock to be held this long it does happen.)

Our approach is well described by Benjamin Graham in this quote:

The disciplined, rational investor neither follows popular choice nor plays market swings; rather he searches for stocks selling a price below their intrinsic value and waits for the market to recognize and correct its errors. It invariably does and share price climbs. When the price has risen to the actual value of the company, it is time to take profits, which then are reinvested in a new undervalued security. - Benjamin Graham

This approach has both proven very safe and provided high annual returns, but it does require some patience. Sometimes the patience needed may appear quite considerable. But most of the stock picks in our experience have not taken that long to show unrealized profits, (even if we might not sell them right away).

Question 2

Which brokers support Formula Stocks?

Accepted Answer

What brokers support Formula Stocks?

| Any broker that supports the exchanges: NYSE, NASDAQ & TSX will work with Formula Stocks Formula Stocks will work with most brokers around the world.

If you don't have a broker yet, or your current broker does not support the above exchanges, you will need to find a good stock brokerage firm to be able to invest in all of the companies that Formula Stocks invests in.

||| If your broker supports NYSE & NASDAQ or a subset of these. You can still use Formula Stocks as an analytical & evaluation tool, but there will be some trades that you will not be able to follow.

To find a broker with support for these exchanges, Google is your friend!. There are many hundreds of stock brokerage firms around the world, and many of them only operate in specific countries.

To get you started here is a short and incomplete list of brokers in no particular order some of our subscribers use to invest with Formula Stocks.

International:

Interactive Brokers (This is the broker we personally use)

USA only:

Europe only

Degiro
eToro
Saxo bank
Nordnet (only Scandinavia)

Asia only

If you know a good stock broker that's missing from the list, pl

Question 3

Getting Started with Formula Stocks

Accepted Answer

Getting Started with Formula Stocks

There are 3 primary way to use Formula Stocks

You can mirror the model portfolio. (as described below)
You can buy single stock suggestions when available (click here to go to Suggestions)
You can use the AI Score to aid you in portfolio selection (Click here to go to AI Reports)

An easy way to use Formula Stocks is by mirroring our model portfolio by following the monthly trades.

To do this you will need a stock brokerage account which allows you to buy and sell stocks on North Americas most popular exchanges: NYSE, NASDAQ & TSX.

|| If you don't have a brokerage account yet, or your brokerage account doesn't have support for these exchanges. Click here to see what brokers support Formula Stocks?

Once you have a brokerage account, there's only 2 steps to use Formula Stocks.

Mirror the portfolio
Follow the monthly trades

||| Please note: Your capital is at risk when investing in stocks. Make sure you have the requisite knowledge on investing in stocks before you continue.

The portfolio

On the portfolio page you'll see a list of stocks like this:

These are all the stocks that is currently being held in the Formula Stocks portfolio

Question 4

How to use AI Reports

Accepted Answer

How to use AI Reports

The AI score constitutes a revolutionary easy way to pick stocks. Usually, stock analysis is a cumbersome process. You could spend days analyzing a business in detail. Even then it is highly uncertain that one would happen to focus on the right combination of parameters without many years of experience.

Enter the world of Artificial Intelligence. We have developed an AI which can analyze a business from a fundamental standpoint and provide a real edge. This is the same basic form of business analysis you would expect from Warren Buffett or a Certified Financial Analyst. Having analyzed the business, the investment proposition is analyzed from a purely mathematical standpoint. Then the technical situation is taken into consideration. And also statistical merits are analyzed. All in all more than 400 data points contributes to an Artificial Intelligence-based evaluation of the merits of any investment.

same basic form of business analysis you would expect from Warren Buffett or a Certified Financial Analyst. This process is carried out by a supercomputer. It manages to perform a large number of analyses in mere hours, where over a hundred human analysts would take weeks to approximate a similar result.

We refer to the output of this process as the AI score. It presents an effective and simple-to-use shortcut to better decision making. The AI score is basically a single number. Each stock has an AI score, a number which embodies most of the relevant

Question 5

Does Formula Stocks use options trading?

Accepted Answer

Does Formula Stocks use options trading?

| No, does not use options trading, only buying and selling of stocks.

While our high win ratios at first this might seem like a great opportunity to utilize call options the holding period could make this trading strategy very unattractive.

Formula Stocks is a longterm investment strategy with an average holding period of 2.2 years (max 4 years). This would mean to still achieve our high win ratio you would have to purchase options very far in the future (which comes at a high premium).

Afterwards many options will slowly lose value over time if the upwards volatility stays low often resulting in losses even if the stock slowly increases in value.

We recommend simply following the model portfolio by buying, holding and selling shares.

Question 6

Why is there no AI Report for X company?

Accepted Answer

Why is there no AI Report for X company?

It requires a lot of high quality & reliable data to generate our AI reports. Because of this, it is not easy, simple or even possible to include all stocks in the world.

Our AI Reports are limited to stocks traded on the following 3 exchanges:

NYSE
NASDAQ
TSX

To make an accurate evaluation of a company, our AI reports also require at least 7 years of data while the company has been traded on one of the above exchanges.

Lastly our system only analyzes stocks with a minimum market cap. This helps Formula Stocks to avoid liquidity issues as it takes a lot less to move the stock price of a smaller company.

| If the company you are looking for doesn't have an AI Report, it is probably because we don't have enough data to accurately evaluate it or it's too small / new to be considered.

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