All summers are welcome as we move away from the equator. 2008 must be especially welcome for stock investors. Autumn 2007 had not even started when the sub-prime chill first set in. The investing winter of 2007/2008 has been severe and desolate. Nevertheless, even the Fed has stopped slashing interest rates. We have a once-in-four-years chance until November to make would-be representatives serve us for a change.
The party comes at a cost. Candidates will say things the stock markets want to hear. What if they do not deliver? Populism and sound business management are no bedfellows. Busloads of stocks will jostle for our portfolios during the coming months of economic resurgence. It is make-or-break time for veterans and a rare opportunity for newcomers as well. How can we pick stocks that will continue to rise after the January 2009 inauguration?
Here is a stethoscope of questions you can use to find top stocks right away:
1. How does the Gross Margin compare with the industry average?
2. Has the Gross Margin grown at least as fast as market share during the past?
3. What is the proportion of operating costs and interest to the Gross Margin?
4. Are there new products and services with high value additions around the corner?
5. Does the company operate at multiple price-points?